When I was about 4 years old, my father’s company transferred him from Louisiana to Ohio. I don’t remember much about that transition, except that it ultimately didn’t happen. Instead of accepting the job transfer, my parents chose to start a new business.
It was definitely a new beginning, an unanticipated transition full of uncertainty and change. But it was good and right.
My brother and I spent much of the rest of our childhoods in the same house where we had always lived, with one exception: the garage was enclosed and became an office where my parents worked side by side to establish an insurance agency.
We grew up watching our two very differently tempered parents face challenges, solve problems, offer advice, deal with difficult people and eventually enjoy success. Theirs was truly an equal partnership, and each comfortably wore the mantle of leadership.
Today my brother leads the business, combining the best of what he learned from each of them and bringing unique qualities all his own. Working alongside him are his wife and their three sons, one a college graduate who works full-time; the other two, college students who work between classes.
Family businesses comprise somewhere between 80 percent and 90 percent of all North American business enterprises and account for around 60 percent of total US employment. Within the next five years, nearly 40 percent of those businesses in America will hand over the leadership reins to the next generation.
How they plan for and navigate that transition is critical. Only 40 percent of family owned businesses survive to the second generation, and the survival rate decreases significantly with each successive generation. Just 12 percent survive to the third generation, and 3 percent to the fourth. The selection of a new leader is, in fact, the single most important decision in moving a family owned business from one generation to the next.
One of the major reasons family businesses do not survive, experts say, is the lack of timely and careful leadership succession planning. Yet the same people who had the entrepreneurial skills and courage to start a business have what it takes to plan and navigate a smooth leadership transition.
It’s clearly not easy. It takes commitment to what is best; courage to make tough decisions; vision for where the venture is going and where it needs to go and the ability to communicate, motivate and instill confidence, among other things.
Elijah, keenly aware that his time as a prophet was drawing to a close, contextually demonstrated these qualities when he chose Elisha as his successor. Both men modeled a healthy respect and appreciation for each other that demonstrated to others that God was directing the leadership transition.
Wise leaders, whether they are in families, business, church, government or other arenas, know both when to accept the mantle of leadership and when to place it carefully but squarely on the shoulders of someone else.
A carefully planned ending to one era insures a healthy beginning for the next.
Jan Turrentine is managing editor of Acacia Resources.