There is only a 3 to 5 percent chance that a family business will survive to its fourth generation. Matt Alderton writes an article sharing four shrewd tips to beat the odds.
The first tip is that the business should change between generations, but keep the same mind and heart about it. The knowledge and type of insight that allows one generation to expand should be handed down and used to plan the next great expansion. The second tip is to “think ‘merit,’ not ‘inherit,’ ” by making family outright earn the right to take over. Selling the company can and should occur if the next generation is not up to the task of running it well. Third then, and a highly cited concern, is to do diligent succession planning. It is a formal discussion that must be agreed upon in writing. The final tip is to divide to conquer, in that different family members may have different strengths. Determine the turf and/or layers of the business where individuals best operate, and let them use their abilities to make the business as strong as possible.
You can read the original article here: http://www.nfib.com/article/4-family-business-survival-tips-64918/