Episode Transcript
Glenn Harper [: 00:00:00
Hello, everyone. Welcome to another edition of the Empowering Entrepreneurs podcast. I’m Glenn Harper.
Julie Smith [: 00:00:04
Julie Smith.
Glenn Harper [: 00:00:05
What’s going on, Julie?
Julie Smith [: 00:00:05
You know, we got a new setup here and I kind of like it.
Glenn Harper [: 00:00:08
I like it. Chairs are comfy. It’s like a fireside chat.
Julie Smith [: 00:00:11
Yeah, we got coffee still and you still have a microphone, so we should be in good shape.
Glenn Harper [: 00:00:15
Danger, danger. It’s all good. Well, we’ve got a great show for you today. Instead of a guest, we’re going to talk about some topics that we come up with in our day to day life with our clients. And one of those consultants, those things that we come up with is business succession planning and how to not make that a problem with entitlement and, you know, keeping and retaining employees and clients. How does that look?
Julie Smith [: 00:00:39
How come when we practice this, those were my lines and you took them away. Now I gotta think on the spot and pivot. You make this, you make this hard.
Glenn Harper [: 00:00:46
Listen, I’m not here to make your life easier. I’m supposed to challenge you.
Julie Smith [: 00:00:49
So, yeah, so let’s, let’s pretend, you know, I own a business and I have maybe some children or nieces and nephews. And I’m thinking of how do I switch this business and start that transition from me to a family member? What does that look like?Glenn Harper [: 00:01:09
Well, that’s a great question, Julie. I tell you, the hardest thing in this generally is the owner itself. So let’s assume you are the owner. Is. Do you really want to get out?
Julie Smith [: 00:01:22
I think that’s a huge emotional thing that you have to go through. And I think for us, most of the time, people either come when they’re at their. I know I’m supposed to be pretending I’m the owner. So I’m either at my wit’s end and I’m ready to walk away tomorrow, or I’m just starting to think about it because I, maybe I’m getting burnt out, maybe I’m starting down that path. But I feel like for us, we don’t really see people in the middle of that. It’s either here or here. And then we, we have to be able to, to talk through those because you got to be able to get one, you got to rein these people in a little bit. Right.
Julie Smith [: 00:01:57
Because we’re not quite ready. But these people, which you got them down the path to do it correctly. So talk to us about that.Glenn Harper [: 00:02:02
Well, usually it’s some significant event, like a horrible experience with some employees, a horrible experience with a client, and they’re just like, I am done with this bs, I’m so, so out of it. And, and really that is begets the start of the process because you’ve been doing it for 20, 30, 40 years, however long it takes that you’ve been doing it. But it’s, it’s your whole experience at.
Julie Smith [: 00:02:22
Year five, though, let’s be honest.
Glenn Harper [: 00:02:23
It could, but probably doesn’t because you’re still trying to figure things out. But you’re usually the people that are doing this, they have built the machine, it’s effective. But the machine they’ve built is going to be one of two machines. These are the solopreneur, where it’s them that do everything and they’re the brains, the intellectual property behind it all. And they’ve never shared that with their team or whoever is going to take over the company. You know, family members, uncles, aunties and aunts, whatever, brother, sister, it could be anybody. They never shared what that looks like, that burden. So to make that transition is very hard.
Glenn Harper [: 00:02:57
Or they’ve been running a successful business as an, as an open owner, operator and the systems and process and all that thing is operating and then somebody could just plug and play. So on both of those, those are two different conversations, right? Because the first conversation is, well, to get the best success of this, I have to then, meaning if I’m the owner, I have to teach somebody everything I know. And are they willing to take that burden of having to learn it all? Do they want to put in that hard work and carry the burden of knowing it all? That’s a hard question to have or decision to make. Because that person that you’re going identify, that’s going to take over the company, are they willing to do that? Because more likely than not, they’ve probably watched to say me go through the trials and tribulations are like, I don’t want any part of that. That’s just going to be too hard. Where in fact, if I’ve already, we did the hard stuff, somebody could come in and probably be successful at it and it wouldn’t be an entitlement thing would be like, you have to work for it. And we’d happen on the other side, the machine’s already running and everything’s going good and you’re just going to magically plop somebody in there to run it. That might cause some resentment for your employees have been there forever and you’re just showing some Neptune, putting a family member in there that maybe didn’t earn it, but maybe they did earn it.
Glenn Harper [: 00:04:12
So that communication, which I know you’re a big fan of. Right. Of how do you communicate that effectively to the clients and the staff? I think is a good segue to your next question.
Julie Smith [: 00:04:21
I think it’s also a lot of marketing.
Glenn Harper [: 00:04:23
Correct. And again, the. The hard part is you or me as an owner of a company, when we’re willing to walk away, what does that look like? The timetable, the roles? It’s really hard for somebody, an entrepreneur, to. To put that together and identify it. Like, what does that look like? Because when we’re done, that’s been our whole identity for most entrepreneurs their whole life.
Julie Smith [: 00:04:44
Well, I think sometimes, though, it’s that. That a staggered transition, I think, is sometimes where you can see the, you know, where maybe they are transitioning, but they’re going to stay on for two years or whatever the case is. I feel like that succession usually goes a little smoother as long as that person leaving is. Is letting go of the. The reins a little bit.
Glenn Harper [: 00:05:06
Well, there is the question. So as the entrepreneur, as you’re trying to make this decision, it’s so hard to give up that control and hand that off to somebody else where you just know, maybe they’re ready. The person you’re giving to is, or selling to or however that works is ready. Maybe they’re not. But to give it up and then going to sit there and watch them stumble and trip and fall, and all that hard work you did, you’re going to give it to them, it’s really hard to do that, but that’s the only way they’re going to figure it out. But it’s real so hard to do that. So that that mindset of you as an entrepreneur, once you decide that, that you want out, you have a couple of choices. Sell to a third party or sell to somebody internally, whether that’s a family member or somebody in your organization, you kind of got to decide what that looks like.
Glenn Harper [: 00:05:50
Who do you think your hardest thing is, really? You want to help your family out, but at the same time, you want the business to succeed. That’s your baby. Right. And so who’s the best person to take it over? The finish line is the hard decision. So somebody has to step up and figure out, you know, are they ready to take those reins?
Julie Smith [: 00:06:08
What was the second question?
Glenn Harper [: 00:06:10
Second question is, after you get it done, is. Is. Is you as the owner staying on board? If it’s probably a third party, for sure they want to have you around just enough to suck the information out of your brain, all the secrets, then they don’t want you More because they’re going to put their own culture, do their thing. The family member, then you really want to be there to help, because what parent doesn’t want their kids to succeed, right? So you’re going to probably be a little helicopter more than you need to be with your family. And so you have to define those parameters to understand it’s not what you want anymore. It’s the person who’s taking over that family member of what they want. That’s the hardest thing.
Julie Smith [: 00:06:48
I think that’s where we see a lot of the. The butting of heads or, you know, and I think that goes back to being able to let go of the reins enough. And I feel like you’ve got to mentally, emotionally, physically be at the point where you’re going to do that for that to succeed. And I think the succession plan is just as much about the person coming into it as it is about the person stepping away from it. And you both have to be aligned. And that’s a lot of communication, a lot of clarification. A lot of times sitting and talking and having those hard conversations. And I think that’s where things kind of go awry, right?
Glenn Harper [: 00:07:22
We type it on the typewriter and we put it in a manual filing cabinet. New generation doesn’t do it that way. Like, how do you convert one to the other and make that transition happen? So, and again, it’s. It’s just open communication. And you gotta get into a position where we are gonna agree in concept what this looks like. And then we’re gonna tick and tack as we move toward that ultimately ultimate exit. But you have to kind of define what those roles are and what that would look like. Because if you, if you don’t, you’re gonna just be on a whim.
Glenn Harper [: 00:07:50
That’s what I think we should do. This person think what they should do. And now we’re butting heads and that doesn’t solve anything. So we. You really have to play that out. But yeah, it’s hard. We just work with lots of clients where you might have a family member come over and take over and they’re like, well, that person didn’t earn it. But then you have the ones where the family member did earn it.
Glenn Harper [: 00:08:10
They were there as a kid working and they work and they understand the whole organization. And there’s no better supporter in that organization of all the team than that particular person, the child or something that is earned its way to the top. That’s the best kind of smooth transition. Just dropping somebody and that’s really, really hard. So I hope that will help everybody as they navigate their succession planning and not have to feel like, remember, at the end of the day, you still want to have Christmas dinner with your kids and your family members. You don’t want to make the business be the breaking point of that. And so whatever that takes.
Julie Smith [: 00:08:44
And we will attach the episode where we did those 18 summers with the person who had all the experience in doing that, too. We’ll tag that to this episode in case you want to listen to someone else’s perspective.
Glenn Harper [: 00:08:56
There we go. Hope that was most helpful for all of you. Another edition of the Empowerment Entrepreneurs Podcast. I’m Glenn Harper.
Julie Smith [: 00:09:02
Julie Smith.
