Many business leaders—especially those in small and medium-sized enterprises—are reluctant to address the issue of their own succession. Typically, it is the uncertainties surrounding their personal future, the fear of the unknown handover process, and a reluctance to relinquish control that seem insurmountable. In practice, it has been shown time and again that one key factor helps to master this challenging task: long-term planning of the “business handover” project. However, it is a fallacy to believe that this process ends with the signing of the purchase agreement and the successful completion of the transaction. Whether the handover is ultimately successful depends crucially on the practical transfer of the business to the successor.
As an experienced executive, our client took over the reins of a family-run heating and plumbing company a few weeks ago. After several decades of leading the company, the time had come for the seller to hand over the keys. For him, one goal was paramount: the successful continuation and development of the company. An internal succession was not possible. After the initial discussions, it was clear to him that he had found the right partner for the acquisition in this prospective buyer. Looking back, both agree: “Thanks in no small part to the experience of our consultants, we realized very early on that there are several key points both sides need to consider from the outset to successfully reach our goal: viewing change as an opportunity, clearly defining roles throughout the process, and gaining and securing the trust of all parties involved at an early stage.”
Viewing Change as an Opportunity
Business succession is a very intense and lengthy process for everyone involved. Having the right mindset from the outset is a key source of strength here. It is crucial to view change not as a threat, but as an opportunity—and to seize it. For the entrepreneur, this opens the door to a new phase of life with fresh perspectives—for long-neglected or new hobbies and interests, for the family, and for the entire social circle. As the business is handed over to new leadership, it gains new momentum and the potential for change on the path to continued success and growth. For the external successor, the new role is both an opportunity and a challenge: “The feeling of taking on responsibility for a valuable legacy and successfully carrying it forward fills me with both immense respect and energy.”
Defining Roles and Responsibilities
Arguably the greatest challenge in the succession process is transferring active management of the company to new hands. For employees, customers, and suppliers, there has often been only one central point of contact for decades: the business owner. This makes it all the more important for the successor’s success—and thus also for the future of the business—to grant them the freedom to make their own decisions and take their own actions.
At the same time, the seller’s transition into an advisory and supportive role is essential to avoid jeopardizing the existing trust with all stakeholders. If the successor’s role and the associated responsibilities are not clearly distinguished from the transferor’s new roles and responsibilities—or if the parties involved simply have differing understandings of their respective roles and responsibilities—this will lead to conflicts. The involvement of external consultants is necessary here to tackle this redistribution of responsibilities in a timely and structured manner. As the new company leader reports: “In the first few weeks, our consultants encouraged us to hold regular meetings and coordinate tasks, and they supported us throughout this process. For example, we agreed in a timely manner on who would handle the daily briefing of the service teams and the monthly supervision of the foremen, who would be responsible for responding to inquiries from the tax advisor, and who would ultimately handle association work—always with the common goal in mind: to make the transition in company leadership as smooth and successful as possible.”
Building Trust
An important goal during the handover of the company is to “get everyone on board.” Targeted communication—in terms of content, style, and timing—has proven to be a key building block for trust. In the case mentioned, for example, the successor was formally introduced shortly after the transaction was completed during a staff meeting. This allowed employees to gain a direct, personal impression of the new company leader. This was followed by separate meetings with the management team. Communication with customers and suppliers—which is also critical to success—took place gradually through personal meetings initiated by the former owner. The seller proudly sums it up, and rightly so: “For the successor, support from the outgoing entrepreneur is indispensable in this part of the process. Only if the outgoing entrepreneur succeeds in credibly conveying his confidence in the successor to the outside world will the trust and confidence of all parties involved be strengthened.”
