No two transition plans are the same – that is obvious to anyone who has done some reading on the subject or has partially or completely navigated through the process. However, there are commonalities found among lots of families and farms that manage through this important stage of the business lifecycle. One of those commonalities is that you will very likely work with several professionals externally, and there will be work done by several members of the family and/or the management team internally. We can call this your Transition Team for the purposes of this article, and how this team is selected will have a profound impact on your later results.
The very first step towards building a great Transition Team is to be intentional when choosing who to work with externally, and who among the family is designated to lead things internally.
Let’s start with looking at the external members of the team, which will usually include and accountant, a lawyer, and often a management consultant or advisor. These professionals will be instrumental in helping you make important decisions and plans. It’s worth the effort to make sure you are working with the best people for your situation.
It’s likely that you already have an established relationship with a team of professionals. And there’s a good chance that they can provide excellent service to you through your transition planning. However, it never hurts to take a step back, reflect, and intentionally decide whether to keep that relationship, or seek out a new one. Here’s a simple 3-step guide to help you add some intentionality to your decision.
First, write down some key attributes of what an ideal member of your external team would bring to the table.
- Do you need extra help to keep the family on track and making progress towards finalizing the plan?
- Do you require someone who has a more affordable cost structure?
- Are there unique aspects of your farm business, or family, that a professional would require, or benefit, from specialized experience to advise on? Perhaps at this point, you may identify that the familiarity of continuing to work with a trusted advisor that you have an established relationship with is one of the most important attributes – and that’s ok!
With these attributes in mind, step two is to create a list of options. You can use your network, search online, attend trade shows… it’s not difficult, although it might take some time. Remember, you have value as a potential client, so don’t be hesitant to request all the information you need to make your decision.
The last step in the process is to weigh your options and make a decision. As mentioned before, there is a good chance that the current team is up to the task, and no major changes get made. Remember that the effort you went through to arrive at that conclusion is not wasted. If you do make changes, that’s to the benefit of your farm and family. The team you have assembled now has a greater chance at being able to meet your specific needs.
Now, does the same process apply to the intentionality of choosing your internal team? In a nutshell, yes, albeit with a couple of important differences that are expanded on below. However, following the same basic process of identifying key attributes, identifying options, and then going forward with a decision, will have benefits in the long run.
The first difference between your external and internal team is that your internal team will be even more unique to your situation.
- Do you farm with extended family?
- Are partners and in-laws involved in management?
- What about non-family employees?
This article isn’t going to get into those topics, as important as they are. What is important to note, is that even though there are many differences from farm to farm and family to family, one common trait of families who successfully complete the transition planning process is that there is one person designated to champion the project. Keep in mind that “success” is defined differently by different people. “Success” in this context is that the farm family has developed a plan that gives them the best chance at achieving the intended outcomes that they identified at the start of the process.
So, with that in mind, how do you choose that internal ‘champion’ who will oversee the project? First, your options will be more limited when compared to choosing your external advisors. That much is obvious. Determining who will lead the project may be the most important decision you’ll make.
Why? Because if you’re not careful, you might overlook the best internal option. It is easy to just delegate this role to someone with less management responsibilities on their plate. It is easy for some members of the retiring generation to assume that they should take the lead since they have more experience. Simply put, it is easy to make an assumptive decision, and miss an opportunity to select the best … or most appropriate … person. Applying the same three steps identified above to your internal selection can help to counter that.
Taking some time to intentionally build your Transition Team may, or may not, result in significant changes as you head into the transition planning process. However, it will help you feel confident that you have assembled a team that will give you the best chance at completing one of the most important plans for your farm and family.
