Has the transmission process for the company been initiated?
This Shopping List is an awareness raising tool used to initiate the succession planning process.
This is by no means a test, but a tool to begin exploring, thinking and determining where you are in the process.
Most of the time this tool is used for family successions or management buyouts, but it can also be used in other situations, such as a purchase by a third party.
Even though most transitions are family successions or management buyouts, this tool can be used for other situations, such as a purchase by a third party.
The four positions from which the process can be initiated are: the owner-manager, the successor, the state of the company, and the transfer of ownership. The Shopping List can be used to evaluate the overall dynamics of the transfer by looking at the four starting positions all together, or only one or two of the starting positions.
Note that the terms "owner-manager" and "successor" can designate one or more individuals, depending on the type of succession.
The "owner-manager" designates the actual owner(s) of a business to be transferred.
The owner-manager might be a father and head of a family business, the manager of a non-family business, or a group of partners.
Ultimately it means the assignor(s).
The "successor" designates the future manager(s) and owner(s) of the company.
It might be a child, siblings, a manager or group of managers, or a combination of several types of successors.
It might even be a third party, such as an individual or business outside both the family and the company.
In this last case, certain points will seem less pertinent and will therefore affect the scores of the four dimensions. However, the score will still provide insight on at least one of the dimensions. Transferring to a third party is quicker than transferring within a family or to company management because the owner-manager does not need to prepare his successor. The acquirer's interests are mainly focused on the transfer of ownership.
It is clear that an outside successor who was never involved in the targeted company does not have access, or has only indirect and limited access, to some of the target company's information and network. The successor should consider this obstacle and how to overcome it.
* To identify the progress of the succession process is in the company you want to assign or that you would like to take over, calculate the score of the items on the Shopping List.
The resulting percentage is an indication of how far along the process is. Get started with these points!
The ratings are:
(1) Original version available in "Préparer la relève - neuf études de cas sur l'entreprise au Québec" by Louise St-Cyr and Francine Richer, Presses de l'Université de Montréal et Presses HEC, Paramètres Collection, 2003, p. 199 à 201.
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