Navigating Family Business Succession

Most of us have at one time or another faced a transition that seemed truly dauntingsomething that took us out of our comfort zones and made us question our abilities and limits.

In 2004, when I agreed to join Port Blakely Companies as the successor to CEO Jim Warjone, the challenge of successfully transitioning into the leadership role of my familys nearly 150-year-old business was overwhelming. But, like many large undertakings, the work of succession can become less intimidating and more manageable if you break it down into fundamentals, in this case by following three key principles.

1. Approach succession as a perennial priority. Many family-owned companies approach succession as an event that happens once in a generation. Owners should instead consider succession a dynamic, continual process. This approach means that the people within our business in all rolesfrom employees to owners to board membersshould have clear expectations about how transitions happen. This is especially true regarding the roles and transitions of family members working within the company. Transparency around transition builds trust and encourages productive dialogue throughout the company.

2. Create and follow a plan. Succession is less disruptive and leads to greater success when it is intentional and planned. Succession plans should be created as living documents that can be adapted according to need. They should also clearly define roles and how decisions are made between the successor and predecessor. Breaking succession down into phases with goals and implementing the plan in parts makes the task less likely to go off track.

Before my arrival at Port Blakely, the company had spent five years creating and implementing its succession plan. After my arrival, my transition to CEO occurred during the next five years. This time was critical for me to prepare for the executive role and the responsibilities that came with it. Our succession plan included a development road map for learning, both academically and experientially, within the business. This time was also critical for the company as the confidence of internal and external stakeholders had to be earned. A clear plan provided the framework for frequent and open dialogue where concerns could be addressed, accomplishments acknowledged and the next phase of transition set in motion.

3. Approach succession as a partnership. Like all great partnerships, successful succession requires those involved to establish a relationship built on trust, honesty and goodwill. The gradual process of one person moving into a role the other is leaving can be fraught with frustration, misunderstanding and conflict. But if the partnership is built on mutual respect and consistent demonstrations of trust, it can also be tremendously meaningful and rewarding to both people.

Succession partnerships built on solid foundations of shared expectations and principles foster open dialogue. Partners should be comfortable talking with each other candidly about how the succession is progressing and addressing issues that may come up that require clarity and agreement. While each partner has a distinct role in successionone conferring knowledge and insight to the other who is acquiring itboth have a responsibility to each other and the company, as well as to current and future family business owners.

My succession at Port Blakely was not without its challenges, but the wake behind it has been relatively calm. I attribute this to thoughtful planning and the lessons learned from others. I also attribute it to the support of the employees, family and board, and the shared commitment to following the plan with a partner who supported its success. Now, 18 months into my tenure as CEO, the companywide succession work continues as we roll out a strategic plan and shift the culture to adapt to todays market realities and ensure Port Blakelys legacy for another 150 years. This requires a great deal of advice and counsel along the way, which is part of the perennial approach to leadership transition and succession that will allow us and other family companies to endure.

RENE ANCINAS is CEO of Port Blakely Companies, which owns and manages operations in forestry, real estate and forest product exports.