If you own a family business, managerial succession and the transfer of that ownership can become quite problematic when they’re not planned out appropriately.
If you are a parent who owns and manages the business, there are probably other people who have a vested interest in that company of having an unchanged or uninterrupted operation of the company if you were to depart, whether by your own choice or due to death or disability.
There might also be those inside the company who desire change, sometimes for their own individual reasons, or for their perspective that it could help the company; and sometimes there is a strong leader already in the business who is able to view these competing interests together and can know how to successfully balance them.
After the death of one parent occurs, if there’s no effective plan B outlined in a succession strategy, other interest holders might become more vocal or active in the immediate aftermath. This could be business partners, children who are not in the business but are dependent on its success, a surviving spouse, children working in the business and key employees of the company.
Most of these interest holders will approach these issues with their own management and ownership perspectives and which they believe were not appropriately addressed by the parent.
Sometimes one or more of these interest holders could have been put into positions from which they can exert substantial influence over the outcome in the succession planning process. This can lead to further conflicts and a discontinuity in the operation of the business. It’s far better to have a business succession plan that is developed and prepared to be implemented well in advance. This can help to avoid many issues of family in-fighting or challenges and conflicts among stakeholders and the business.