Every business has special needs to succeed in future generations. Competent management, cooperative ownership with similar goals for the business, and proper capitalization are absolute necessities. Management by consensus usually does not work when family issues are involved. Disharmony can destroy a business, which is not fair to anyone. A fourth mistake is using the wrong advisors.
Succession planning requires the most competent advice available.
Most of the time, getting this advice means creating an estate planning team. Your team might include a specialist in estate planning, a business attorney, a Certified Financial Planner or Chartered Life Underwriter, a family business consultant, a tax specialist, and even a family systems expert. Because each family has its own unique dynamics, a family systems expert may be able to understand how to work within these dynamics to produce cooperation and understanding. The fifth common mistake in passing a business to children is not having a contingency plan. This planning involves a comprehensive look at your business and personal financial risks to assess both the best possible outcome and the least desirable outcome.