July 24, 2017 --  "Adding Value to your Business
           "Adding Value"
"In order for the next generation to be successful in your business, they must learn to "add value" to the company. Too often, the senior generation does not hold the next generation accountable to increase the worth of the company. They give or sell the business to their children without any total company performance requirements. Without learning how to grow sales and profits, and effectively managing both, there is no real value added. 
         "Teaching Tasks is not enough"
In most family businesses we have worked with, we find the
next generation are being taught tasks. Tasks that are specific to one area of the company and usually identified as needed by the senior generation. It may be sales, or inventory control, watch repair, or machine maintenance, etc. depending upon your industry. Rarely is there any coaching or teaching of how to add value to the company by increasing total company sales and profits. Adding value should involve the next generation's responsibility to "add to" the current profit and sales stream. The have to be accountable to effectively growing the business, by demonstrating they are learning how to do so for the entire company. . . The big picture perspective.

Too often the next generation is given ownership without any performance requirements or understanding of what knowledge and effort they need to possess to actually grow the total business. . .to add value. Yes, I am for successors learning as many tasks in the company as they can as it enables them to understand the internal functions better. That is great, but it is not enough. Knowing how to select and manage the right people, how to budget, how to control expenses, how to "add to" the current sales and profitability of the company, is essential to long term success and survival.  
big picture
         "Prove it"
Even if you desire to "gift" the company to your children, they need to have some "skin in the game" by obtaining shares only as they add value. They need to demonstrate their knowledge of managing people, while growing the sales and profits. They need to prove it, otherwise you have a legacy that will be on the shoulders of someone who never quite gets the "Big Picture."
             "Transforming Family Businesses"
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Kwaiserism - "Teach successors to "add value" and
                                                                      they will manage better businesses."