Pierre  Arcand  Coaching 

Family intergenerational company transfers "check-list" :

(During the next 10 years, many baby boomers will go to the process of transferring the company that they have spent a lifetime creating. This article will deal specifically with family intergenerational company transfers.

There are two general types of intergenerational transfer:

    ·       Farmland
    ·       Company

   * Farmland transfer is a specific situation that requires special financial handling with severe fiscal implications that we will cover in another article.

  * Company type transfer is a process that requires both the transferor and the receptor to deal with complex financial and emotional problems.  

The transferor has to:

   ·      Select who will take over the company’s affair:
         *  To select the best candidate(s) to take over the company the owner needs to put aside is emotions and determine who has the qualifications and capacities to manage the organisation. This is key to the success of the process.

  ·      Deal with the perception of fairness with the other members of the family:
        *  Once the selection of a successor is made, the owner is often confronted with the perception of fairness with the rest of the family. Fair does not mean equal.

  ·     Create a knowledge and financial transfer program:
       *   To be successful, the transfer must deal with the knowledge and culture of the organisation as well as with the shares and financial arrangement of the transaction. The fiscal aspect is where most owners are at ease. Their company’s accountant, lawyer and financial advisor usually support them. The transfer of knowledge and company culture is where most deals run into troubles. The owner must identify what makes his company unique, and must learn to delegate this magic recipe effectively.

·     Decide on a transfer date:
      *  The owner must set a timeframe to execute this transfer and stick to it. Dates need to be communicated to employees, financial backers, suppliers, customers, etc.

·    Plan his future involvement in the company:
     *  The owner’s future plan must include the cessation of power and the selection of the role to be executed in the future (member of the board of direction, family council, selected role in the company. none, etc.)

·    Execute the plan:
    *   Most owners have to deal with many emotions during this period, and the temptation is great to hang in and stall the process.

·      Surround  himself / herself with a team of experts to assist in the process.

The receptor has to:
·      Accept his (her) future role:
      *   It is one thing to be selected, but it is vital to the process to own the future responsibility. If the passion, that motivated the owner, is not present in the successor, the transfer is doomed.

·      Master the skills of his (her) future position:

      *  You do not inherit knowledge, you have to learn and master the new position. This usually requires years of involvement in the company or specific training to get the skill required to lead the organisation.

·     Identify funding sources:
      *  Depending on the situation, the new owner may have to identify how he (she) will raise the required capital to execute the financial transfer.

·     Learn the company’s culture:
      *  Most organisations think of the financial, legal, fiscal implications of the transfer, but forget the essence of the company’s culture. This culture is what secure the employee’s and customer’s loyalty, and if not properly transferred, it can damage the organisation future.

·      Deal with the other family members:
      *   As the selected leader, your role is to deal effectively with the rest of the family’s reaction.   You need to be sensitive to the emotions that this transition can create with the ex-owner, mother, siblings, spouses, etc.

·     Win over the employees, clients, suppliers, bankers, etc. :

      *  To achieve a smooth transition, you must win over the majority of key individuals, important to the company’s future. You have to reassure them and get them to share your vision for the future of the organisation.

·     Remain open, sensitive and collaborative during the transfer process:

      *  No matter how prepared you may be, unforeseen events will surprise you. You must show leadership and control during these events and establish that you are the right candidate for the job.   

A poorly executed process can lead to:
    ·       Impaired company operation
    ·       Family feud  
    ·      Loss of key employees
    ·      Closure   

Since this is usually a ''once in a lifetime event'', to execute this transfer and to increase the chance of success, the transferor must surround  himself / herself with a team of experts to assist in the process. 


Our team of coach,  mentor , lawyer and accountant can assist you and your family in this delicate transfer.

We will guide you with every step of the process. 

Contact us to learn more! 


Intergenerational transition

Did you know that?

Over the next 10 years, baby boomers will transfer to their successors, the company they founded.

This process can be damaging if poorly prepared or poorly executed. To minimize risks and complications during this critical period for a company and its leaders, it is advisable to be accompanied by a business coach for the ''how to’’ component and a mentor for the ''emotions'' aspect.