One of the clients my father and I advise really understood the competitive advantage he obtained by implementing a comprehensive succession plan that dealt with both the business and the family. But he actually took this to a whole new level when he asked us if we would be willing to sign an agreement stating we would not develop a succession plan for any other family business in his industry. When we asked him why, he said he understood what an advantage he had now that he had a comprehensive plan managing both the business and his family. His idea was to wait until the other family businesses in his industry were struggling, at which point he would purchase them at a bargain price. Since our goal is to help as many clients successfully transition their business to the next generation, we declined his request. However, in the mind of this family business owner, he clearly had a competitive advantage he was willing to try to exploit to the fullest.
Family businesses that are able to effectively harness their unique attributes have the potential to grow in value and create sustainable competitive advantages. Those who have successfully done this can dominate their markets and continue for many generations.
Danielle Walsh is founder of Walsh Family Business Advisory Services, a consulting company specializing in assisting family-owned and operated businesses navigate the rough waters of management and ownership succession. She is a certified public accountant (CPA), chartered accountant (CA), and holds certificates in Family Business Advising and in Family Wealth Advising from the Family Firm Institute (FFI). Walsh developed her philosophy and desire to help family businesses from her father, Grant Walsh, who has worked as a family business practitioner for the last 25 years. She is also currently teaching the first family business course offered at the undergraduate level at Carleton University in Ottawa. Walsh can be reached via e-mail at danielle@walshfbas.com.
