Succession planning is a complex and often emotional process for family-owned businesses. In the compressed & cryogenic gas industry, where many companies are family-owned, it's even more critical to have a thoughtful and strategic plan in place for transitioning leadership and ownership. In a recent podcast, Abydee Butler Moore from Butler Gas, shared her insights and experiences on succession planning in family businesses.
Abydee started by emphasizing the importance of building a foundation of trust in any family business. When tough conversations arise, it's essential to remember that each person may be coming from a different "bucket" - family, business, or ownership. She believes that healthy conflict is possible when there is a strong foundation of trust. She also highlighted the value of using a strategic planning methodology, such as Traction, to guide decision-making in family businesses.
Butler Moore acknowledged that only 12 percent of family businesses are successful through the third generation. As such, it's critical to have a clear succession plan in place that considers the needs of both the business and the family. They believe that it's essential for minority owners to have a way out if they want to exit, and they compensate people for the roles and functions they perform operationally.
According to Abydee, the best advice they received came from their grandfather, who encouraged them to get involved in trade associations. They also believe that it's important to take control of passing the torch when it's on your terms, build a team around you that complements your strengths and weaknesses, and be ready to take on important assignments.
Abydee also highlighted the importance of finding the right skill set for the next generation of leaders. They don't believe that a 50/50 ownership model is healthy for an organization that needs a leader. They also emphasized that a succession plan is not just about ownership but about the entire organization going through a transition.
Finally, Abydee discussed the need for the industry to focus on succession planning, given that it is getting younger and more demographically diverse. They believe that the next generation should volunteer and learn by assimilating into the industry, but they can't control the exit plans of the senior generation.
Overall, Butler Moore's insights provide valuable guidance for family-owned gas distributors looking to navigate the complexities of succession planning. By focusing on building trust, using a strategic planning methodology, and finding the right skill set for the next generation, family businesses can successfully transition leadership and ownership without hurting the business entity.