Handing over a company is one of the most critical and most emotional phases in the life cycle of any business, particularly in small and medium-sized companies and in family businesses. Passing a life’s work on successfully, to the next generation or to an external successor, does not only secure the future of the firm and of its jobs, it is also of great value to the owner handing it over. Succession planning is complex, though, and it holds many challenges, from legal and tax aspects through the choice and induction of a suitable successor to dealing with emotional hurdles on both sides. Specialised succession coaching can play a decisive role here, in shaping the generational handover professionally, avoiding the typical pitfalls and working out a solution that satisfies both the owner and the successor.
This article looks at the many layers of business succession, at the typical challenges and at how focused coaching can support you in making this important transition a success.
The complexity of handing over a company: more than a change of owner
Business succession is far more than the transfer of ownership shares. It touches a number of levels:
- Strategic level: What does the future direction of the company look like? What is the vision of the successor? Do the strategic goals of the owner and the successor fit together?
- Operational level: How is the day-to-day business handed over? How is the successor brought up to speed? How is the know-how secured inside the company?
- Financial level: How is the value of the company determined? How is the takeover financed? Which tax aspects have to be considered?
- Legal level: Which contracts are needed (purchase agreement, shareholder agreements and so on)? Which liability questions have to be settled?
- Emotional and personal level: For the owner, succession often means letting go of a life’s work and redefining their own role. For the successor it means taking on great responsibility and often stepping out of the shadow of a predecessor. In family businesses in particular, personal relationships play an important part, with all the advantages and disadvantages that brings.
- Employee level: How do the employees react to the change? How can their uncertainty be addressed and their loyalty to the new owner secured?
- Customer level: How do customers react to the change? How can their uncertainty be addressed and their loyalty to the new owner secured?
Given this complexity, early and professional succession planning is indispensable.
Typical challenges and pitfalls in business succession
Without careful planning and support, the succession process can fail in many places or lead to considerable problems:
- Starting too late: Many entrepreneurs begin planning their succession too late, which increases time pressure and narrows the options.
- No suitable successor: Finding a qualified successor who fits, whether internally (family, employees) or externally, is often difficult.
- Unclear expectations on the part of the owner: Some owners find it hard to let go or have unrealistic expectations of the successor or of the sale price.
- Insufficient induction of the successor: A handover phase that is too short or too thin can overwhelm the successor and put the success of the company at risk.
- Emotional conflict: In family businesses especially, unspoken expectations, rivalries or different ideas about the future can create serious tension.
- Underestimating the financial and legal complexity: Mistakes in valuation, financing or contract design can become expensive.
- Gaps in communication: A lack of open communication between owner, successor, family and employees leads to misunderstandings and uncertainty.
- Resistance among employees: If employees are not informed and involved in good time, fears and resistance can build up.
Our coaching is designed to address these challenges proactively and to develop solutions for them.
How succession coaching makes the transition work
As a succession coach I act as a neutral moderator, adviser and companion through the process for everyone involved. As an external sparring partner I bring a certain objectivity, which makes it easier to discuss emotional topics calmly. My experience from many handover processes is a resource that all parties can draw on.
I support the process in several phases:
1. Coaching for the owner handing over:
For an entrepreneur handing over a life’s work, this is often a profound break. Coaching helps the owner to:
- clarify their own role and vision for the time after the handover: what comes next, and how can the transition also work well on a personal level?
- develop realistic expectations of the succession process.
- learn to let go and build trust in the successor.
- develop a clear strategy for the handover: timeline, criteria for choosing the successor, shape of the induction phase.
- work through the emotional side of saying goodbye.
- shape the communication with family, successor and employees constructively.
2. Coaching for the successor:
The successor faces the challenge of taking on great responsibility and leading the company successfully into the future. The coaching process helps here:
- to reflect on and strengthen their own role and leadership.
- to prepare for the takeover and get up to speed.
- to develop their own vision for the company.
- to earn the respect and trust of the employees.
- to clarify the relationship with the (often still present) former owner and to set their own accents.
- to work out strategies for developing the company further.
- support through implementation and advice in difficult situations.
3. Coaching for family businesses in succession:
In family businesses, business and family matters often mix, which makes the succession process particularly complex. As a coach I frequently take on the role of the neutral mediator and can help to:
- encourage open and honest communication within the family.
- define shared rules and criteria for the succession.
- recognise potential conflicts early and moderate them.
- take the interests of all family members into account, including those who do not join the business.
- support a clear separation of family and business roles.
4. Guiding and moderating the process:
A coach can structure and moderate the entire succession process:
- drawing up a detailed succession roadmap.
- supporting the choice of a suitable successor, for example through potential analyses.
- moderating conversations between owner, successor and other stakeholders.
- accompanying the induction phase and the transition.
- conflict management and mediation where needed.
- making sure that all relevant aspects are covered: strategic, financial, legal and emotional.
The building blocks of successful succession coaching
A typical succession coaching process includes:
- Taking stock and clarifying goals: analysis of the starting situation and of the expectations and goals of everyone involved.
- Strategy development: discussing the current strategy (vision, mission, values), adjusting it for the next phase where necessary, and agreeing on a timeline.
- Communication planning: deciding how and when family, employees and other stakeholders are informed.
- Building competence: focused coaching to strengthen the leadership, communication or conflict resolution skills of the owner and of the successor.
- Handing over the systems: making processes and systems visible and discussing them, so that the operational handover runs smoothly.
When is the right time for succession coaching?
The answer is simple: as early as possible. Ideally, entrepreneurs start with strategic succession planning and coaching support five to ten years before the planned handover date. That leaves enough time to prepare every aspect carefully, to find a suitable successor and bring them up to speed, and to run the process without unnecessary time pressure.
Even when the process is already under way or the first difficulties have appeared, coaching can still be valuable, to correct the course and secure a successful handover.
Conclusion: mastering business succession with coaching
Business succession is one of the greatest challenges in the life of an entrepreneur. Specialised coaching gives you the professional support you need to master this task. It helps you to avoid the typical pitfalls and to find solutions that do justice to the interests of the owner and of the successor as well as to the future of the company.
If you are facing the task of planning a generational handover in your small or medium-sized company, or if you are already in the middle of the process and looking for support, simply send us a message.
Invest in professional support. It is an investment in your life’s work and in the future of your company.
Succession arrangements: the available routes
Before talking about advice, it is worth looking at the basic forms a succession can take. They differ less in the contract than in what they demand of the people involved.
Handover within the family
The classic route, and the one with the most emotional charge. The successor is a son or a daughter, which makes the professional induction easier and the clarification of roles harder. A neutral sparring partner is particularly valuable here, because parent and child rarely talk openly about their doubts.
Handover to an employee (MBO)
A long-standing employee takes over. The advantage: they know the business, the customers and the team. The challenge: the financing, and the shift in role from colleague to boss. Both can be prepared for, if you start early enough.
Sale to an external successor
Here several specialists usually work together: M&A advisers to find a buyer, tax advisers for the structure, lawyers for the contract. What is often missing: someone who accompanies the owner through the months that follow.
Handover to a foundation or an investment company
For larger businesses without a successor in the family, this is an option that secures continuity. The effort in planning and advice is considerably higher and the lead time correspondingly long.
Which route fits is rarely decided by numbers alone. It is decided by what matters more to you: the best price, keeping the jobs, or the company keeping its name.
What a business succession adviser actually does
The term business succession advice is used for very different things. Tax advisers and lawyers settle the legal and fiscal construction. M&A advisers look for a buyer and negotiate the price. Both are important, but they only cover part of the picture.
The gap lies in between, with the people. An adviser who accompanies the succession as a process works on the questions for which there is no contractual clause:
- When is the owner really ready to let go? Many handovers fail not because of the contract, but because the senior keeps making the decisions after signing.
- Is the successor prepared for the role, and not only professionally? Professional competence is rarely the problem. Leadership, authority in front of long-standing employees and dealing with their own expectations often are.
- How do the employees find out? The timing and the manner of that communication decide whether your key people stay.
- What happens to the owner afterwards? Someone who has been the company for thirty years needs an answer to the question of what comes next. Without that answer, letting go is hard.
A good business succession adviser replaces neither the tax adviser nor the lawyer. They make sure that the work of both rests on solid ground.
Frequently asked questions about business succession advice
What does advice on business succession cost?
That depends very much on the scope. Occasional support with individual sessions costs considerably less than accompanying a process over two years. Serious advisers give you a range in the first conversation and are transparent about what it includes. Be careful with offers that name a flat fee without knowing the scope.
When should I start planning my succession?
Five to ten years before the planned exit. That sounds like a lot, but it is not: finding a successor and bringing them up to speed alone often takes two to three years. Anyone who starts at 63 is choosing between time pressure and compromise.
What is the difference between advice and coaching in a succession?
Advice contributes experience and recommendations: the adviser says what makes sense from their point of view. Coaching works with questions and helps you to find your own answer. A succession usually needs both, and someone who knows which approach is called for when.
Can an adviser also mediate when there is conflict in the family?
Yes, that is one of the most common reasons why external support is brought in. An outsider can name positions that have gone unspoken within the family for years. What matters is that everyone involved accepts them as neutral, and that has to be settled at the start.
How we accompany you through the succession
AHA Factory accompanies owners in the border triangle around Basel through the generational handover, from the first thought to the actual transfer. We work with both sides: with the owner who has to let go, and with the successor who has to grow into the role.
More about how we accompany a business succession or go straight to arranging a first conversation.
Related topics: Business coaching for entrepreneurs · Strategy development · Succession support
