The DIHK Action Day on Corporate Succession in Bavaria and Munich shed light on the question of how a generational change can strengthen the innovative power of a company. After all, a professionally managed business succession process can have a positive effect on the innovative spirit in the company.
Markus Neuner is the head of the corporate law and succession department at the Chamber of Industry and Commerce for Munich and Upper Bavaria. In this capacity, he introduced the three speakers and succession specialists Beatrice Rodenstock, Holger Habermann and Roland Greppmair to 40 guests a few days ago. He pointed out the importance of successful company transitions for the Bavarian economy and the economic benefits. Because nationwide, about 100,000 companies and about 800,000 jobs will be affected in the next two years. Meanwhile, the ever-aging handovers are often a sign that the search for a suitable successor and, if necessary, its development is not started early enough. In his experience, the emotional component is often underestimated.
This is exactly where the speakers started in the core of their lecture. They used the metaphor of the iceberg model several times. This clearly illustrates how important it is to look at the 90% below the surface of the water. What was meant were the unconscious aspects such as wishes, expectations and fears. Because these require an honest look and communication on the part of the transferor and the potential transferee. Another major concern of the speaker was to look at the company’s perspective. What does the company need?” was a key question that repeatedly accompanied the 90-minute lecture.
Mountain climbing as a metaphor for business succession in Bavaria
In keeping with Munich and the topic, the audience was taken on a mountain hike. This demonstrated what a strenuous undertaking one embarks on with a business succession. In addition, one needs stamina and the world at the summit is a different one than at the starting point down in the valley.
Roland Greppmair, the value-oriented succession advisor, begins by making it impressively clear in what context companies find themselves today.
The rapid change is triggered by disruptive technologies that make different business models possible in the first place and massively increase customer benefits. These are all circumstances that can often quickly become fatal for companies. Kodak, Nokia or Polaroid are cited as three examples of many that have not survived the change. It is precisely in this context that corporate succession is a real opportunity,” he says. In this respect, finding an answer to what one’s own company really needs in order to remain viable.
There are four phases into which each succession can be divided. Knowing full well that each is very individual in nature.
Phase 1: The orientation phase
has the goal of creating an optimal handover scenario. Holger Habermann from KERN Unternehmensnachfolge. Erfolgreicher accordingly made it clear that the most important component in this phase is time.
Sparring partners can help to reflect accordingly. Beatrice Rodenstock mainly deals with family businesses in her consulting work. Here in particular, three perspectives play a role in one and the same person, both for the transferor and the transferee. The family, the company and also the view of the shareholder who has invested capital in the company. Three perspectives that you cannot always do justice to. Has the optimal transfer scenario finally been determined?
Phase 2: The planning phase
Their goal is a binding plan, agreed with all parties; the script for the actual handover, so to speak. In this phase, the high complexity of such a succession usually becomes clear. As a result, professional assistance is usually worthwhile. After all, all this has to be managed in addition to the day-to-day business.
Especially the successor asks himself: “What am I actually taking over here? A risk assessment makes sense. How does the company stand in the market? What are the legal, tax and financial risks? Roland Greppmair explicitly points out the corporate culture. What makes the employees tick? What is the management culture? Does it suit me as successor?
As important as this planning phase is, the handover is still pure theory. That changes quickly in
Phase 3: The handover phase
at the end of which the transferee actually runs the company. The challenge in this phase is to manage conflicts. After all, one was often allowed to determine the fate of the company for decades by making one’s own quick decisions. However, this competence often turns out to be the exact opposite when the company is handed over. Beatrice Rodenstock and Holger Habermann are sure of one thing here: appreciating each other is an important key to avoiding conflict.
For the company, trust in the new leadership is particularly important. That must be goal N°1 for the successor, says Roland Greppmair.
If this phase has been managed well, the successor has made it! Now he determines the future fate of the company and can breathe life into his visions and ideas. That is why the last phase of the mountain hike is no less important.
Phase 4: The postal handover
The acquirer leads the company strengthened into the future. According to the three speakers, there are four prerequisites for this:
- The successor is in office at 100%.
- A sustainable business model has been established.
- The corporate culture carries the vision, mission and business model.
- There is confidence in the new leadership.
In this way, an old stability becomes a new stability for the company. And this stability allows innovations to flourish again. It thus forms the basis for a successful future.
Despite summer temperatures, all listeners were captivated by a succession process with a focus on the essential. The human being! Role plays, authentic examples from practice and a dynamic form of presentation made the evening a real experience.
About the speakers:
Beatrice Rodenstock, Dipl.-Soz. and systemic coach, is managing partner of Rodenstock ? Gesellschaft für Familienunternehmen mbH. She supports entrepreneurial families in change processes in the areas of succession and the development of family, company and family office strategies.
Holger Habermann is a partner of KERN Unternehmensnachfolge. Successful in Munich as well as a systemic coach. He assists entrepreneurs with company succession as well as with the sale and purchase of companies in Munich and Upper Bavaria.
Roland Greppmair is a systemic coach and expert for value systems and corporate culture. He accompanies the transferor, the transferee and the company during and after the transfer.
Reviews:
“Thank you very much for your innovative contribution to our nationwide DIHK action day “Company Succession? Focusing on the “soft” topics is in line with our experience of what makes a succession successful. The four phases provide structure and orientation in a very complex process. Gladly again on another occasion”.
Markus Neuner, Chamber of Industry and Commerce for Munich and Upper Bavaria
“Great idea to wrap up business succession in a mountain tour. I know from my own experience with succession that it is exhausting. That’s why the four-stage process presented makes a lot of sense and creates order. Captivating and lively presentation garnished with many practical examples. I can only say: top speakers, top event”.
Marius Elgershäuser, entrepreneur from Munich
Tips for further reading:
Family-internal business succession: The four most important questions
What are the advantages of succession advice for a family business?
How do you recognise a reputable business sale advisor?
Mediation solves conflicts in business succession
Why a Letter of Intent (LoI) is worth a lot for buyer and seller
When should employee information be provided in the event of a company sale?
Successfully selling IT companies
Free webinars on business succession
Image: © Author
Emotional aspects are often underestimated in business succession. It’s like an iceberg: 90% of the emotions are not immediately visible. They lie beneath the surface of the water. These include, in particular, wishes, expectations and fears. But succession can also be described as a mountain climb. After all, handing over a business is no less strenuous. It also requires a lot of stamina. On the other hand, the world at the summit is quite different from the one at the starting point in the valley.
1. the orientation phase: the aim here is to create an optimal transfer scenario.
2. the planning phase: In this phase, the “script” for the handover is developed.
3 The handover phase: At the end of the handover phase, ideally the transferee manages the company. Mutual respect helps to overcome conflicts.
4. the post-transfer, at the end of which the acquirer leads the company strengthened into the future. To do this, he must be firmly in the saddle and carry the corporate culture vision, mission and business model. Furthermore, there must be a sustainable business model and trust in the new leadership.
