family business matters

How (and Why) to Step Down Yet Stay Involved

By Tom Hubler, Executive Consultant

Jim was rightfully proud of his company. He had nurtured it from a garage start-up to an enterprise generating $40 million a year in sales. To ensure a smooth transition, Jim met monthly with Robert to review the company's performance. At one such meeting Jim noticed Robert's last item on the agenda: "Jim's Schedule." When they got to it, Robert said, "Jim, if I'm going to be successful around here, you can't be here as much."

Jim felt his face turn ashen. In shock, he thought, 'What will I do? The company is my life.' Then he thought about his hobby farm and his boat on Lake Michigan and decided, “ I'll be fine. I have plenty to do.”

A few months went by. Jim was having another monthly meeting with Robert, and the last agenda item again was "Jim's Schedule." When they got to it, Jim said, "Well, Robert, at least I'm doing a better job of not being around as much." Robert shook his head slowly from side to side.

Jim realized Robert was right. Although Jim wanted to turn his attention to his hobby farm and boat, he couldn't do it. Even though his continued presence in the company undermined Robert's leadership, he could not, in his mind, "quit" the company.

The decision to step down and retire is one of the hardest a family business entrepreneur ever makes. But entrepreneurs don't have to retire and leave their companies. Instead, they must change their job description. Jim should become the architect and designer of new ownership, management, and leadership systems. He should be the lead family member to organize and build consensus on family values and family philanthropy. He doesn't have to quit; he just has to lead from... MORE