The Declaration of Independence is rightly called the founding document of the American political tradition; it articulates the fundamental ideas that form the American nation. As a practical matter, the Declaration of Independence announced to the world -- and shouted to Great Britain -- the unanimous decision of the colonies to separate themselves from the British monarchy. Its revolutionary significance, then and now, is that it declares political legitimacy among sovereign people. Considering the circumstances surrounding its writing, the document is all the more remarkable. The American colonists, ravaged by war against the Brits, stood boldly against a staunch monarch, steeped in tradition and vowing to maintain rule over the colonies. King George III rebuked the "misguided Americans" and "their extravagant and inadmissible Claim of Independency" (sic), and urged them to "...reflect seriously upon their present Condition and Expectations, and to judge for themselves whether it be more consistent with their Honour and Happiness to offer up their Lives as a Sacrifice to the unjust and precarious Cause in which they are engaged…" In other words, he told Americans to give up this silly idea completely or face dire consequences. Lucky for us, no one listened.
As I celebrated the 4th of July with my family this year I reflected on an article I read recently by our good friend James Lea. James is a business advisor to family owned companies and closely held businesses and drew a parallel recently between the signing of the Declaration of Independence and an individual's decision to leave the family business. It may seem like a stretch but James is absolutely correct. Though leaving the family business will not likely be met with threats of death, imprisonment, loss of home, and poverty -- common consequences for the patriots -- there is a declaration of independence to be made, a standing against tradition, and a need to persevere despite great opposition. The pursuit of happiness comes at great cost.
Having said that, leaving the family business can be the best decision you ever make. So how can you do it successfully? There are two ways to leave a family business: as an employee or as an owner. In both situations, how you exit is equally as important as why you leave. Let's explore both scenarios.
Leaving Employment
If you no longer feel that you can meet your career goals at your current job, then it's time for a change. Keep in mind, however, that leaving employment in the family business must be handled with particular grace so that relationships can remain intact. Achieving this outcome requires you to more fully communicate your thoughts and goals to your family enterprise than if you worked for an outside company. Be clear about what you are striving towards and show appreciation for what you have learned. Here are a few tips:
1. Don't leave in a huff or on the worst business day of the year. Remember, salvaging your relationship is priority.
2. Be sure you are moving toward something that will fulfill you personally. Do not seek to go into direct competition with the family business.
3. Determine who can take over your responsibilities. Your successor should have all the skills and capabilities to be productive in the new role. Stay long enough to train the new person and get him or her prepared.
4. Plan your exit carefully. Consider how and when you will tell the staff about your exit and when you will inform external contacts like vendors and customers. Your departure will significantly impact these relationships, so don't neglect them. Be realistic about the extra time leaving a family business will take.
5. When you're gone, you're gone. Do not expect the family business to be your fallback if your new venture is not successful.
Leaving Ownership
Exiting your business takes particular consideration. We have several resources on our website available here, as well as a three step process for getting started. I encourage you to read them both and schedule a time to meet with us to begin your exit plan.
