Farm Succession is Simple When Family Members Communicate
I enjoyed speaking to audiences of farmers for a quarter of a century.
Each presentation is focused on elements of farm succession especially do-it-yourself business succession planning.
It has been my experience that creating agreement between and among the members of the farm family is the key.
With communication anything is possible, without it – nothing ever happens.
Not long ago I was asked to do an afternoon breakout session with a group of fifty business owners and their spouses at an ag association meeting.
As I mentioned – my message is always the same, I do change the title to blend with the group’s meeting agenda. This time the title was “Achieving Farm & Business Succession Success By Creating Shared Goals” among the owners of a family business, with a particular emphasis on how we can do 90% of the succession planning ourselves. Often just by setting critical goals and then working toward them.
There was a guy sitting in the third row who not only stayed awake throughout – he seemed very interested in everything I was saying. From time to time he’d look at me and then look at his wife. Over and over again, looking at me, looking at his wife. What was that about?
Once the session was over he asked for my business card. That’s not unusual because we had connected on some level and I figured he was just being polite. Really, if I had a dollar for every time somebody asked for my card… Most of the time people ask out of a sense of obligation or good manners, and have absolutely no intention of ever calling.
Surprise surprise – a few weeks after the meeting Ed sent me an email. He wasn’t ready to hire me or anything, he just wanted me to know that if I was going to be in their part of the country any time soon, I should let him know because he would like to meet with me.
When I realized that I was going to be in his area for a couple of days between some other meetings, I called him for an appointment.
When we spoke at the farm that day it all came out. The reason he was not ready to hire me or anyone else was that he had tried to take steps in the past and each time his efforts were sabotaged – his wife refused to sign off on any distribution that did not divide their assets, including the farm and everything associated with it – 1/3, 1/3, 1/3 between their two sons who were long time members of the farm’s management and their daughter living in a different state – single and in grad school.
At the end of the afternoon I had spoken to the boys, ages 28 and 32, who were frustrated that their sister was going to get one third of the growth that they had and would continue to create.
Their mother was bound and determined that her daughter would get her equal share no matter what. And dad was not going to put the boys in the position of having to buy back 1/3 of the farm from their sister after they had worked there for who knows how many years.
The quandary about treating the children (no matter how old they are) fairly when it comes to succession and inheritance is one of the principle stumbling block to farm succession planning. It is often the foundation of the “wait and see” approach that can so quickly lead to family, business, and financial disaster.
So, how’d it all work out? Simple. I went to the college where the daughter was a grad student and explained the situation to her. What she said was eye opening. She was never going to come back and be part of the farm operation. She was engaged to a medical student and their plans would take them far far away.
Also she said that her mother was upset because her brothers had inherited the farm and she had been left out. Her brothers were running the place and her mom had already married her dad. She received a lot of money as her inheritance, her fair share, but it was the fact that she was never told anything about how it was all going to work out before her parents died.
And finally she said that she felt good leaving the area with her soon to be husband because she knew her brothers would be there for her folks from now on. She did not want to do anything that would keep them from being as profitable as possible.
That night after I left she wrote a letter to her mother telling her everything she’d told me and as soon as her mom and dad read it, they set up an appointment with their advisors so they could begin taking the steps right away that would see to it that everyone’s dreams for the future would come true.
If you are a farmer you know that every slight, every misunderstanding, and every unexplained feeling evolve into a web that seems at first too complex, too sticky to solve. And yet, when people do talk – it can make all the difference.
When Don Jonovic PhD and I wrote “Passing Down the Farm the OTHER Farm Crisis”, in 1986 – based on my experiences helping farm families plan for the future of their business during and beyond their lifetimes and Don’s insights into family business dynamics. We submitted a draft of each chapter to a panel of farmers, ranchers, and agribusiness owners – who checked it for accuracy and clarity.
The result. It was packed with universal truths about relationships and the need to take charge of the activities that surround planning for the future of the farm. It remains a favorite of farmers and their advisors to this day.
When I decided it was time to create a version for the new millennium, we first had to ask and answer three important questions. “In two decades, what’s changed, what’s stayed the same, and what should we do?”
If you are serious about farm succession, or if you are a professional involved in farm succession planning – or an farm association executive, click the link below to learn more about Passing Down the Farm in the 21st. Century©.
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Although not specifically referencing farm succession planning these articles and the subjects they direct us to are relevant to each one of us. Since we went online in 1999 we have continuously brought big city ideas that can be adapted by the rest of us to Main Street. Here are sone examples.
- articles on interest – organization: american hospital association building leaderful organizations; succession planning for nonprofits http://www.aecf.org/~/media/publicationfiles/building leaderful organizations.pdf presents emergency succession planning …
- Disaster Management and Scaling Big – As soon as I read this sentence I knew I wanted to talk about disaster management and scaling a business. From an entrepeneur’s perspective, disaster management is a tough thing to deal with. Often we don’t bother at all, or we do very little; we’re too engrossed in launching our new business and generating sales that disaster management is a low priority.
- Enthusiastic Geniuses and Irrepressible Entrepreneurs – Want your story heard? Want to get into a book? Now is your chance! Greg Balanko-Dickson is writing a new book on genius and irrepressible entrepreneurs. A quick quote from Greg: There is just something about a genius that makes me …
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- Farm Succession and Strategic Planning Group
[...] Farm Succession is Simple When Family Members Communicate By now you’ve had at least one family meeting, hopefully appointed someone willing to act as the “planning coordinator” to help manage the flow of the process, and you now have a better idea how to identify what’s important to each of you. [...]