Your new owner brings many wonderful strengths and experiences to your business, but there’s one thing they probably lack: the depth and breadth of the relationships you have invested years building and maintaining. They will never be just like you in those relationships and they cannot start with the depth of connections you have with your key vendors, customers and employees. This is a huge concern for a lot of owners because they have been the company’s primary external relationship builders. So how do you transition them to a new owner, to build trust and credibility?
Transitioning a Relationship to an Advisory Board
A second generation owner needed to transition the relationship with his Advisory board to his successor, a key employee. The advisory board had been in place since the owner’s father started the business, so the current owner (Jeff) did not seat the board. As a result, Jeff’s relationship with the board had always been tenuous. The new successor (Paul) didn’t yet have any relationship with the board. As an employee, he had an awareness of the board as they came to quarterly meetings on site, but had never met the board members. Now, with a transition around the corner, he needed to build a strong relationship with the board quickly, establishing credibility, trust and rapport so he could depend upon them and they could support him.
Initially, Jeff and Paul spent some time talking about the reason for the advisory board, the history and the contribution it could make in guiding the business, introducing qualified prospects, and providing support to for Paul. They also recognized the board could be a thorn in his side and difficult to manage if he did not invest in the relationships up front.
Because Jeff had somewhat tenuous relationships with the board, he encouraged Paul to meet one-on-one with each board member outside the meeting with a specific agenda. The agenda they crafted would give him perspective on who the most influential board members were, how the board operated, their priorities and goals for the business, and what they expected of him over the next 1, 3, 5 years. Asking these questions 1-1 and being open to the input created a high level of mutual respect and an understanding of the contributions of all involved.
Jeff also insisted that Paul attend the monthly board meetings and gave him targeted responsibilities, such as presenting the ‘state of the business’ and addressing key sales and operational challenges. He had him join the ‘Sales’ committee to more deeply understand how the board influenced the growth of the business. It gave Paul an opportunity to hear the conversations, learn who’s who in the community, and work with several key board members in a small group setting.
Within six months, Paul had established himself as a credible leader for the business, with the commitment of the full board to help him accomplish the business goals.
Transferring Strong Relationships in Your Business
How can you leverage this story to help your successor begin to build strong relationships with outside constituents?
- Share the history, value and purpose of the external constituent relationship to the company and to you as the owner. Identify reasons the relationship will be valuable to your successor too. Just remember, the value equation might be different for your successor. For example, you may have received value by the addition of complementary skill sets, such as strategic planning or accountability. Your successor may receive value from the networks the outside constituent may bring and their ability to tee up referrals.
- Give your successor a sense of the person -- and relationship -- their personality, priorities, nuances, challenges you’ve encountered in the past, etc..
- Provide targeted assignments to move the relationships forward. Paul was given responsibilities to present, join a committee, etc.. and that enabled the outside constituents to see him perform, learn his priorities and working style and assess ways to support him.
- Insist upon 1-1 meetings between your successor and key outside constituents so they can get to know each other without you in the mix. These meetings should have a planned agenda that your successor creates with input from you. Craft the agenda to ensure the relationships get built through the lens of the business. Don’t just suggest a round of golf. Go golf, but with a set of intentional topics to discuss.
- Be available to your successor to debrief from meetings to coach them on what they are learning from these meetings and how to use those learnings to be a stronger leader.
Paul was fortunate that Jeff was willing to set him up for a successful relationship with the Advisory Board. Because Jeff’s relationship had always been tenuous, it could have been easy for him to taint Paul’s experience of the board. Instead, he focused on what was best for Paul, the business and the board.
By proactively assessing the most important relationship transfers, you can establish a runway for your successor. And by the way, it’s not a bad idea to use the bullets above to strengthen your own partnerships … and while you’re at it, why not expand this concept and invite more of your team to expand their external relationships – customers, suppliers, referral partners. It’s usually a win for your business and a win for your partners.
Who are you going to connect with today?