Succession planning for success

(Source: http://www.abc.net.au/rural/content/2013/s3710446.htm?site=newengland)

If you have 10 minutes to spare why not make a cuppa and sit down and listen to this interview with Lisa Herbert (ABC Rural) and our 2013 NSW-ACT RIRDC Rural Women’s Award finalists, Isobel Knight.

Succession planner Isobel Knight says preparing a plan can have great financial benefits (Lisa Herbert)

Succession planner Isobel Knight says preparing a plan can have great financial benefits (Lisa Herbert)

Not many farmers like to think about what will happen to their business when they get a little long in the tooth. That’s why less than 10 percent of farming families take part in succession planning.

Succession planner Isobel Knight says the process isn’t only about just ‘who gets what and when’; it’s about business continuity.

Mrs Knight from Loomberah, near Tamworth in northern NSW, started her business proAgtive 10 years ago.

“We could see there was a massive area of need. The complexities of it were not understood well.”

She says succession planning is about transitioning the business from one generation to the next, without sacrificing business growth.

“We need to focus on management transition and leadership transition. The ‘who gets what’ sits in the estate plan as we work through our lifetime, and a succession plan should go hand in hand with an estate plan.

“A lot of people don’t want to do a succession plan because they think it gives them a use-by date.”

But that’s not the case.

“Good succession uses the wisdom of the ‘wise old heads’ along with the enthusiasm of the young people. A good plan has everyone in a role and doesn’t cast someone out to retirement.”

Mrs Knight admits anyone going into the planning process needs to be prepared and committed.

“When we start working with people, we start with the business owners. They provide us with various information and fill out an extensive questionnaire. We meet them face to face and ask them how they see their future, the business’s future, and the family’s future.

“They need to be very willing and able to make decisions. If they’re going to bring in their younger generation and not change anything then that’s not going to be a good situation.

“Psychologically, they have to be prepared to change their roles in the business as the next generation comes in. Financially, the farm business also needs preparation to ensure there’s room for more people on the balance sheet.”

The benefits of having an effective succession plan are two-fold. Not only does a plan help ensure a harmonious and functional working and family relationship, it can also improve business performance.

Mrs Knight says she’s seen an increase of up to 25 percent in business performance brought about by renewed enthusiasm and an increased use in technology by the younger generation.

“When decisions are made earlier and on the front foot, it means decision makers are ahead of the game. It gives them the edge.”

Isobel Knight is a finalist in the NSW Rural Industries Research and Development Corporation Rural Women’s Award. The winner will be announced in Sydney on March 26.

About nswrwn

NSW Rural Women’s Network is a government program working in innovative ways to promote leadership and action on rural women’s issues. The RWN team is dedicated to connecting and exchanging information with women and stakeholders in rural, regional and remote communities.
This entry was posted in agriculture, business, Families, farming, leadership, NSW Rural Women's Network, RIRDC rural women's award, Rural Australia, rural women, women and tagged , , , . Bookmark the permalink.

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