By Cynthia Adams Harrison, Managing Director — Center for Private Business Owners
Business succession planning can be difficult for many private business owners who might not have the time or in-house expertise to explore available options.
Last year, PKF O’Connor Davies hosted the first Private Business Owners Succession Academy to offer a comprehensive curriculum on succession planning. The program included interactive educational workshops, planning tools, implementation strategies and steps for creating action plans — all allowing participants to collaborate with our team and network with their peers.
If you missed our inaugural Succession Academy last year, we hope you’ll join us in 2025. In the meantime, below are the top six takeaways for your review now.
Top Six Takeaways
- Understand the Vital Role of Succession Planning: Kicking off the Academy, Steve Prostano, PKF O’Connor Davies Partner, emphasized the importance of succession planning to ensure the longevity and sustainability of a private business. Steve shared that the holistic, multidisciplinary team approach we take is designed to support both the business and personal needs of owners. Planning should be structured to help owners navigate the three possible succession paths: intra-family transitions, sales/transfers to employees or partners and outright business sales. It was noted that an owner’s emotional preparedness and willingness for open communication are also critical components of a successful succession plan.
- Assess Business Readiness: Academy speakers underscored the importance of a readiness assessment as a crucial first step in the succession journey — regardless of transition path. The experts recommended creating a roadmap to help prepare the business for a successful transition.
- Weigh Operational and Leadership Readiness: Strategic planning for operational readiness and leadership succession was discussed as crucial for business transitions. Speakers emphasized the importance of assessing business structure, streamlining operations and strengthening management teams to maximize value. It was also noted as critical for business owners to refine processes and eliminate inefficiencies to ensure smoother transitions, safeguard business legacy and address employee needs.
- Carefully Consider Legal Matters: The importance of legal strategies in business transitions was discussed, such as gifting or restricting ownership to family members or non-working stakeholders. The challenges posed by a growing number of stakeholders and potential gaps in business expertise were highlighted. Contracts, shareholder and operating agreements were noted as critical tools to document succession plans, obtain necessary consents and foster win-win solutions.
- Calculate Financial and Tax Implications: The speakers collectively highlighted the financial aspects of succession planning. The discussion included aligning personal financial needs with the business’s ability to support them, maximizing business value and addressing tax implications. Topics also reviewed were funding ownership transfers, partnership taxation and the need for customized strategies for each family-owned enterprise. Some unique considerations for S corporations were also discussed.
- Start Early: The overarching message of the academy was clear — begin succession planning early. Assessing organizational gaps, maintaining open communication and conveying an authentic vision will help ensure a smooth transition. Tailored strategies accounting for the financial, operational and emotional aspects are all critical to the success of any business succession plan.
More About Our Succession Academy
The PKF O’Connor Davies 2024 Inaugural Succession Academy was designed to create a learning environment for private business owners, featuring specialists who shared their valuable knowledge across the three possible succession paths highlighted above. Through presentations, discussions and interactive sessions, the specialists provided practical tools and resources to encourage private business owners to begin the process of their succession planning.
The second Private Business Owners Succession Academy is now being planned for the fall. Please stay tuned for further updates and registration details.
Contact Us
If you have any questions, please contact the PKF O’Connor Davies partner in charge of your account or:
Cynthia Adams Harrison, Ed. D., LICSW
Managing Director
Center for Private Business Owners
charrison@pkfod.com | 914.575.2744