JJ O’Connell’s Key to Success: Preparation, Planning, and Implementation in Family Business Succession
In the course of their field research, Meath County Council had the pleasure of speaking with JJ O’Connell, the director of the Plato Ireland Business Network and Family Business Ireland, Plato is a European wide business-to-business support and development network for owner-managers and one of Ireland’s premier IFC’s (Institute for Collaboration).
JJ has acquired extensive experience in the process of transferring and acquiring businesses throughout his career. A large percentage of Ireland’s SMEs are family owned or family run. Through facilitating the development of so many SMEs, Plato has had the great fortune of building up a unique knowledge and expertise within the network which has enabled hundreds of families to successfully transition from one generation of ownership to the next. The skillset and experience built up within the network over 25 years ensures that the network is Ireland’s premier team of trusted family business advisors. This is in large part due to the leadership, development, understanding and JJ’s steadfast commitment to the work as well as his continuous motivation to ensure family business owners get the support and advice they require.
As a family business and collaborative network specialist he relies on his personal skillset and understanding of the Family Business Succession process, as well as the legal and financial imperatives required to successfully transition; Tactical Business Planning; Facilitation; Strategy; and General Business Management.
JJ has decades of experience designing and implementing solutions, so he’s no stranger to the challenges associated with this subject. In his daily work, he encounters the following three challenges – Preparation, Planning and Implementation.
- Preparation: This stage revolves around the founder’s willingness and/or unwillingness to engage with the matter. There are many reasons that influence this and understanding why is key to any solution.
- Planning: JJ observes an absence of planning, know-how and where to begin a succession process.
- Implementation: There is an absence of input from Professional advisors as they do not provide adequate guidance to clients. Companies and individuals are often poorly served by their advisors. Accountants and solicitors should be proactive in challenging their clients into ensuring that properly thought through planning is in place. “There is no reason they [the clients] couldn’t be made aware of the financial, tax and personal issues [of transition – planned or unplanned] at minimum as part of the annual review.”
JJ is aware that succession processes are best supported by accounting and legal professionals’ knowledge and awareness. It is natural for clients to follow good advice if they are aware of its value and know that it will be beneficial to them and their family and employees. Information and data on the succession process should be easily accessible.
JJ believes that most businesses can be successfully transferred, however some of course come to a natural conclusion and it is good to plan for this too. JJ believes a successful transfer occurs when:
- The client has a clear succession plan – a well worked out and fully worked out plan.
- Planning is proactively undertaken by the client, they start early, and they rely on qualified external expertise to help.
- External advisors provide assistance with the planning and preparation, but the founder is ultimately responsible for implementation.
- Solicitors and accountants provide their clients with relevant advice, support and solutions for challenges if required.
A model JJ uses when helping clients to assess the best successor is ‘LODDICC’. Essentially this is a framework to assess the ‘natural’ entrepreneurial skills of the emerging generation.
- Leadership (capable and visionary)
- Opportunism (the innate ability to identify, prepare and exploit opportunities)
- Desire/Motivation (internal drive)
- Delegation (ability to work with others)
- Innovative (in finding solutions using existing resources)
- Creativity (particularly in problem solving)
- Communication (verbal but also through the quality of work and example)
In order for your successor to succeed you they require the skillset to be their own leader. You must look for a successful entrepreneurial leader who can identify opportunity, manage risk and most importantly rely on their internal motivation in facing challenging circumstances which is key to long term success.
In summary JJ’s key to a successful transition is solid planning, good preparation and focused implementation. Seek out good advice at the outset. Ensure planning is part of every conversation. Ensure you have a process you understand and agree with and most importantly find advisors you trust and have confidence in.