Creating Ownership Independence: Part 2
Written by the Blue Trust Business Consulting Division
Part 2: Identity
Part one of our ownership independence discussion focused on the benefits to the owner and to the business of separating personal and business finances. Part two focuses on establishing separate identities for the business and the owner.
Ecclesiastes demonstrates the importance of motivation when building identity. We worked with one client who was determined that his children, and only his children, would take over the family business. Building a business identity for the glory of one’s personal family can indicate pride, as shown in Ecclesiastes 2:4, “I undertook great projects: I built houses for myself and planted vineyards.” Building a business identity for the glory of God’s family allows the business to have a Kingdom impact. It also frees the owner to look beyond his or her own interests when making both personal and business decisions.
It is understandable that a founder would be deeply invested in the health of the company. In our work with business owners across the country, we have observed that if the founder or current leader is preparing a company for an ownership change but is not prepared to make a graceful transition, the rest of the process will not proceed effectively (if at all).
Conversely, we’ve seen very effective transitions when owners have a clear sense of personal direction for the future and are prepared to redefine their role in the business.
A clear sense of personal direction
Many family business owners have devoted such a disproportionate amount of time and energy to the business that they have few (if any) interests outside the business.
Developing a personal vision and growth plan will help move your interests and activities beyond the boundaries of the business, helping to facilitate a smoother transition for the business. At the same time, your personal vision and growth plan should leave room for continued and appropriate involvement in the business because you still have a tremendous amount of knowledge to convey.
Redefining your role in the business
Consider how your role in the business will evolve. You might act as a teacher, where you actively and purposefully transfer vital knowledge to your successors. As a mentor, you can serve as a guide and sounding board as your successors apply their skills and knowledge. And as a door opener, you can transfer key contacts and relationships to provide better continuity in your organization.
Creating ownership independence with regard to identity provides freedom for both the business and the owner.
Application
Here are some questions to consider as you reflect on how this information applies to your business:
- How do you avoid finding your identity in the business?
- What areas in your life are you excited about outside of your business?
Next Steps
We recommend this next step to begin developing ownership independence as it relates to identity:
- Identify outside interests
Understanding ownership independence and evaluating your business and role are the first steps. Developing and implementing an actionable plan that pursues this objective and brings the benefits follows.
Would you like personalized guidance as you think through creating ownership independence? Blue Trust’s Business Consulting division leverages biblical wisdom and practical expertise to advise business owners as they seek to faithfully steward the companies with which they have been entrusted. To learn more, click here to visit the Business Consulting division page on bluetrust.com.
Scripture taken from The Holy Bible, NEW INTERNATIONAL VERSION®, NIV® Copyright © 1973, 1978, 1984, 2011 by Biblica, Inc.® Used by permission. All rights reserved worldwide.
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