“Peter … you’ve change into a pirate.”
I take into consideration this scene from the 1991 film Hook method greater than I ought to. It’s when aged Wendy meets a grown-up Peter Pan, who’s suited up and really happy with his essential work. Peter had change into, by all definitions, a company plunderer. And Wendy is naming a fact he can’t see about himself.
Wendy’s assertion captures one thing essential about management: what we do ultimately tells the reality about what we worth, whether or not we intend it to or not. Which brings me to my (maybe unpopular) perception:
A agency’s succession plan says extra about its values than any mission assertion, marketing strategy, or award ever may.
Values may be straightforward to put in writing. Succession plans are sometimes tougher to pretend.
As leaders, we will say we’re people-first. That we’re long-term oriented. Or that we care about stewardship and tradition, sustainable enterprise practices, and significant change, not simply earnings.
However ultimately, each chief has to reply one essential query: Who ought to profit from what I’ve constructed once I’m now not in cost?
That reply, quietly embedded in contracts and deal phrases, is your actual values assertion.
The Attract of a Massive Exit
I had my very own Peter Pan second.
Because the CEO of Abacus Wealth Companions, a California-based B Corp, I had a duty to discover all choices on the desk. When the chance got here to study promoting a minority stake in Abacus, I took the conferences.
Consultants promised massive numbers — numbers that might let me absolutely retire on the age of 39. The pitch was polished. The projections have been compelling.
So, I began asking questions.
I requested in regards to the upside and draw back. I dug into who truly benefited from these offers. And the extra I probed, the extra the reply turned uncomfortably clear: the individuals who received have been the most important homeowners on their method out.
I saved pondering: Who’s left holding the bag in spite of everything these offers undergo? How does this serve our purchasers? And simply as essential, how does this serve our crew?
We at Abacus have spent 20 years constructing an organization that fashions the kind of world we’d wish to stay in, one which demonstrates it’s attainable to prosper financially whereas additionally dwelling a extra fulfilling and purposeful life. If we bought a stake in our firm, we couldn’t assure new homeowners would uphold those self same values.
May I truthfully sit throughout from the folks I’d spent all these years constructing belief with, those that I fought to guard throughout onerous occasions, and inform them this was higher for them? Higher for our purchasers? Higher for the enterprise we’d constructed collectively?
I felt it within the pit of my abdomen. We’d spent years at Abacus doubling down on our B Corp roots, on being purpose-driven, on constructing one thing that mattered past revenue.
That’s when Wendy’s line hit me. Accepting a deal like that might flip me right into a pirate.
Why Non-public Fairness Usually Indicators a Succession Planning Failure
Whether or not your organization is in monetary companies, manufacturing, retail, or one thing else, you’re seemingly additionally grappling with the thought of what’s subsequent. Excited about who will step as much as lead whenever you’re gone. Or questioning who will carry the torch and stay devoted to the identical values which have led your organization to the place it’s at the moment.
For purpose-driven companies, your exit plan issues much more. And in case your exit plan entails promoting to personal fairness, that’s a succession planning failure.
I don’t say that to be provocative. Non-public fairness could be very clear about what it optimizes for: time-bound returns, leverage, and exit. That’s not hidden. It is the mannequin.
However on the planet of purpose-driven fashions, the personal fairness mannequin is the final word pirate ship. It pulls into your harbor to not spend money on the area people or preserve the lighthouse, however to load the gold onto the deck and sail away with it. Possibly not instantly, however within the subsequent 5 to seven years.
When a agency that claims to worth folks above all else palms management to capital whose job is to extract worth on a set timeline, actions begin talking louder than phrases. Succession planning forces a alternative most of us would fairly blur: Is that this agency one thing to be stewarded or one thing to be monetized?
The Tough however Rewarding Path of Inside Succession
Inside succession may be tougher. Worker possession may be messier.
It doesn’t occur in a single day. It takes affected person, considerate schooling and inner communication. It may possibly take a decade to do proper. You’re working with folks and feelings and cash, and all of that will get difficult. Folks must choose in, however in addition they want to know what they’re opting into, and extra importantly, what occurs in the event that they don’t.
You don’t get one massive verify. You don’t get a clear exit. The blueprint isn’t easy or clear.
As soon as once more, you’re pressured to reply uncomfortable questions. Do I truly belief the individuals who helped construct this place? Am I keen to earn sufficient as a substitute of maximizing? And do I consider in my agency’s values past my very own tenure?
However the upside is so, so candy.
You get one thing much less flashy and much more revealing: alignment between what you say and what you do.
The founding era of leaders at Abacus trusted me and the following era with a imaginative and prescient of stewardship and shared prosperity. We crafted a succession plan by investing in folks, not simply extracting worth.
That’s what it appears to be like like to decide on stewardship over plunder.
It’s Time to Take a Look within the Mirror
An organization’s succession plan is its values in motion.
So, earlier than you polish your subsequent mission assertion or redraft your core values, take a tough take a look at your succession plan.
Does it match who you say you’re?
Or are you changing into a pirate?
Hook’s Peter Pan could have quickly misplaced his method, however in the long run he rediscovered who he actually was. And whereas he had sought massive journey, he lastly realized that “to stay … to stay can be an awfully massive journey.”
