Like most business owners, I assume I have lots of time for business transition planning. I’m in my 50’s, am healthy, and have a good team around me. I haven’t discussed a back up plan with my spouse, and don’t have an estate plan for my business. I am not alone. And this is a problem.
As business owners age, without an estate plan for the business there is a lot of risk. What will become of the business, its clients, the employees, should something happen to me. Who makes the necessary decisions, what are the tax implications?
The Gap No One Plans For
We work with business owners who are planning for a transition in their business. Most often, to their employees. So that the owners can take a step back, retire or move on to other projects.
But transitions take time. Even when you have a plan for your transition, there are multiple steps: planning, design, legal structuring, and financing. Not to mention the cultural transition that needs to take place.
When Control Shifts
If there isn’t a clearly defined plan, ownership transfers to the estate, and the control and decision making for the business shifts with it.
The business could continue.. Employees continue working. Operations may carry on in the short term.
But direction becomes uncertain.
Whoever inherits the business—or is appointed to manage the estate—now has the authority to decide what happens next. They may not have been involved in the transition planning. They may not share the same priorities. They may not want the responsibility at all.
And they are not obligated to continue the transition path that was in progress.
Where Plans Break Down
This is where well-intended transitions can quietly fall apart.
An internal sale may stall.
An employee ownership transition may never be completed.
A different path may be chosen simply because it is faster, more known and easier to execute.
In some cases, the focus shifts to reducing risk or resolving the estate, rather than preserving the original plan.
The business continues—but not necessarily in the direction the owner intended.
Where This Actually Starts
This is often framed as an estate planning issue. In practice, it starts earlier than that.
Before structures are designed or documents are updated, there is a more fundamental question:
Who would be making decisions about your business if you were not there?
Why This Matters in Succession Planning
Succession planning is not just about choosing a path. It is about ensuring that path can actually be carried through.
Without clarity on who holds decision-making authority:
- transition timelines become more fragile
- intended successors may not be in a position to act
- and the outcome can change quickly under pressure
This is particularly relevant in employee ownership transitions, where structure and timing both matter.
Where This Fits in the Process
This is not something most owners are thinking about when they begin exploring a transition.
It is something we surface early.
As part of the initial design and exploration phase, we look at more than just structure. We look at what could impact the outcome—including who would be making decisions if the process is interrupted.
In many cases, this does not require immediate action. It does, however, change how owners think about timing, structure, and who needs to be involved.
The Real Risk
The risk is not that the business disappears overnight.
The risk is that control shifts to someone who was never meant to make those decisions.
If something were to happen tomorrow, would the right person be in a position to follow through on what you want?
