Today's Practice: Changing the Business of Medicine National Edition Q1 2018 | Page 57

Effective Business
Succession Planning
Edward J. Waldron In conjunction with Lincoln Financial Advisors
Business owners invest significant amounts of time and financial resources to make their
enterprises successful. Quite often, due to the quick pace of day-to-day operations,
planning for succession of ownership is relegated to a low-priority task. But there comes a
point in the lifecycle of any business when the owner is no longer able to manage the firm
that he or she founded.
Because the timing of death or disability is difficult to predict, it’s prudent to have a succes-
sion plan in place now to safeguard your family’s financial well being, and to provide your
business with leadership during a transition period.
One logical solution—and one that most entrepreneurs may want to choose—is to turn the
reins over to their children. However, despite its emotional and intuitive appeal, the odds
are stacked squarely against a business surviving a transfer down the bloodline.
According to the U.S. Small Business Administration, two-thirds of family-run enterprises
fail to make the successful transition to a second generation of ownership, and less than
15% survive into the third generation. Making a successful transition even trickier are issues
brought on by divorce, blended families, or rivalries among children.
TODAY’S PRA C T I C E: C HA NGI NG T HE BUS I NES S OF M EDI CINE
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