Phase Four: Transition to the next generation

Each generation must eventually make a decision regarding the future of the business.  The first generation may have sons and daughters or nieces and nephews eager to take the helm. As the business transitions across multiple generations, however, there may be less interest in actively participating in daily operations. While the founder’s passion may no longer be the governing force for change and growth, the family's passion may grow even stronger as the succeeding generations develop their own sense of pride in the sustainability of their name and their legacy.
Some of the common areas of interest in the transition phase deal with the future sustainability of the business itself. They range from decisions regarding whether to sell or expand into emerging markets, creating a foundation to carry out the philanthropic pursuits of the family, opening a Family Office, and governance structuring that allows the family to maintain control without being present. 
Other areas of importance before and during a transition include funding the prior generation’s retirement plan. If they cannot afford to retire, they won’t!  Proper estate planning, including payment of any possible estate tax or the funding of any accelerated buy-out either due to death or disability, will help to ensure a smooth and seamless change over.