![[Review] ‘Family-owned companies should take a more strategic approach to succession’ | NPM Capital](https://www.npm-capital.com/hs-fs/hubfs/Imported_Blog_Media/16-11-24%20Opvolging%20familiebedrijven_0_jpg.webp?width=2000&height=2000&name=16-11-24%20Opvolging%20familiebedrijven_0_jpg.webp)
Henk Kwakkel is an entrepreneur, supervisory director and lecturer at the HU University of Applied Sciences Utrecht. He recently published a new book that aims to equip ‘family-owned companies and accountants, tax consultants and other advisers to ask relevant questions needed to determine and take control of the succession strategy,’ says the author. In his book entitled Familiebedrijven en opvolging (Family-Owned Companies and Succession), Kwakkel presents a new theoretical model called the SAS model (Strategic Analysis to Succession).
The book is based on research into the problems and possibilities of succession within Dutch family-owned companies. Kwakkel interviewed a number of owners of medium-sized family-owned companies for this purpose. The case studies presented in the book have also been derived from these interviews. He furthermore asked 500 owners of family-owned companies to complete an extensive questionnaire.
One of the main findings of this research is that family-owned companies do not approach succession strategically enough. In many cases there is not a detailed plan or scenario and there is a real fear of what Kwakkel calls ‘alternative succession scenarios’, such as a private equity firm, a management buy-out or a management buy-in. Nearly one-third of the survey respondents said they would prefer to have a family member as successor – even if no such family candidate is available.
Non-family members
Another key finding is that having a Supervisory Board or Accreditation Council comprised of non-family members generally has a positive effect on family harmony – before, during and after the company transfer. They provide much-needed objectivity, which helps ensure family relations do not become strained.
Kwakkel wanted to above all write a practical book. That’s why he developed a model that is designed to provide concrete tools to make sure a succession runs smoothly. The author says the objective of this SAS model (Strategic Analysis to Succession) is ‘to bring the emotional and business sides into balance.’
The SAS model provides insight into what is or could be at play within the four key pillars that underpin every succession: business governance, family governance, internal interaction and external interaction. The author devotes a separate chapter to each of these aspects. He then discusses them in correlation with each other. Kwakkel does not, however, fall into the pitfall of providing a blueprint: he says each family company is unique and as a result an infinite number of scenarios for company succession are in principle possible. The model serves more as a ‘decision-making wheel’ around which the author makes the key themes that come into play with respect to a succession discussible.
The basics
The book is clearly intended for family-owned companies themselves: anyone who has some specialised knowledge of the issues relating to family-owned companies will not gain any in-depth insights from it. It is nonetheless a book that every member of the board of a family-owned company could enjoy reading on a rainy Sunday afternoon, if for no other reason than that his book ends with the chapter entitled ‘Forty good questions concerning company succession’. And asking good questions beforehand is always useful – not only when there is a planned company succession.
Want to read more about the strength of family-owned companies? Also read Marketing en het Familiebedrijf (Marketing and the Family Company) by Dr R.A. Flören et al. NPM Capital sponsors the Baker Tilly Berk Chair of Family Business and Business Transfer at Nyenrode Business University.
