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Build your Business Legacy through Succession Planning

Advice on building your succession planning with your family.

Standard Bank




Sooner or later, most entrepreneurs must consider the future sustainability of the enterprises they have built. Eventually the business will have to be handed over to someone with the skills needed to usher the company into a new era.

Ensuring that this happens in a planned and effective manner requires the development of a realistic succession plan that anticipates the realities facing the business owner.

Diale Mokgojwa, Senior Manager, Enterprise Development at Standard Bank says the type of succession plan depends on the owner’s circumstances. However, in South Africa, the succession issues that most often have to be addressed in smaller businesses are whether a family member will take over, or if an ‘outsider’ is a more practical choice.

Likewise, attention needs to be paid to the options of selling a portion of the business and including loyal employees in the equation. Finally, the potential of structuring the succession plan to cater for Black Economic Empowerment (BEE) interests also has to be put on the table.

“These options can have far-reaching consequences on the business and thus require that the owner makes the decisions as unemotionally and practically as possible.”

Unfortunately, when it comes to family-owned businesses, ideals and reality do not always intersect where they should, says Mokgojwa.

 “It is not uncommon for someone who has spent his life building a business to have misgivings regarding the next generation’s commercial capability.”

The trouble with keeping it in the family

Typically, issues that can complicate keeping a business in the family include:

  • Family disputes. These vary, but often centre on disagreements involving the present owner’s successor.
  • Complications arise when the present owner disagrees with the direction in which the new generation wants to take the business.
  • Inheritance issues. If the business can only support a few members of the owner’s immediate family, the others may feel aggrieved and expect compensation through a passive shareholding scheme.

“It takes courage and conviction to address these matters openly,” says Mokgojwa.  “However, it must be done and all issues must be resolved to avoid future conflict and to focus on the skills needed for the company’s survival.”

The succession plan

If a succession plan demands strategies to be put in place that do not include the family, several other alternatives remain to be considered, says Mokgojwa. These include:

  • Identifying a potential partner or partners to invest in the business. This will enable the owner to ensure that the skills required to develop the business are brought onboard, and sustainability is ensured as the people concerned will have a stake in the business.
  • Considering a BEE partner who has the skills and who will also increase the future viability of the business by opening up markets in key sectors, particularly government.
  • Evaluating the skills and commitment of key staff members and offering them shares in the business with the promise that when the time comes for the owner to depart, they can use a management buyout to buy the majority, or all, of the owner’s shares.
  • Offering staff the buyout option, but stipulating that the process will be accomplished through their purchase of shares on an ongoing basis that could take several years to accomplish. This enables the owner to withdraw over a long period, or even retain a small equity holding in the business that can be used to generate annuity income, or be kept in a trust for family members.

“Although any of the above solutions will ensure that the business remains sustainable and well-managed into the future, it is wise to remember that relationships have to be firmly based if potential conflicts are to be avoided,” says Mokgojwa.

“Mutual compatibility is the most important requirement when selecting a successor; having a common background, shared value system and enthusiasm for business all make it possible for a trusting, mutually beneficial relationship to develop and grow, making sure the future of the business is in good hands.”

What to include in the plan

When preparing a succession plan, care should be taken to identify:

  • A person who shares your values, entrepreneurial temperament and vision.
  • Partners who bring specific skills and experience to the business.
  • Someone who can bring capital, a business network and connections to the business.
  • A person who has high personal standards and business ethics.
  • Someone who you respect on a professional level, as you will then value their inputs.

“Developing a succession plan is vital; the sooner a need for a plan is recognised and the sooner it is accomplished, the easier it will be to concentrate on developing the value of the business, as you can rest assured that the business will remain intact in the future,” concludes Mokgojwa.

Related: How to Build Skills, Loyalty and Profits With Staff Training

Standard Bank SA is the largest operating entity of Standard Bank Group, Africa’s largest bank by assets. Standard Bank SA provides the full spectrum of financial services, with more than 720 branches and over 7 100 ATMs. Independent surveys of customer satisfaction consistently place Standard Bank at or near the top of their rankings. The personal and business banking unit offers banking and other financial services to individuals and small-to-medium enterprises. For further information, go to

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Company Posts

Rethinking Learning In The 21st Century

The changing world of work has disrupted the three elements of the traditional ‘career’: Expertise, duration, and rewards.

Wits Plus




Vital Stats

Traditionally the concept of a ‘career’ was considered to include three elements:

  1. A career represented our expertise, our profession, and ultimately our identity.
  2. A career was something that built over time and endured. It gave us the opportunity to progress and advance.
  3. A career gave us financial and psychological rewards. It made life meaningful and paid us enough to live well.

The changing world of work has disrupted all three elements: Expertise, duration, and rewards.

A career can now be as long as 60 years; at the same time, due to rapid advancements in technology and the changes that bring about in the workplace, skill sets can become obsolete in as little as five years.

Increasingly, companies need to rethink the way in which careers are managed and learning opportunities are delivered, and many have already begun to overhaul their career models and L&D (Learning and Development) infrastructure in line with the digital age.

Related: Your Investment In Knowledge

Employees’ learning behaviour is also changing. In the past, employees were able to obtain the skills required for their career early on and as a once-off; now, the career itself is a journey of learning, up-skilling, re-skilling and continuous reinvention to remain relevant and to thrive in the changing world of work.

Older employees who studied at a time where most of one’s learning occurred prior to entering the workplace, find themselves working alongside millennials who place greater value on learning and progression rather than on earning potential as a first priority.

Eighty-three percent of the respondents surveyed in Deloitte’s 2017 Global Human Capital Trends survey say their organisations are shifting to flexible, open career models that offer enriching assignments, projects, and experiences rather than a static career progression.

However, in today’s fast-paced business world, even if companies are restructuring L&D delivery, no one is going to make you engage in a strategy that is essential to your future success – continuous learning. You will have to take the initiative yourself.

Noted self-help expert W. Clement Stone, in his many writings on this topic, recommended that one spends anywhere from a half-hour to two hours a day in study and thinking time. This tireless dedication, combined with an insatiable curiosity, will equip you to excel in the future world of work. What’s more, learning new skills and knowledge can be fun!

The good news for both companies and for employees is that an explosion of high-quality content and digital delivery models offers employees ready access to continuous learning. The Wits DigitalCampus offers a range of accredited and fully online short courses to support your continuous learning.

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Company Posts

Your Investment In Knowledge

When you understand the value of knowledge, in this world where technology is rendering previously expensive products or services much cheaper (and even free), it’s just a matter of getting more of it. Dedicate yourself to constant learning!

Wits Plus




Vital Stats

Most people spend their lives collecting, spending, and worrying about money — so much so, in fact, that they say they “don’t have time” to learn something new.

However, some of smartest and busiest people in the world — Barack Obama, Warren Buffet and Bill Gates — all spend at least one hour a day on deliberate learning. They see what others don’t: That learning is the single best investment of our time that we can make. As Benjamin Franklin said long ago, “An investment in knowledge pays the best interest.”

When you understand the value of knowledge, in this world where technology is rendering previously expensive products or services much cheaper (and even free), it’s just a matter of getting more of it. Dedicate yourself to constant learning!

One of the very benefits of ongoing technological advances is that it empowers an accelerated and personalised learning experience that puts the learner in the driver’s seat. Modern learning harnesses the speed, power and ubiquity of digital capability. Online platforms, software and mobile devices means that the traditional hurdles to learning — such as income, status and location — have just about disappeared. Knowledge can now be gained by anyone with the passion to pursue it and the commitment to stick with it.

Related: Building Customer Relationships

We are only at the tipping point of what future learning technology can deliver. Artificial intelligence (AI) will transform all aspects of human capital management, including learning. Technology-enabled learning will be immediate and directly relevant to the task, for example:

  • personally tailored learning content and experiences delivered to you as and when you want or need them
  • chatbots and virtual assistants can source and categorise the information that you need for optimal decision-making
  • augmented and virtual reality simulations can provide a multi-sensory experience to speed up and embed learning.

Additionally, social connectivity already enables user-generated content to outpace and outstrip what traditional education and learning institutions can deliver.

Knowledge may be the new money but, unlike money, you don’t lose it when you use knowledge or give it away. Transferring knowledge anywhere in the world is free and instant. It’s fun to acquire and it makes your brain work better. It helps you think bigger and beyond your circumstances. It puts your life in perspective by essentially helping you live many lives in one life through other people’s experiences and wisdom.

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Company Posts

Are You Struggling To Find Financing For Your SME? Try Alternative Finance

If you don’t qualify for traditional funding or if it isn’t the right fit for your SME why not explore alternative funding? We specialise in alternative financing options by providing in-depth and custom plans for you and your business needs.






Vital stats

Alternative Finance is finance beyond the traditional – it is defined by the financiers’ area of specialisation – by what they specialise in, whom they serve, and how they provide their funding. It does not replace traditional finance but rather functions as a complementary and additional form of funding.

Alternative financiers are specialists – they focus on a particular need and on a specific audience. As a result their ‘how’ is customised to deal with their chosen target market and for this targets unique needs. This applies to the funder’s processes and to their level of flexibility around things such as collateral.

An example of this is that a SME may have an existing R1 million overdraft (their traditional finance) secured by R 1.5 million collateral but suddenly they need R5 million for some kind of contract or bridging finance – they need it fast and don’t have that extent of collateral.

The traditional funder cannot provide what they need, their process is too long and their flexibility is too low. An alternative financier providing bridging finance and specialising in SMEs is ideally positioned to fill this gap.

One of the most significant differences between a traditional funder and an alternative financier is in their process. In the case of the alternative financier, they have often chosen to deal exclusively with a particular customer base, for example SMEs. As a result, this funder has both an affinity and contextually relevant empathy in working with SMEs.

Not only do they speak the same language the funder also has an appreciation for the time and material constraints of the SME and has developed their processes to cater to this market. This applies most notably to the turnaround time of the funding need and to the assessment aspect – where flexibility around things such as collateral is vital in making the finance happen for the SME.

A traditional funder is unable to meet the deadline of a bridging finance need, submitted on an urgent basis, where the finance is needed as soon as 2-3 days from time of application. A specialised or alternative funder is able to do exactly this. A traditional funder is also unable to find creative methods in solving the SMEs lack of high-value collateral in applying for finance.

This SME has generally already used their high-value collateral for traditional credit facilities but now needs funding for growth or resolution of a temporary cash flow challenge. An alternative financier is able to look at such an application in a different way, and has most likely already established alternative ways to make this happen for the SME.

Related: 5 Key Questions To Answer For Raising Funding

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