David:

[0:00] If you have a God-honored business that is being used to minister to others, good for you. The question of the day becomes, what would your business be like when you were gone? And if you spent years building a business that honors God, why would you leave the future to chance? The solution is succession planning. And so when you work and plan towards replacing yourself while you're still able to lead, you can better ensure your business will continue with the same values that you have previously instilled into it. Today, I brought on expert Harry Jones to talk about succession planning and what you can do in your business to continue, basically so your business can continue serving God faithfully years after you're gone. Harry, welcome to Redeeming Business today. And to get started, what is one way, you've talked to a lot of business owners and people, what is one way that you have found that people have honored God in their business?

Harry:

[1:00] Well, I'm living a life of second and third chances, David. And I've had two 20-year careers with great companies, leading great companies, had good teams. But it took me most of that time to realize that the business belongs to the Lord. It's there for a reason much more impactful than just making money. I went to Central Asia a few years ago on a business's mission trip.

Harry:

[1:33] And I saw there in the 14 days we were there. We were in three countries that end in STAN. And we visited numerous businesses and met with many entrepreneurs. And I was so inspired. I came back and talked to my pastor and said, Tim, I have squandered 41 years of being in business by failing to live my faith. And here were people that were living there, demonstrating their faith through the way they worked with excellence, through the way they loved people, the way they cared for their employees or cared for their customers, they cared for their vendors. And when I told my pastor I've thrown away 41 years, he said, wait, before you beat yourself up, what are you doing in your business to glorify God right now? and go double down. So that is an answer to your question about the impact.

Harry:

[2:39] What is the impact that makes your business worth continuing another generation? And that drives our work today.

Harry:

[2:50] It was very clear in that same lunch conversation that what our business was doing to glorify God, We were hiring people out of jail, out of drug rehab. My business partner of 21 years, Randy Harvey, grew up tough, and he would hire people that everybody else had given up on.

David:

[3:15] Okay.

Harry:

[3:17] And sometimes it works. He would, like, put them in, think about it, in the boxing ring. He'd wipe off their face and stitch up their eye and put them back in the ring, sometimes they would stay with us, but we always tried. And we got some great employees out of it, and it goes deeper than that. We recognize that gave us a reason to get up and go in the morning. That gave us a reason to grow our business so we could employ more people who others had given up on.

David:

[3:56] Okay, very neat. I know one of my earlier guests I've had on the show, basically after God's been working on his business so long, he's like, yeah, it's a great ministry. We bring people in, fix up their souls, and then send them on their way. And just many people have come in, got saved. And yeah, some people stay, but they always leave better than when they came spiritually. So that's neat. So yeah, I like your comment that you said, what makes your business worth continuing going? What are you doing with that?

David:

[4:29] So what is succession planning? I mean, it should be obvious what it is, but define it for us.

Harry:

[4:36] Well, we call it succession planning for impact. Okay, for impact. It's so that you can continue the impact that makes your business valuable. And we've developed a seven-step process. And we actually developed this in through working uh with a company within its third generation and and i've written about i write a story every week and we've written a book that's filled with stories all all the stories are true but we changed the names to protect the innocent and the guilty but we'll call it gill is the character in the book and gill and i sat down in his war room. Actually, we stood up all day, a whole day in his war room at the marker board all the way down the wall. And we've worked out the process for people to use, and it's seven steps. Would you like me to go through those steps? Would that be helpful?

David:

[5:38] Sure. Just give us a couple of them, and we'll talk about it.

Harry:

[5:42] The first one is confront your fears about succession planning. In my own experience, we built a great business. I was there for 20 years. In the eyes of the world, it was glorious when we sold out to a public company. I had a one-year consulting agreement. We had a wonderful team who stayed to run the business. And I crashed. Nobody knew it. I hid it well. But I went into a funk because the only identity that I had in life was CEO of a great business.

David:

[6:21] Hmm. Okay.

Harry:

[6:23] So that's step one. Step one is confront your fears about succession planning. There are three different categories. One of those categories is fear of loss of identity. I experienced it.

David:

[6:38] Okay. So people might fear succession planning because they don't know what they're going to do after if they hand their business off is what you're saying.

Harry:

[6:45] Yeah. Fear of loss of identity is one category. Another category is too many unanswered questions. What am I going to do in my life? What are people going to think? Uh, and, and financially, am I going to have enough money? Where will I live? So fear of loss of identity, too many unanswered questions and fear that someone else is going to do a better job than you.

David:

[7:11] Why would, why would that be afraid? Why would that be a fear for people to see somebody else do better than you?

Harry:

[7:18] Well, you'd think they would be celebrating. Uh, if you get into our process, uh, the, the step six is passing the baton. And there's a lot of preparation work that goes into that, but the process of passing the baton is you won't have the fastest runners. You want to hand off in, in the box, in the runner's box.

David:

[7:42] Yeah.

Harry:

[7:43] You want to hand off at maximum speed. Don't wait. Don't let the company slow down. It's okay for you to slow down, but keep your company going at maximum speed. And when you hand off, stay in your lane and cheer them on. You're exactly right, but it is, I deal with it every week. People who are afraid because they don't have anything else to do. They don't have another identity.

David:

[8:09] So what do you do to help them have an identity outside of their work? What are some tips you can give to these people?

Harry:

[8:17] Well, there's several things, several things. And we've written a book. We have a book that outlines the seven steps. At the end of each chapter on the seven steps are questions to stimulate conversations. David, it all begins with conversations. But often founders and CEOs don't want to have the conversation. And I'd be glad. I've got a recent story that happened, too. I was with a heavy equipment operator doing some work this guy has three crews of heavy equipment he's 40 his father's 70 he was in the truck with me.

Harry:

[9:00] And, uh, I said, well, what is y'all's plan for succession? And he was steaming. He said, I run the business. Dad owns the business and I can't get him to talk about it. So it all starts with conversations. We have questions to help you. So some of the tools you can buy the book is available on Amazon. You get an audible, you get it on Kindle, just do it yourself and go through that process. Maybe some of those questions will help you stimulate the conversation. I write a weekly story. And we have a private email list you can subscribe to. And any of your listeners, David, if they want to talk about a specific issue, you can go to my website, cultivatingimpact.biz. Maybe you have it in the show notes as a contact form. you reach out you tell me you're a friend of of of david smith's and i'll be glad to arrange a call and and be your first call will be free okay.

David:

[10:04] What is the name of your book

Harry:

[10:06] Uh succession planning for impact okay.

David:

[10:11] That's the name of your book okay you said that already yeah

Harry:

[10:13] Seven steps to build a significant life.

David:

[10:17] Okay.

Harry:

[10:18] And a company that will outlast you.

David:

[10:21] Sure. Yep. So do you have any story, a short story of somebody who, where succession planning has gone well?

Harry:

[10:29] Sure. Uh, in, in two of our groups, uh, we have, we have virtual groups that we run about, we have, uh, we accept about half the people who apply. These groups meet monthly. There are seven or eight founders or CEOs in each one. And between monthly sessions, they can have a one-on-one with me. What we've seen is three of the people, I'll call them graduated. In two of those instances, let me back up and say, here's the reason the groups work. Confidentiality nobody never nothing my wife does not even know who's in in the groups a confidentiality calendar you can be there the second tuesday of each month unless you're in hospital you're going to show up and be there and third you make the commitment that you're going to invest in those other members of the group more than you expect to receive yourself so through this, the answers typically lie within the person, within the founder or CEO, but the other members help them clear the fog so those answers can become clear. And so in two of the instances, there was already a person in the business that.

Harry:

[11:56] And each of them had a COO or general manager who was seasoned. It wasn't going to be around forever. But in the event that the founder or CEO could not function, they had somebody that knew enough about the business could carry on that just

Harry:

[12:13] had to be more intentional about training them and informing them to keep them up to date. So we call it the bus plan. So what if you get hit by the bus? There was somebody already there and then in both cases they had a younger person who it would take three to five years to train and that is just so exciting people have a breakthrough we call these breakthrough groups in the third instance i had worked with robert on his first, he had two businesses, on his first business, and he was able to run alongside, his son, who is his successor, and who was already working in the business. And we worked out an ownership transition. And Robert is still an employee of that company, although his son owns it today. But he had a second enterprise.

Harry:

[13:09] And that's the reason he joined the group, because he could not sort it out. But the group helped him to realize some of the obstacles that the general manager had, the reasons she did not want to buy the business. They worked through those obstacles, and Robert was able to transition that business to her. She's carrying it on. It's a very impactful business today. That's some of the success stories.

David:

[13:35] Okay. That's very cool. Yeah. Finding people to train to replace you when you're gone. If you have not started any of that, what is the general timeframe that it takes to make that transition from, I don't have anybody take over to, I need to find somebody to take over?

Harry:

[13:56] Well, we use the old adage that the best time to plant a tree is 20 years ago, but the second best time is today. So you just start from where you are. I'd use the rule of thumb of 10 years and bring your people in. The steps of our plan work. I mentioned confront your fears. The second is establish a succession planning team. Well, our virtual group functions as a succession planning team, but you can also do it on your own, two or three people. Our book describes how to do it. The third is defining your impact. You must define the impact of the business that makes it worth continuing. The fourth step is defining your niche. The fifth step is developing leaders on your team from which to choose your successor. And it often takes two people to replace a founder. Step six, as I mentioned, is passing the baton.

Harry:

[15:01] Step seven, and if there's only one thing that your readers get out of this, your listeners get out of this, one question for them to ponder. What does it mean for you to finish well? Step seven is finish well.

David:

[15:21] Is that an individual question to finish well that each person has to decide for themselves?

Harry:

[15:27] Yes.

David:

[15:29] Okay.

Harry:

[15:30] And we all get it.

David:

[15:31] That is something to think about. Like what you said, why should my business continue? What am I supposed to do to finish well?

David:

[15:39] Very good. What are some common mistakes that you see people have made with their business? In transitioning or not transitioning?

Harry:

[15:49] They're stuck.

David:

[15:52] Stuck. How are they stuck?

Harry:

[15:54] Sometimes good or good enough is an obstacle to great. People get comfortable in the success of their business. I've got a guy, Henry, that I've written about. For four years we've been connecting and he's been talking about he's going to do something with his business well henry it's a hundred million dollar business henry runs it all and he's 77 years old wow so being stuck is a really difficult thing you your parents probably not old enough for you to deal with this, but with both of my parents, I had to deal with their driving. With my father.

Harry:

[16:50] I had to take the keys away from it. I actually had to get his doctor to take the keys away. So it's the same thing with running a business. You can make a choice. Do you want to have someone take the keys from you? Or you want to build it and hand those keys over? And finish well means flourishing. Our ideal clients are people who realize they have an impact in their business that's worth continuing. And they desire to flourish. They don't want to hang up their saddle. They want to keep going and using those gifts and talents and experiences and relationships, either in the business or developing a new platform. So that's our ideal client.

David:

[17:36] Okay. I think you said earlier you had an example of a man who basically handed off his business to his son. Son is running the business, and he's still employed doing things in the business. To me, that seems like an ideal way because you can still have an impact and still do the things that you love in the business, but then somebody else is running it and all that weight and responsibility is not on you. That's very good.

Harry:

[18:02] I'm writing a story about him right now. The series that we're in right now is breakthroughs, seven breakthroughs in our process. And I'll give you a teaser. This will come out in June.

Harry:

[18:15] The title is having your cake and eating it too.

David:

[18:19] Okay very good so what are some tips or advice you can give to people who are not quite there ready to pass it on yet but maybe you gave a 10-year window that maybe we should within 10 years i might want to retire or slow down or something, what are some tips to help them down that road?

Harry:

[18:43] Well, maybe start with step seven, the question, what does it mean to you to finish well?

David:

[18:50] Okay.

Harry:

[18:51] And a process that I used, it was very beneficial to me. I went on two weeks of article with my wife. We prayed a lot we were together we were separate, and i had a calling to leave my second business where i thought i'd be the rest of my life and part of the process that i went through in the following weeks, is i wrote my obituary i've.

David:

[19:25] Heard of that

Harry:

[19:25] It's just a paragraph, And what I wanted on my tombstone, or if you want to be a little more positive, if a book is written about your life, what do you want the title to be?

David:

[19:40] Sure.

Harry:

[19:41] My epitaph is Entrepreneurs Bearing Fruit. And when you have those roughed out, and you have prayed through them, and you have talked to your spouse, you know, your spouse ought to know you better than anybody else on earth. Then what is your preferred picture 10 years ahead where do you want to live what do you want to be doing how do you want to spend your time how will you be your spouse be if you have them how will your children and grandchildren be what are your financial needs in 10 years, and when you have that sorted out what's halfway there five years from now what i want to be doing, and when you have that sorted out that's four steps obituary book title 10-year preferred picture of the future five-year preferred picture of the future and the fifth step what must i do in the next 12 months to move in that direction the 10-year, preferred picture is not going to turn out that way but it gives you a sense of direction of how you will spend your life and you can then start planning the transition of your business. It often takes two people to replace a founder. You're going to have to invest in some talent and build them up. To carry on. But that gives you a timeframe if that's helpful.

David:

[21:09] Yeah, no, that is helpful. That's interesting that you say two people it takes to replace you. I'm not sure why that is, but I've also, it's interesting because I've heard people talk about your goals, about the goals of the growth of your business and all this stuff. I haven't heard that in light of my goal in transitioning out or succession when I'm going to hand the business off. But yeah, it's still the same, still the same really good planning. So how can my audits find out more about you if they want to get into one of your groups?

Harry:

[21:42] We have a contact form on our website, or if you can shoot me an email, you connect with me on LinkedIn, I'd be glad to respond to you and share with you. Again, the groups work because we are very selective in who joins and we're so excited we had our first ceo designate join a group uh in january and the following month the baton was handed to him so it's been quite a ride i.

David:

[22:17] Bet very neat

Harry:

[22:18] But our our participants are from around the world we have four time zones in each of the represented in two of the groups. So that's exciting.

David:

[22:29] Very good. Well, we'll take that and we'll put that links in the show notes if you guys want to find out more about that. Said a lot of good things today. What is one challenge you'd like to leave for our listeners today as we pack up?

Harry:

[22:44] This is a litmus test question if you want to define the impact of your business. By the way, about half of our contact comes from people who are in the next generation. Because often the senior generation don't want to talk about these things. Start the conversation. Here's a way to start the conversation. Step three is define the impact of your business.

Harry:

[23:12] Ask the question. So if we shut down our business in 90 days, why would that be bad? Who would care? What difference would it make? If we shut our business down in 90 days, what are the consequences for our employees, for our customers, for our vendors, for our community? Businesses have such positive impacts in the communities that they serve. They're often the places where leaders are built to influence in positive ways their whole community. So check it out and just ponder what would happen if we shut this business in. That may reveal to some of you the impact that makes your business worth continuing.

David:

[24:03] That's a good way of looking at it and trying to figure out what impact you do have when you take yourself away. Yeah, very good. Well, Harry, thank you very much so much for your time and encouragement today. And next steps for you in the audience, check out the show notes for links and sites and contact information for how to get into one of Harry's groups or find out more about the succession planning. And go ahead and subscribe to the show and sign up for the newsletter because it's a great way to continue to redeem your business and not be conformed to this world. So that's friends. That's all for now. Trust you've been inspired to redeem your business, redeem your time, buy it back, and walk worthy of God's great name. Thank you. Bye for now.