Many business leaders find themselves asking: “Why can’t it be easier? Why is it so hard for us to make decisions together and get some of the simplest things done?”

Whether your company is a professional firm, family-owned business or manufacturer, people with different communication styles can get tied into knots working together. That in turn challenges productivity and everyone’s desire for a harmonious environment.

“I’ve discovered that metaphors are an easier way to explain why people are having challenges working together,” says Ricci M. Victorio, CSP, CPCC, ACC, managing partner at Mosaic Family Business. “The metaphor creates an instant picture. I like to say it’s the difference between the language of the tiger and the swan.”

Smart Business spoke with Victorio about helping individuals in a business form a cohesive team.

Why use the metaphor of tigers and swans?

You may have heard of ‘hunters and gathers’ when describing workplace dynamics. However, people may not want to be known simply as an implementer, and others might say, ‘I’m not a hunter, I love my people. I have passion.’ The tiger and swan metaphor is one where no one feels diminished.

Swans are beautiful, elegant creatures that live in harmonious flocks. They don’t like change, but if challenged, they become fierce. Tigers love the thrill of conquest, and the strategy of tracking their prey. That’s how they measure their self-worth, so there’s bravado from the adrenaline of a challenge.

Often in business teams there is miscommunication between the entrepreneurs who grow the business and those who make the business run. With the metaphor of the tiger and swan, they start to understand each other better. A swan learns that when tigers write emails in all capital letters, for example, they are not criticizing, but naturally talk big and directly. A tiger learns if he or she doesn’t listen to the warnings of a swan, things could fall apart.

What’s the first step to getting teams to work better together?

People with different personalities must learn to communicate in a more collaborative and professional way. It’s hard to work when you feel you’re walking on eggshells or waiting for the next fire drill. If you understand the language being spoken by various personalities, then you can adjust your delivery so you are understood.

To establish trust between the two, there has to be a genuine curiosity in learning about each other. You want to create positive experiences of working together, where everyone is being acknowledged for their collective and individual contributions.

If your team is struggling to understand each other, an objective coach who sees all the nuances of the personalities can help guide them when they step on each other’s toes, to reframe the interaction so everyone understands the intention of the other player’s actions. It takes someone who can see the big picture and isn’t part of the ecosystem to help bridge the gap.

How can business leaders ensure they have the right team dynamics?

Some important dynamics are called for to ensure a team works together best. The five characteristics of a team are:

  • Character. Who are these people? Do they have integrity and do you trust them?
  • Competence. Without skill, it won’t matter how much integrity someone has.
  • Commitment. A team fails or succeeds based on its commitment to one another.
  • Consistency. The team has to have the confidence they can count on each other, day-in and day-out.
  • Cohesion. Even when it’s difficult, the team needs to function at a higher level and know that together it’s better than any individual.

These elements are foundational for a successful team. If team members don’t trust each other enough to have transparent, authentic conversations when facing difficulties, their differences will create a wedge, pushing them farther apart. It’s not the job of any one person to make all the accommodations. Everyone needs to step into the center and take the time to learn the differing languages being spoken within the group. Once this begins to happen, you will begin to enjoy the benefits of a ‘bilingual’ organization.

Ricci M. Victorio, CSP, CPCC, ACC, is managing partner at Mosaic Family Business Center. Reach her at (415) 788-1952 or

Insights Wealth Management & Finance is brought to you by Mosaic Financial Partners Inc.

Published in Northern California

If you have three qualified job candidates with equal experience who interviewed well, how do you choose? Ask yourself how the new hire will fit in — will they enhance or disrupt your current team? The culture is critical anytime there is a personnel change, whether hiring, promoting or planning for succession.

“If you put a tiger in a group of lambs, what’s going to happen?” says Ricci M. Victorio, CSP, CPCC, ACC, managing partner at Mosaic Family Business Center. “Tigers need to prowl on their own. They aren’t usually good team players.”

Smart Business spoke with Victorio about the importance of “casting” people in the right roles to magnify their strengths.

What’s key to know about personality traits?

There are five basic traits most personality assessment tools use to define how people naturally perform. Each trait has two opposite styles with a midline where people are more flexible or adaptable. They are:

  • Dominance. Is the person more control-oriented, competitive and ambitious; or a team player who prefers collaboration?
  • Communication. Is the person more persuasive and energized by people; or reserved, preferring one-on-one conversation?
  • Procedural. Is the person more process-driven, organized and a good listener who needs time to make decisions; or flexible, creative and enjoys spontaneity?
  • Organization. Is the person more detail-oriented, wanting things done correctly; or strategic, big picture and concept-oriented?
  • Logic. Is the person more analytical, or intuitive when making decisions?

It’s interesting to note that leadership styles are determined by whichever trait is the highest. Many corporations recast CEOs depending on the stage of growth. A start-up could need an innovative, confident leader to make swift decisions and take calculated risks, while a more mature company might need a road builder or process-oriented leader to maintain the business.

How useful are personality assessments?

The surveys measure self-perception — how people see themselves and how they perceive the expectations of others. When hiring, you can’t rely solely on this feedback; it’s just one part of your vetting process. Also, results are dynamic and change as people evolve and their environment changes.

Personality assessments help create a baseline for understanding who we are and what we are experiencing. For example, in a demanding sales environment, you can increase success by looking for high communicators who are energized by personal interaction and adaptable. They need to be go-getters who can think on their feet and close the deal. Most assessments provide questions that offer greater insight during the interview.

What are signs your workforce isn’t gelling?

If you hire a high-dominant, low-extrovert manager to lead a collaborative team that is accustomed to brainstorming, the indirect ‘teller’ style of the new manager will be perceived as unfriendly and bossy. Team members will feel less valued, become disenfranchised and frustrated, leading to increased tension, absences or resignations. It is important to consider the desired behavioral attributes each position requires for optimum results, such as having outgoing, creative problem-solvers in people-oriented positions, and detail and process-orientated caretakers for more analytical roles.

How can you better understand your own behavior and management style?

Self-awareness is the first step in self-management. If you know you tend to make decisions hastily, never make an important decision without sleeping on it.

You also might struggle without knowing why you are feeling drained, stressed or anxious. In one case, an executive was proud of her open-door policy, but was feeling unsatisfied. She learned that it was causing her significant energy drain. She discovered that as a process-oriented, reserved communicator, it was more energizing to limit open-door interruptions to certain times.

Every personality is valuable and dynamic. It’s a matter of finding the right role that suits who you are and being able to adapt successfully to the world around you.

Ricci M. Victorio, CSP, CPCC, ACC, is a managing partner at Mosaic Family Business Center. Reach her at (415) 788-1952 or

Insights Wealth Management & Finance is brought to you by Mosaic Financial Partners Inc.

Published in Northern California

As an in-law coming into a family business, you’re stepping into one of the hardest working environments imaginable. A family member is held to a higher standard than regular employees, but an in-law has to work even harder than a family member.

“It really takes someone with vision and purpose because there will be a lot of extra challenges,” says Ricci M. Victorio, CSP, CPCC, managing partner at the Mosaic Family Business Center.

If you lay the right groundwork, establish clear expectations, and work with an adviser familiar with the challenges that will occur, she says it can be a productive and joyous experience.

Smart Business spoke with Victorio about how in-laws can successfully enter the family business and thrive.

What challenges do in-laws face when coming into the family business?

The hardest thing to overcome is perception. It doesn’t matter if you have an MBA from Cambridge or a Ph.D. from Harvard. When it comes to in-laws, the fact that you married into the business downgrades any credentials in the eyes of non-family managers or employees. People will tend to judge you harshly, so be patient and don’t take it personally.

How can an in-law successfully enter into the business?

The position, pay scale and responsibility must match the in-law’s experience and education. Thrusting an unqualified in-law upon people, no matter how great he or she is, makes it a much harder road. For example, an in-law was a sales manager making six-figures who was downsized. Now, he’s in trouble financially, and the family is worried. The family can bring the in-law into the business, which might be in another industry, but he shouldn’t start as the head of the sales division. He needs to learn the business and earn his way up the corporate ladder. If parents are still concerned about the financial gap, they can consider gifting additional monies from outside of the business — to help until he earns his way up.

It can be helpful to have the in-law candidate interview with the executive management team to gain support.

How can in-laws overcome the assumption that they have the boss’s ear?

You can’t expect the employees to be your friends, because they are going to assume that anything they reveal will get back to the boss. It can feel isolating and you have to be above reproach. Stay professional and never assume to be the heir apparent.

Also, if you have a problem, resolve things through the proper chain of command. If you’re not reporting to your father-in-law, don’t go to him when you have an issue.

Remember when you come home and complain to your spouse about work that you’re talking about a family member. Your spouse may get defensive, run to whomever you’re complaining about or start disliking that person. Try to share more than just the bad days.

What documentation is needed to protect the business, and the in-law?

Families with a high net worth business typically will require a prenuptial agreement that protects the stock from leaving the family in the case of divorce or death of the blood relative. However, there are incentives such as restricted or phantom stock for high-performing managers, which can provide financial incentives that feel like ownership for growing the company.

It’s also critical to create family member employment and stock qualification policies. These policies define the benchmarks and requirements for all family members, whether an in-law or not, as to how they can become stockowners or hold key executive positions, clarifying the pathway and making family employees more accountable.

Why is having a succession coach valuable?

Engaging a coach who specializes in succession transitions to help employed family members can smooth the predictable challenges along the way. Family employees, including in-laws, need a safe place to talk, and guidance to strategize through the maze of issues that will occur. The coach also can facilitate a family business council, which provides a venue for family members to talk about business related topics, questions and issues that would normally feel inappropriate to bring up in a productive environment.

Ricci M. Victorio, CSP, CPCC, is a managing partner at the Mosaic Family Business Center. Reach her at (415) 788-1952 or

Insights Wealth Management & Finance is brought to you by Mosaic Financial Partners Inc.

Published in Northern California

A typical family business could have four generations working to manage and grow the business. “The Traditionalist” 82-year-old founder is cautious, shrewd, still comes to work every day and holds the controlling stock vote. This person has no immediate plans for retiring and feels relevant by providing “practical” advice. “The Boomer” 57-year-old son serving as president has spent his career in his father’s shadow and is responsible for day-to-day operations, but doesn’t have true authority. The “Generation X” 30- to 44-year-old grandchildren are uncertain who will be the third generation successor, but have high financial expectations. The children of the Baby Boomers and Generation X, “Gen Y” or “Millennials” are the keys to moving the business into the future and want to be engaged in meaningful activities, but are the most disconnected from the company’s creation and development.

Generational diversity can contribute to misunderstanding, miscommunication, conflict and loss of productivity. So, how can you get all four working together?

“It is important to bring the generations together to discuss important family business issues with someone who has spent time with each of the individuals involved,” says Ricci M. Victorio, CSP, CPCC, managing partner at the Mosaic Family Business Center.

Smart Business spoke with Victorio about building trust and resolving business issues among different generations.

How can family members address issues to ultimately strengthen the company?

A facilitator/coach often teaches family members how to talk about difficult subjects without blowing up or running away and also how to listen to each other. Feelings that have been bottling up for years can come pouring or shouting out.

The older generation could feel disrespected and uncomfortable, as they weren’t raised to talk about feelings. The younger generation sees nothing wrong with baring their moment-to-moment lives on social media. The retiring generation could feel those who grew up with an entitled lifestyle don’t appreciate the sacrifices and hard work it took to build the business, while the incoming members could resent their inability to fully contribute, or feel unacknowledged for their work.

An outside coach can break problems down into small topics, including unwrapping family and business issues, slowly working toward sensitive areas. It takes time to build trust and learn where everyone is coming from.

What should be in place for new generations entering the business?

Have an agreed upon plan to clarify how family members come into the business, whether as a shareholder or as an executive. As an example, the plan would define what that next generation needs to achieve, both in education and work experience, before they come in as a manager. This document needs to be continually updated as operations become more complicated.

Decide whether all family members deserve stock. Consider having a stock qualification policy where perhaps you have to work in the business in some capacity for a defined period of time.

Another consideration is preventing family members from failing into the business. If the next generation isn’t meeting certain standards, which are higher than those for other employees, there can be conflict. So, set up definitions of control for both entering and exiting family members. Define the point at which authority passes to the next generation, and ensure the retiring generation has personal financial security by redeeming their stock over a period of time.

Do non-family businesses have these issues?

Every organization encounters generational issues, whether in the public or private sector. However, without family ties people tend to be more outspoken and straightforward. Younger workers don’t do well in the non-collaborative environment of cubicles and want to work smarter to have more free time. Baby Boomers prefer to hold employees accountable not only for what they do, but the hours they put in.

As with family businesses, both groups need to decide how to communicate and what they expect of each other. And once the agreements are in place, play by those rules. ?

Ricci M. Victorio, CSP, CPCC, is managing partner at Mosaic Family Business Center. Reach her at  (415) 788-1952 or

Insights Wealth Management & Finance is brought to you by Mosaic Financial Partners Inc.


Published in National

If you are a business owner, key manager or employee of a company going through an organizational transition, such as a merger or leadership change, it is likely you will experience performance disruption caused by confusing messages, speculation or lack of information. And you are not alone.

Often the planning for these important events happens behind closed doors with only the owners and advisers, leaving everyone else to speculate about the future.

Ricci M. Victorio, CSP, CPCC, managing partner for Mosaic Family Business Center, says business owners can avoid these challenges by being more transparent about upcoming changes and engaging everyone in the process.

“The key is communication, communication, communication. It’s important to identify what you can control and learn how to be flexible with all the rest. When you’re getting ready for a transition or succession, you might feel like you’re surfing a tidal wave. There’s an art to keeping your balance in an ever-changing world,” she says.

Smart Business spoke with Victorio about how to prepare yourself and your company for major business transitions.

What are the most common stumbling blocks that occur when a company is heading for change?


The most common stumbling blocks typically center on communication. Today’s older generation grew up learning to keep financial affairs close to the vest. So sometimes even a spouse doesn’t get involved in the planning until asked to sign papers.

Other times, people don’t feel comfortable sharing their ideas and concerns during shareholder meetings because they’re afraid of disrupting the artificial harmony that’s been established. They may have private conversations outside of the boardroom, but during meetings there’s often a fear of disrupting the delicate balance.

Further, business owners involved in a transition can be so overwhelmed by either the fear of confrontation or the lack of planning, the project begins to loom large and they’re stopped in their tracks. They feel as if there’s no way they can get through it; it becomes so daunting they often just hope it goes away.

How can these stumbling blocks be avoided?


Instead of keeping all conversations behind closed doors, when appropriate include key players such as family members, managers and those who will be most involved in the strategic design of the transition plan before you start actually planning. In these conversations, ask the group, ‘If we could do anything without worry of failure or confrontation, what would be best for our family and company?’ At this stage, there should be no pressure of commitment; it’s just brainstorming and idea building.

Engaging a succession coach can help facilitate dialogues that are creative, innovative and energizing, and potentially serve as the foundation of solutions to what might seem like an impossible endeavor.

Once you have a vision, you can develop an implementation plan. Break it down into a timetable and get key players involved to determine who spearheads specific initiatives and what the outcomes should be. Document the vision and itemize each step to be executed on a schedule for all involved.

Owners and other decision makers in a business likely won’t find it easy to facilitate these discussions, so consider using an experienced adviser to guide and focus the conversations and break the task into manageable segments. It can be difficult and even intimidating for groups to internally identify and discuss their own problems, but it’s helpful to have someone from the outside keep discussions open, comfortable and inclusive.

It’s also important to reach out to the overall organization, including employees, clients, customers, franchisers and vendors to communicate the vision of the plan — not the intricacies, but the expectation of the fulfillment of the plan and how it affects each party. This will help clarify what each can expect and what their roles will be.

What are the red flags that tell you a transition is going badly or not as planned?


Confusion or dysfunction within the management team is one of a few signs of difficulty that typically arise during a transition. Often it’s revealed that management is unsure where the company is going or what the plan is. Additionally, departments that are not cooperating well with each other — also called ‘silos’ — can typify dysfunction.

If management isn’t confident that the transition will include them, their productivity will slow and they’ll likely start looking around for something more stable and secure as a backup plan. A high level of turnover in management might prompt others to start abandoning ship.

When is a good time to seek outside counsel?


The best time is when you know or others are imploring you to consider that it’s time to begin succession planning. For any business owner between the ages of 45 and 75, if you have a business that is worth perpetuating, you need a long-term strategic succession plan and a short-term contingency plan to protect it. It’s worth bringing in an adviser who can help you with both kinds of plans. You’ve got to think beyond your own needs because your business has so many people tied to it who count on its success.

All of the planning responsibility doesn’t have to be on you. You can pull people into the transition process and get them enrolled so you’re no longer alone in the endeavor. If or when you do step aside, you can do so knowing you have people there to maintain and even grow the business. The hearts of those involved in the company might be broken when a founder passes or moves on, but that creation, built lovingly, does not have to crumble.

Ricci M. Victorio, CSP, CPCC, is managing partner for Mosaic Family Business Center. Reach her at (415) 788-1952 or

Insights Wealth Management & Family Business Consulting is brought to you by Mosaic Financial Partners

Published in Northern California

Many people use the terms “consultant” and “coach” interchangeably, but the approach of each can be quite different, says Ricci M. Victorio, CSP®, managing partner and executive coach at Mosaic Family Business Center.

“A consultant may suggest ideas and offer solutions. However, if a subtle emotional shift signifying resistance or confusion occurs, the approach needs to shift into coaching to find out what’s going on,” Victorio says. “Once clarity is re-achieved, the conversation can return to strategies.”

Smart Business spoke with Victorio about how a multi-faceted adviser will know when to wear each hat and how you can take advantage of those skills.

What is the difference between consulting and coaching?

A consultant is focused on solving specific problems, bringing ideas, experience and solutions to help solve an issue. He or she will advise you of your best options and not get too personal. But when dealing with personal issues, such as in family businesses, it’s not so cut and dried. Standard ideas may not always provide the win/win solution. The discussion with the client and his or her family, where everyone is pulled together, will create a resonating plan for the future.

This is where coaching becomes a dynamic skill set for the adviser. A coach will not get caught up in solving problems, which can be outlying symptoms of a much bigger issue, and will focus on the deeper, big picture topics. A safe and collaborative dialogue will help business owners explore their ideas, vision and facilitate the dialogue with key family and managers. It is the coach’s job to guide this exploration, and then as a consultant help them move forward with confidence.

Where does coaching begin?

A coach will first help identify what is important to the client by asking questions that focus on what is going on right now with the business and family, and the impact they have upon one another. Then consulting comes into play with a deeper understanding of what is important to the client. Ideas turn into action steps and are more succinct and meaningful.

Finding an adviser who is trained to alternate between the role of consultant and coach allows the discovery process to focus on both sides of the decision — first identifying the vision and secondly developing a strategy to achieve it.

What are the dangers of using an inexperienced adviser?

Be careful when advisers use standardized solutions and rush to a conclusion without taking the time to dig a little deeper. The solution may be a really good one, but it also may not be creating a win/win for your business and family. And if the business owner is pushed into solutions that do not address what is actually causing the problem, the process will stall. It takes a different kind of approach, as well as a different presence and mood, to get people to open up and talk about what is really bothering them.

The coach needs to have an open, curious mind and keep pulling back the layers to look at what’s underneath. If the coach will take extra time to look beyond the surface, the answer will emerge. When it does, everyone recognizes it and it seems so simple. This takes patience and a willingness to be vulnerable while exploring many options.

How can utilizing someone trained as both a coach and consultant benefit a family business?

The strategic decisions that business leaders make affect their lives and those of their families and employees. It’s not the technical aspects of planning that jam people up; it’s these personal decisions and their impact upon everyone and ultimately the success of the business. An adviser trained in both capacities will facilitate deeper, more meaningful conversations that get to the truth and uncover emotional baggage, undermining fears and withheld concerns. Once the ‘elephant in the room’ has been recognized, an open dialogue can take place between all involved parties. As people begin speaking their truth, getting people unified in the decision-making process becomes much easier.

How can this relationship empower individuals to make choices?

People want to be respected, empowered and know they are capable. The consultant/coach should work with you from the perspective that you are creative and resourceful, which is different from, ‘You don’t know much about this situation and you need me. I can fix this.’ It creates a dynamic partnership between the client and adviser.

How can a multi-faceted adviser help integrate a business owner’s personal and business lives?

You can’t separate business decisions from your personal life, just as you can’t separate your personal self from your work self. If you find yourself feeling frustrated or unable to move yourself, family or company forward in planning for the future, a multi-faceted adviser can help you get to the core of what is holding you back from making progress. Once this is accomplished, the business or family issues that once seemed so overwhelming won’t look so daunting anymore.

Mosaic Financial Partners is a boutique, fee-only wealth advisory firm dedicated to improving its clients’ lives by providing financial solutions and customized advice to help its clients attain their lifetime goals and aspirations. Mosaic is comprised of 10 Certified Financial Planners™ who work with businesses, families and individuals. Mosaic Family Business Center is affiliated with MFP. Together they combine investment management and comprehensive, on-going financial planning and counseling by integrating the various pieces of the client’s lifestyles into a meaningful whole enabling its clients to make good personal financial decisions and achieve their dreams. For more information visit or, or call (415) 788-1952.

Ricci M. Victorio, CSP®, is managing partner and executive coach at Mosaic Family Business Center. Reach her at (415) 788-1952 or

Insights Wealth Management & Family Business Consulting is brought to you by Mosaic Financial Partners

Published in Northern California

As a family business owner, you may want to bring your children or other family members into your business. You may have already done so and discovered it’s been a bumpy ride. How do you do work with family members and still protect family relationships?

According to Ricci M. Victorio, CSP®, managing partner at Mosaic Family Business Center, this can be a difficult thing to do.

“When family members work together, the boundary between work and family time becomes blurred, and the relationships overlap,” says Victorio. “Families need to think through how to separate the parent/child relationship from the owner/employee relationship.”

Smart Business spoke with Victorio about how to preserve family relationships and set boundaries while working together as a family.

Why is it important to separate family relationships from business relationships?

It’s pretty clear that you can’t run a business like a family, and you certainly can’t run a family like a business. So when family members work for you, it can get very complicated. Family relationships are based upon unconditional love and acceptance. Business is all about performance and accountability. So how do you hold your family members accountable to performance without getting it confused with love? How do you demote or fire a family member without destroying your family? It is naïve to think that your company’s employee handbook will be sufficient for these complicated issues.

How do you untangle those relationships?

An experienced succession adviser can help you create a family member employment policy to define the qualifications for entering the business, such as education and job experience. This should include the minimum requirement of two to three years working somewhere else before beginning their career in the family business. Working in an environment where your successors are employees and a manager can hold them completely accountable for doing stupid things or be acknowledged for doing a great job is extremely important before coming under the scrutiny of your management team.

In a family business, negative behaviors of developing successors might be overlooked, tolerated or excused, but in the outside world, where their last name isn’t on the wall, these behaviors create real consequences that provide opportunities for learning.

Secondly, the adviser can help you design your expectations of what it is to be a family member employed in the business. Make it clear that because they are family members, they are going to be held to a higher standard:

  • We expect you to be here early, to stay late and be the example.

  • Keep a positive attitude and opinions about family members or management to yourself.

  • Be gracious and respectful. You can learn from everyone.

  • Be willing to do any job that’s asked of you.

How do you set expectations for managers of family members?

Bring your key managers in as mentors to define how you want to handle your children’s professional development, as well as the predictable bumps and challenges.

Triangulation can be a really big problem in family businesses. For example: The manager is asked to train and manage Dad’s son, Sam. But Sam is acting up, coming in late and overall not doing a very good job. The manager chastises Sam and gives him specific instructions for modifying his performance.

Instead of taking the correction as an opportunity for growth, Sam complains to Mom who then goes to Dad saying Sam is being treated unfairly. This forces Dad to ask the manager why he’s being unfair to Sam, putting them both in an awkward situation. Does the manager please the boss and spoil the child, or does he try to be a good manager and make sure the job is done right, standing up to the boss and saying his son is not doing a good job?

The best thing you can do is talk about triangulation before it happens. Sit down with your managers and define how you want to interact with them. If a situation arises, who decides the course of action? You need to build a bridge of communication so the owner, parent, manager and incoming family member have the opportunity to talk these things through before relationships get tangled up.

If a family business hasn’t planned up front, is it too late to make changes if the child is already working at the company?

It’s never too late. A succession adviser can help you begin to untangle the knots that have people tied up. Next-generation family members can exhibit entitled, blasé or even toxic behavior at any age.

Don’t think you can turn a blind eye to it if you want to have a smooth and successful leadership transition. The situation can be turned around if you address it with determination and commitment.

Tough love may be required. For children to succeed, parents need to hold them accountable, set boundaries and communicate their expectations or ground rules for participating in the family enterprise. Included in these ground rules, there must be accompanying consequences for noncompliance. After all, employment should be considered an opportunity, not a birthright.

You love your child unconditionally and will love him or her forever, but this does not always qualify a family member as a good fit for your business. Your job as a parent may be to help that child find a career in which he or she can succeed, even outside of your business.

Many business owners feel it’s not worth all the ‘trouble’ to bring their children into the business. However, if done right, it can be extremely rewarding to to see your children growing and thriving in a business that you’ve created, contributing to the company, being respected by others and perpetuating your legacy into the next generation.

Ricci M. Victorio, CSP®, is managing partner at Mosaic Family Business Center. Reach her at (415) 788-1952.

Insights Wealth Management & Family Business Consulting is brought to you by Mosaic Financial Partners

Published in Northern California

When family business owners prepare for the next generation to enter into the business, most families initiate discussion of the succession process.

However, for unrelated business partners, this can be an entirely different situation, says Ricci M. Victorio, CSP®, managing partner at Mosaic Family Business Center.

“You need to talk, before it’s time to retire, about how the business is going to continue with or without your presence,” says Victorio. “No matter how young, healthy or determined you are to stay at the helm, if your sudden departure would be devastating to the business, you need a contingency succession plan. And ‘devastating’ is not a word you want as part of your strategic plan.”

Smart Business spoke with Victorio about how to ensure that your business will continue to thrive and grow.

How does succession in professional firms differ from that in family-owned businesses?

In a family business, parents will introduce their children into the business at a fairly early stage in their professional careers. Throughout their maturation, if all is going well, employees, clients and vendors become familiar with the next generation, understanding that at some point in time, there will be a transfer of control and eventually ownership. A parent can start transferring stock to a child or a family trust over many years. It can be purchased out of bonuses, gifted or inherited.

In a professional firm, however, the succession challenge is in buying out retiring partners who are still earning full salaries and stock payouts. Gifting or inheriting is certainly never an option in nonrelated stock transfers.

How do you create a profitable environment to allow younger partners to be able to buy the stock in a shorter period of time when all of the cash is going out to the senior partners?

Founding partners tend to have the most significant clients, and passing them on to junior partners is a complicated process in retaining client confidence and to the firm as it relates to who receives the lion’s share of the billing credit and income.

How can you begin to create a pathway to develop future partners and help them learn to market the firm?

Though the younger associates may have been working under the lead professional handling the task management of serving clients, they probably haven’t learned to market and perform business development. Partners are concerned that new clients may not emerge if they retire, thus creating a potential revenue impact on the firm and in their buyout price. A typical question asked is, ‘If we stop working, who will bring in new clients?’

Business succession is not unlike family succession. Here are some helpful tips to consider:

? As a senior partner, you need to groom younger people by creating opportunities for clients to work with you and your protégé.

? Mentor the younger person by giving him or her more responsibility and allow the client to interact with that person.

? Tell clients that you work in teams because you want to always have someone who understands the project, even if you are unavailable. This is a key point and one that is often overlooked.

? Appoint a young, talented potential successor as the client’s primary contact but continue to work as a team.

? Succession is occurring on multiple levels, including in your clients’ business, so it is important to match younger people with like-minded clients. This will aid professional firms in keeping long-term clients as the business goes through succession.

How can a senior leader transition to a new role before retirement?

This is a delicate conversation because you’re talking about affecting the financial stability of high-powered professionals who wish to maintain their income. You want to increase productivity and profit by using the founders’ expertise and connections to bring in new clients. Founders can explain to clients they are still involved from a strategic or global viewpoint and introduce highly capable, qualified younger associates to handle the actual casework, which will build confidence and new relationships.

As a result, profits and stock value improve, and salaries can be increased for new and existing staff. It is critical that new staff understand that they are progressing and have potential for growth, or they will move on to another firm where those opportunities are present.

You also need to redefine the roles and responsibilities of the senior members. This discussion can be more easily accomplished (and without the drama) through the facilitation of an experienced succession coach. Salaries can be realigned for fewer hours, providing revenue to pay the next tier of partners. You retain the skills of senior members while creating a circle that continues to build success.

Succession planning must be a fundamental element in every business’s strategic plan, even if you’re not looking to transition in the near future. It is always important to be prepared for a change within your business and provide a smooth transition for the clients; because, leadership change can occur without warning.

Ricci M. Victorio, CSP, is managing partner at Mosaic Family Business Center. Reach her at (415) 788-1952.

Insights Wealth Management & Family Business Consulting is brought to you by Mosaic Financial Partners

Published in Northern California