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Succession Planning: The #1 Question Advisors Ask Me

Updated: Mar 19

When it comes to Succession planning, one of the most frequently asked questions by financial advisors is, very simply: Where Do I Start?


And though it may sound trite, my suggestion to all of you who are thinking about developing your Succession plan is: start by understanding your ‘Why’ and creating a clear ‘Sense of Purpose’.


Every great endeavor throughout human history has had at its core an underlying sense of purpose or mission.


Your own Succession plan – which to each of you is, rightly so, your own personal ‘great endeavor’ - is no different. It needs an underlying Sense of Purpose that acts like a north star, guides your decision-making, and enables you to overcome challenges and adversity.


So, when an advisor first comes to me and the topic of Succession planning comes up, I always start by helping them understand their ‘Why’ and developing their ‘Sense of Purpose’.


I begin by asking him or her a series of basic questions.

First off, I ask them what they are trying to accomplish with their SP? What are the Outcomes and Benefits you hope to achieve? For example,

From a Strategic perspective, are you trying to:

  • Create a business model that is intended to endure beyond your career? Or…

  • Create a business model that will enable you to stay engaged in the business over time…but able to focus on fewer households? Or…

  • Are you trying to monetize and maximize the value of your business…and reap the rewards of a lifetime of work?

From a Financial perspective, are you hoping to:

  • Obtain a certain income stream or achieve a valuation that will sustain you and your family during your retirement years? If so, do you know how much you need…and whether your business is worth that much?

From an Operational perspective, are you looking to

  • Ensure the well-being of your clients…and staff members once you exit the business?

  • Are you looking to find a successor or buyer that shares your values, business philosophy and model?


Next, I ask them to share with and describe for me their Core Values.


Every person’s Sense of Purpose will be heavily influenced by their core personal values and beliefs.



For a variety of reasons, it’s critical that an advisor understands what is important to them and what makes them tick. It will lay the groundwork for their Succession Plan – the direction it will go, how they will get there, and, in some cases, when.


It’s also important that an advisor also understands not only the Values that guide their personal lives but also those that guide their approach to their business.


I also ask advisors to describe for me their Definition of Success at various points along the Succession planning process – again, not just for their business but also for themselves personally and for their families.


After all, your business is not your entire life, and you are more than just your business.


Lastly, I ask advisors to describe for me how they envision their Role in the business evolving over time.


Just about every founding advisor I know plays multiple roles in the business, whether it be as owner, manager, lead advisor, head of business development, etc. The reality is that your role in the business will (and should) change over time. The key is to be planful about it so that you can control the change instead of having it control you. Ideally, at some point in the latter stages of your career, you want to be in and perform only that role which you most enjoy and find most fulfilling.


So, this is where you should start - by asking yourself these basic questions – about your goals and objectives, your values, and your role - to help you better understand your ‘Why’ and to create a clear ‘Sense of Purpose’.


By doing so, what ends up happening is you bring great clarity and focus to your Succession Planning process.


By starting this way, you ensure that your Succession Plan will be focused on the broader Purpose, Vision and Strategic Direction that you’ve set for your business, yourself, and your family.


It’s helpful at this point to remind yourself that Succession Planning (like any other kind of strategic planning) is never an end unto itself. It’s always a means to an end. And that end needs to align with your Values, your Vision, and your Definition of Success for your business, your life, and your family.


Understanding Your Why and Sense of Purpose also creates the strategic context and a clear Analytic Framework and set of Criteria to evaluate the merits of any opportunity that comes before you or set of choices that you ultimately will have to make. For example, among other things, it will enable you to clearly identify the profile and characteristics of your Ideal Successor(s).


Simply put, without understanding your ‘Why’ or Sense of Purpose, it will be exceedingly difficult, if not impossible, to effectively develop and implement a Succession Plan that will achieve your desired end results.


Quick story to illustrate this point.


Earlier in my career, I was responsible for helping lead the corporate strategy team at one of Canada’s leading life insurance companies.  


In the late 90’s, due to a changing regulatory landscape, many of Canada’s larger lifeco’s became publicly traded companies and had some very big decisions to make with respect to their future.


We were asking ourselves questions like – do we stay a small independent publicly traded company? Or do we sell ourselves to the highest bidder and monetize the company? Or do we merge with another larger firm and hope to continue to operate as the Canadian arm of a multi-national firm?


These were significant existential questions that in many respects are no different in kind to what advisors themselves face when contemplating their Succession plans and Exit strategies.


The problem for us was that there were too many different options and opportunities that we could have pursued, and we didn’t know how best to focus our efforts and our resources.


In essence, our challenge was that we didn’t understand our ‘Why’. As a result, we had nothing to guide our actions and behaviors. What did we do? We met with the CEO and his Executive team and said to them that it’s exceedingly difficult for us to know what to ‘do’ when we don’t know what you want this company to ‘be’.


Meaning – clarify for us your purpose, your strategic objectives and outcomes, and your desired end game.  Tell us what ‘success’ looks like. Armed with that sense of direction and strategic context, we were able to then go and develop a strategy and options (in essence, the company’s Succession Plan) aimed at achieving that end game.


Once we had that level of clarity on the Why and the Purpose, our team engineered a strategy that helped the company achieve its broader strategic objectives and enabled it to continue to maintain for years thereafter its presence in the communities it served.


The Key Takeaway here is the following:


  • Start by understanding your ‘Why’ and create your ‘Sense of Purpose’;

  • Be crystal clear on what’s driving your Succession Plan and the outcomes you want to achieve;

  • Understand your Core Values and ensure that decision-making and actions align with them;

  • Articulate a clear Definition of Success not only for your business but also for yourself and your family.


Given what’s at stake in connection with your great endeavor, you can’t afford to not know or lose sight of what’s important and find yourself going down the wrong path.


If you want help in understanding your Why or creating your Sense of Purpose, feel free to call or email me.


Till next time,



Do you understand your "Why" and "Sense of Purpose?"

  • Yes - I'm ready to plan.

  • No - I need to work on this.


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