What is the importance of and the motivation for business succession planning?
A. Traditionally, most advisors have assumed that family business succession failures are primarily due to the impact of taxation and to poor decisions that were made relating to the transfer of authority. As a result, many strategies relating to succession planning are tax driven. Some recent research studies would suggest, however, that perhaps only 10% of most business breakdowns is attributable to planning and control issues, which traditionally have been a primary focus of succession planning. Rather, a substantial number of succession planning failures can be attributed to problems in the relationships among family members and to the heirs not being adequately prepared. Some authors suggest that professionals involved in business continuation planning should assess problems and solutions with a view to more than the tax objectives. Rather, a balanced approach goes beyond some of the traditional objectives of estate planning. Because the preference of most business owners appears
