Eric Dufour
Vice-President, Partner | FCPA, FCA | Business Transformation

The workforce shortage is a major issue that requires SMEs to be quite agile. In this respect, an effective and timely succession plan is a very useful tool to retain the best talent within the organization.

Some of your best-performing employees could therefore be involved in the eventual transaction, becoming future shareholders. To this end, communication between the transferor and potential buyers must be clearly established. The current business owners must indicate their intentions. If they want to leave the organization in five years, they need to be up front about it. Nowadays, business succession is no longer just a family matter.

Therefore, have the courage to discuss the issue directly with those you think could eventually take over internally. Three steps make it easier to complete this transition project.

A– Identify key employees

Have the employees you’re considering established a career plan? Do they have the requisite entrepreneurial skills? What are their professional goals? These discussions set the stage for the next steps. For example, you could give targeted employees a few management assignments in advance to gauge their interest and see if they have the right job profile.

These additional responsibilities assigned over time can also facilitate the transfer of authority. The financial capacity of the buyers to obtain the required financing should also be considered. They can then benefit from a gradual integration into the shareholding structure. At the same time, the buyers will increase their participation in the organization.

B– Get help

Entrepreneurs obviously can’t do everything alone. People who transfer ownership of a company they’ve been running for 25 years sometimes think they can navigate the transfer maze on their own. Beware of this wishful thinking. The support of a specialist can make all the difference in the development of a succession plan. Using an external resource ensures that you have a fresh perspective on the situation. And what could be better than to be able to count on leading-edge expertise to leave nothing to chance?

Lastly, remember that a business transfer is not something you can improvise. By relying on a specialized team, you can anticipate potential problems and gradually transfer the required knowledge. Transferors should not disappear overnight following the conclusion of the transaction.

C– Ensure a smooth transition

Over time, potential buyers will put their own stamp on the business. The transferor and buyer should expect an overlap during the transition process. It is not uncommon to see the buyer get involved during the first year following the transfer and even to hold the position of board chair. This type of transfer doesn’t just take place at the time of the visit to the notary’s office: rather, it is spread over a period of time.

You have to trust the leaders you choose to carry out the process. They may have different methods, but you have to accept these differences. For their part, buyers must understand that it is a part of yourself that you’re leaving in their hands.

Get employees involved and ensure their loyalty

If you plan to withdraw from the business, state your intention early enough to allow for the development of a proper succession plan.

By letting it be known that there are opportunities for advancement as a result of your eventual departure, you give key employees a chance to demonstrate their interest and skills and, perhaps, invest their energy in ensuring the sustainability of “their” SME. That way, you can be sure that you can count on your best collaborators in the coming years.

30 Sep 2021  |  Written by :

Éric Dufour is a vice-president at Raymond Chabot Grant Thornton. He is your expert in management...

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Clara Demers
Manager | Human Resources Consulting Practice Leader | Business Transformation

When it comes to business transfers, setting up a family council can be a winning strategy for ensuring the sustainability of a business.

Over the next few years, many Quebec businesses will be transferred to buyers from within the family circle.

In some cases, it’s also possible that external buyers will also be involved, but the fact remains the same: multigenerational management is an issue that family businesses must face.

Starting an entrepreneurial succession process is a long and complex project. In the context of a family succession, the stakes, emotions and feelings are put to the test. It’s like airing problems and issues that are usually private.

Preserving the harmony thanks to a family council

The family council is a key structure when the family grows and the family-business relationship becomes more complex. It provides an opportunity for family members to express themselves. However, setting up a family council is not automatic.

It’s important to understand the family history, ties and relationships between family members. When we undertake a business succession assignment, it’s essential to have a human approach and a proper grasp of all aspects involved.

This is even more true in a family succession context. It’s almost like interfering in people’s private and professional lives; some discussions will be easy, but others will be more difficult and painful. The complexity of the case will determine whether or not to involve a family council. In complex family succession cases, a family council can be very useful for all parties involved.

What is seen in most cases is that when the future management team, which includes external members and others from within the family circle, meets, some things may be left unsaid. And if they are not addressed, these unspoken things can be detrimental to the proper functioning of the management team. That’s where the family council may have a role to play.

When setting up the family council, it’s important to define a broad framework and structure that includes all family members. It’s also essential to identify a common goal. Achieving this goal requires active listening and honest participation by all.

The family council’s mission is to preserve family harmony while ensuring the business’s stability. To achieve this, everything depends on good communication between the participants.

The family council as a place of exchange

Our approach to the practice is very human; our desire is to satisfy everyone, and in order to achieve this, we must let everyone express themselves and hear them. We set up a family council in which we play the role of mediator. This council meets about twice a year and offers all family members the opportunity to share their opinions and resolve certain situations.

The family council is an ideal place to communicate, exchange and set policies and procedures concerning family members, such as hiring them in the organization.

Family council sessions are not family meetings; their purpose is to resolve situations and address concerns. In a family succession context, there is tension and disagreement. Our role is to guide these meetings, but to do so, all family members must be present.

Family councils are opportunities for everyone to express themselves and be heard. It’s not about interfering in family life, but rather it’s a window where everyone can speak and be heard.

What do the external buyers think?

This approach is very well received by external parties taking over, who encourage and respect this practice. It’s also in their interest to put all the chances on their side to ensure the sustainability of the business. Moreover, the family council is not a decision-making forum, so this does not bother external buyers who are in favour of such an action. Instead, it helps preserve harmony.

Preparing the next generation

The family council also helps to raise awareness and prepare the future generation that will take over the business. By valuing members, they act on the family’s behalf to preserve its heritage, which will have a positive impact on the company’s sustainability.

For more information, contact our team.

30 Sep 2021  |  Written by :

Clara Demers is your expert in Business Transformation at Raymond Chabot Grant Thornton. Contact her...

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Jeannette Boulanger
Senior Manager | CPA, CA, M. Sc. | Human resources consulting

Everyone is talking about the labor shortage. How can we create the right conditions for hiring?

1- Look past resumes and keep an open mind

We all know there is no such thing as the perfect candidate. Skills and experience are obviously important, but it is worth looking beyond these considerations.

  • What are the candidate’s aspirations for the position and their career in general?
  • What are their areas of interest?
  • What are their core values? Are they aligned with those of your company?
  • What potential do you see in the candidate?
  • What are their short- and medium-term career goals?

By looking beyond people’s resumes, you may discover hidden talent. With enough time and training, these people could become the key players you’ve been looking for.

2- Encourage internal mobility

Keep talent within your company by encouraging workers to apply for lateral or vertical moves. Even if they don’t have all the skills required for the job, your current employees have the advantage of being familiar with the company and its values.

Finding and training external talent is costly for organizations and involves a certain adjustment period. Meanwhile, giving employees the chance to do something new can contribute to an improved sense of belonging. After all, people shouldn’t be discouraged from wanting to learn new things and expand their skill set. Not only will providing workers with in-house opportunities translate into better retention and engagement levels, it will also help employees grow at a faster pace. It is a win-win situation.

Find out more about talent development.

Find out more about knowledge transfer.

3- Assess employee wellbeing regularly

The past year has been challenging—both personally and professionally—for all of us. Psychological distress and health problems, related to COVID-19 or otherwise, plagued a lot of people. Some are still suffering. Everyone has their own way of reacting to the situation. That is why it is important to keep an eye on employee wellness indicators.

Check in with your teams on a regular basis to make sure they are feeling well both physically and mentally. This can be as simple as making informal calls, sending monthly questionnaires, or planning a lunch or virtual tour to connect with your workers and teams.

By taking an interest in your employees, you will be able to monitor their health and bolster their engagement.

Find out more about worker health.

4- Be open and flexible

Work arrangements have become a hot topic and there is no shortage of options, including: 100% work from home, 100% work from the office, or hybrid work with or without fixed days. To choose the one that’s right for your team, consider surveying your employees and asking them what they want. Since each person and business is different, look for an option that reflects your needs and goals, as well as those of your clients and staff.

Then be flexible in how you apply your policy. Today’s workers are looking for ways to balance their personal and professional lives.

Find out more about hybrid work.

Find out more about work and life balance.

5- Be real, be yourself

Cultivating solid relationships with your personnel is essential to building employee engagement. Show them that you’re human too. Express an interest in your employees and let them know that they are important to you and to the company.

Be genuine. As a manager, you can’t do everything or know everything. That is why you need to surround yourself with good people. By being open, you will gain their respect and build trust.

Find out more about how to communicate effectively with employees.

29 Sep 2021  |  Written by :

Jeannette Boulanger is a Human Resources Consulting expert at Raymond Chabot Grant Thornton. Contact...

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Katy Langlais
Manager | CRHA, MBA | Human resources consulting

Workforce shortages are a challenge and keeping your employees engaged with the company is more important than ever.

It’s important to remember that your employees are your organization’s most important asset, and one that can contribute the most to its development.

Numerous surveys reveal that employees who are strongly committed towards an organization contribute to its growth up to two and half times more than do other employees. It was observed that organizations that neglect employee mobilization risk losing their trained and experienced employees as well as the financial investment that goes along with training, recruiting and hiring new employees.

The highest performance is found in organizations that promote an organizational culture based on motivation and surpassing oneself, and that use this to attract qualified resources and retain motivated employees.

Ten tips for creating commitment

Here are ten tips that employers should keep in mind when managing daily activities in order to increase their employees’ level of commitment towards the organization:

  1. Provide a clear vision of the organization’s goals, expectations and objectives;
  2. Provide a detailed description of employee tasks;
  3. Ensure that employees understand their tasks and how they can contribute to the organization’s objectives;
  4. Provide clear feedback on the organization’s results;
  5. Recognize the efforts of committed and efficient employees;
  6. Offer competitive compensation;
  7. Provide career advancement opportunities;
  8. Offer professional development;
  9. Involve employees in decision-making;
  10. Make financial participation in the organization available.

Employees, A Key to Success

It’s generally believed that employees who feel satisfied with their professional environment work better, serve clients better, work better with their business partners and thus, have a more positive impact on an organization’s productivity. While all of this may be true, there’s more; employees would also like to:

  • Have a relationship of trust with management;
  • Contribute to the organization’s culture and values;
  • Maintain a good work-life balance;
  • Have a working environment with good team spirit and pleasant inter-professional relationships;
  • Get involved in causes that they hold dear and receive support from their employer.

Having a clear vision and an employee performance management structure based on the above are instrumental in creating an environment that is conducive to development and increasing employee commitment. Remember that employees are at the center of an organization’s success… and its challenges.

However, over and above the various initiatives that can be implemented to promote employee commitment, strong leadership is likely one of the best ways to motivate and mobilize employees.

28 Sep 2021  |  Written by :

Katy Langlais is a recruiting and human resources consulting at Raymond Chabot Grant Thornton.

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