The Power of “Psychological Succession”

After 12 years as managing partner of Banyan, I recently stepped down, passing the leadership baton to my talented colleague, Ben Francois. A core part Banyan’s work is to advise family business owners on generational transitions and succession, which we do well. But I had nagging question – were we going to be the “cobbler’s children” (the old folk tale about how the cobbler was too busy to ensure that his own family were wearing shoes) and fumble our own leadership transition? We know many professional services firms don’t survive the founders’ exit. I’m happy to share that I think we’ve transitioned well, not just because we have deep experience advising on that, but because I learned something valuable in our succession process: the importance of “psychological succession”.

We’ve seen with our clients that the impact of a successful career is rarely linear across the years. While you may feel consistent growth and impact during the years, you hit an important inflection point toward the end of your career–a high impact zone when you are a leader, CEO, managing partner, or possibly primary owner. It’s then when you can have the largest and lasting impact on the people, organization, and communities you care deeply about.

At the same time in a career, you sense that the clock is ticking on how much time you have left to make that impact. As Warren Buffett once said, “I can buy anything I want, but I can’t buy time.” As I was working my way through my succession process, I saw opportunities in that high impact zone that are different from the rest of my career. With big impact and not much time: the urge to control becomes profound.

If you have a chance, you should read the 1998 best-selling book, Who Moved My Cheese. The book shares an idea that still sticks with me that to take advantage of my time in the high impact zone, perhaps paradoxically I had to let go of my former controlling instincts—that cheese has moved. This is hard for most people, and for me. With the end nearing, it’s natural to want to control the ending, and beyond. That doesn’t mean you stop caring about how your company (or department, or work group) will do without you at the helm, but you must accept that you have to emotionally let go of controlling the things you once did on a daily basis without a second thought.

Control manifests in two forms: Negative and positive. On the negative side, I’ve witnessed in many of our clients a control fallacy – they believe they can find ways to still control the people, the direction, the priorities, and values of the organization (or family) they care deeply about, even after they’re gone. We know one patriarch of a family business who was so controlling that he put his family’s substantial businesses and wealth into a trust that couldn’t be touched except by court order for 180 years (6 generations!) That’s literally trying to control what he most cares about from the grave. We know another family business owner who, at age 87, created a family constitution about how things will work in the family for generations. We told him that that won’t work. When he is no longer around, the family will certainly do something other than what he’s willed to happen. Such trusts and constitutions are a core source of conflict in business families, as some in the next generation try to respect the founder’s intent and others want agency to do what they want.

As I was working through my own succession, I realized that trying to find ways to extend my control in a similar way would be destructive, and given the high impact zone of your career, it’s also dangerous. The damage to the people and business is likely to be traumatic.

Instead, you must direct your psychological need for control to things can you positively control: yourself, your boundaries with others, and your environment. You must actively choose to retool what you care about. This is hard. I’ve spent 12 years caring deeply about my firm’s people, clients, and success. Many sleepless nights, long days, hard discussions and decisions. But you must give up what you care most about.

You need to set strict boundaries with others; in business this can often mean not telling stories on how you did it in the past or what decision you would make now. You need to let the next generation of leaders find their own path. You’ve done your part, now it’s their turn. If you have done your mentoring well, they will be fine. I will never forget asking a patriarch of a large family business why he wasn’t worried that the tremendous wealth flowing to his next generation, who were in their 30s, would damage them, as large wealth often does. He looked at me and calmly said, “Rob, we raised them well. They will be fine.”

And you need to change your environment—the pond you swim in. But how? Harvard Business School professor Clayton Christensen and Karen Dillon (my colleague here at Banyan) wrote a great book, How Will You Measure Your Life?, in which they ask readers to answer that question for themselves. I’ve edited this a little bit for me, asking “How will I measure my life now?” Because if I’m in that high impact zone and I don’t have endless time, I better have a clear answer for that question to guide what I care most about and how I spend the precious time I do have.

I’ve also borrowed another question that Clay and Karen ask in that book to help guide my own thinking. What “job” do your customers hire you to do? The answer to that when I was managing partner was focused entirely on how we best serve our clients and our Banyan people. But now I have extended that question to my life. I want to focus my energy and time on my three most important “customers”, which are first my family, second my clients (and I still look forward to years of great work with them.) I’m still searching for a third “customer” to focus my attention on—perhaps a new interest or passion (ideas welcome!)

But to do this well, I need to understand the job each of these customers are hiring me to do. This is all a necessary part of the psychological transition that has helped me handle our succession process well, both for the firm and for myself. Now I must turn my attention to that new set of “customers” where I can have the most impact at this stage of my career. I don’t want to fritter away that opportunity worrying about what I wish I could still control or fretting about how I might have made a different decision or focused on different priorities. This time is too precious.

As I officially hand over the reins, I emerged with a deeper empathy for the senior generation at the family businesses we have advised over the years. It isn’t easy to let go of what you love so much. But letting go is the only way you can make the most of what may be the most important phase of your career. The one in which you can leave a lasting impact on the people you care most about.