Succession Planning and Management Blog

GEN Y workers are the least satisfied with their jobs and are more likely to quit for something better, a national survey has found.

Four out of every 10 employees surveyed said they were seriously considering leaving their current position, but that figure jumped to more than half in the 25 to 34 age group.

Neither pay nor the boss are to blame for the dissatisfaction, however, with younger workers reporting more favourably on the way they are treated by their employer and whether they are paid fairly, compared to their older colleagues. Instead, it is the nature of the job they are doing that fans the discontent.

By contrast, older workers are more satisfied with the work they do but report higher levels of discontent over career development opportunities and salary.

Overall, however, the workforce is happier than it was eight years ago when human resources consultancy company Mercer conducted its last What’s Working survey of 1000 Australian employees – part of a 17-country survey with 30,000 participants. Yet in 2003, only 25 per cent of workers said they were seriously considering quitting their job, compared to 40 per cent in 2011.

Marian Baird, professor of employment relations at the University of Sydney Business School, said the Mercer survey’s findings appeared contradictory, but were credible and indicative of constrained financial times.

Intention to quit does not necessarily translate to an employee actually quitting, she said, and in the case of younger people, the desire to quit was partly due to a natural urge for change and the increasing expectation that younger workers will pursue multiple career paths during their working lives.

”But we have also brought Gen Y up not to believe in a job for life,” she said.

”Now they are acting on it.”

Read more: http://www.smh.com.au/executive-style/management/restless-generation-lacks-job-satisfaction-20110912-1k64b.html#ixzz1XogAt4Cd

72 % do not have a documented buy / sell agreement – this manages the ownership of equity if someone is “hit by a bus ”
82.5 % have not set a date for transfer of leadership and control to next generation.
53.5 % of owner managers of family businesses intend to keep the business “small”

Apple announced this week that Steve Jobs had resigned as CEO. Steve Jobs is the creative genius behind the technology company and it’s public face. The announcement seemed to catch many off guard. The media is speculating about what will happen to Apple’s stock and the company’s future. Fortunately, the company had a plan in place.

In its announcement, Apple stated that “Jobs submitted his resignation to the Board today and strongly recommended that the Board implement its succession plan and name Tim Cook as CEO.” That is exactly what the Board did and Mr. Cook is now the CEO of Apple. What is important to note is that Apple had a succession plan in place in the event that Mr. Jobs died, resigned or could no longer serve as CEO. Unfortunately, many companies do not have a succession plan in place. Not having such a plan in place can lead to disastrous results, including the failure of a business

Only a reasonably small number of respondents to the 2011 Family Business Survey planned to hand on their business to the next generation – many will shortly find how difficult the succession process can be to implement – respondents were asked to rank a range of matters in terms of their likely effect on the succession process both from within and outside the family.

The research shows the big four succession issues are:
• the ability to generate adequate financial returns
• the financial capacity to retire
• trust in the abilities of the potential successor
• potential successors’ interest in the business

Interestingly, we have previously discussed the effect of the GFC and anecdotally have seen business owners hold off on an exit plan which might have been undertaken over the last three years – 29% of survey respondents listed the impact of the recent downturn as having a negative effect on the succession process.

Having reviewed the potential complexities it was not surprising that many respondents appeared to have avoided formal succession planning:

Yes Work in Progress No

Management 26 30.5 43.5
Control 23.5 28 48.5
Ownership 28.5 25.5 46

A LATE twist in the bidding war for the accounting software provider MYOB has led to the US private equity fund Bain Capital prevailing in a $1.2 billion deal. A competitor, the British-listed software provider Sage Group, had been leading a pack of rival bidders – including private equity giants Kohlberg Kravis & Roberts and Hellman & Friedman – with a $1.35 billion offer.

It is understood Sage’s bid fell through late last week after falls in its share price – hammered by the broad sharemarket selloff in Europe – meant the value of the MYOB transaction would now exceed 25 per cent of Sage’s market capitalisation. The deal would have required the lengthy and uncertain process of a shareholder vote, which prompted MYOB’s owner, Archer Capital, to look elsewhere and accept a bid worth 10 per cent less.

It is still a hugely profitable deal for Archer. The acquisitive private equity fund bought MYOB in February 2009 for about $500 million, and then boosted earnings by stripping out costs, raising prices and aggressively growing its customer base. ”We doubled the profitability. We basically achieved the three or four things we set ourselves before we acquired it … and we had a lot of inquiry from potential buyers,” an Archer partner, Peter Wiggs, said, explaining the rationale for the sale.

The deal is understood to have been valued at a multiple of 11.3 times earnings before interest, tax, depreciation and amortisation. MYOB is used by more than 1 million small- to medium-sized enterprises in Australia and New Zealand.

Read more: http://www.smh.com.au/business/archer-takes-12b-for-myob-20110821-1j4pf.html#ixzz1VhQMXDGK