Your succession plan looks perfect, but only 51% of the next generation knows it exists

If your successor learns the plan the day you leave, you have no plan. Name the critical roles, assess who is ready, tell them, and hand over while you can still correct the choice.

The benchmark: what a large buyer expects of its suppliers

In November 2020 Marks & Spencer published Systems for Success, a reference guide for the companies that supply its food. Many of those suppliers are family firms. Its talent management chapter grades a supplier on four levels. At the third level it expects a "process to identify workers with potential to progress", and it adds that the process "is well communicated". At the fourth, "'Grow your own' and 'Grow your successor' are embedded" and most roles are filled from inside.

Three lines in that standard carry most of the weight: potential is found by a process rather than by the owner's instinct; the people involved know the process exists; and successors are grown before the seat is empty. The two companies in this case show what happens on each side of those lines.

Harischandra Mills: three handovers and no plan

C. A. Harischandra founded the company in Matara, Sri Lanka, in 1943 as a rice mill. It now makes and distributes noodles, coffee, flours and soaps, has been listed on the Colombo Stock Exchange since 1983, and had 935 employees at the end of 2016. It is in its third generation. A case study published in IJRISS in January 2021 by C. H. Wijayasinghe, written with the managing director's permission, sets 34 years of annual-report figures against the company's leadership changes.

The founder had four daughters and no son in the business, and he spent his attention on running the company rather than preparing someone to run it. When he died in 1985 there was no successor ready. His widow, Cornelia Harischandra, ran the company until her own death in 1989. A non-family chairman then led the board until 2005, and the founder's grandson has been managing director since 2000. The author's conclusion is direct: "Most of the succession gaps were followed with the performance failures of the business." The current managing director, the paper adds, "has no clear view on future successors and no plans set so far to develop potential successors."

Cris-Tim: a handover made while the founder was still there

Radu and Cristina Timiș opened Cris-Tim in 1992 as a shop of ten square metres. It grew into the largest family-owned company in Romania's meat industry, making and distributing cured meats and ready meals. Its first attempt to bring in outside leaders failed. In 2009 the founder dismissed a second executive team within two months, saying "they did not share the vision, the ideas, the pace and style" of the company, and the two founders took the operation back.

The next handover went to the family, and it was made while the founder was alive and active. At the end of October 2019 Radu Timiș Jr. became chief executive, and his father stepped down to remain involved as a strategist. The sons had to earn the role. "If you don't earn trust, you can't get into the family business," Radu Timiș Jr. told a Revista Biz panel in November 2024, adding: "We operate purely on merit."

Romania: a first-generation economy that runs succession on trust

Most Romanian family companies have never passed from one generation to the next, as PwC Romania notes. In Central and Eastern Europe, 64% of family businesses are still led by their first generation, against 32% worldwide, according to PwC's 2024 CEE NextGen survey, citing its 2023 family business survey. PwC Romania's Mihai Anița put it plainly: Romania's family business ecosystem "is still young, having been founded less than 35 years ago" (Economedia, translated). An earlier EY barometer found that only one in five Romanian family firms with revenue above €1 million had reached the second generation. That survey dates from 2017, so treat the figure as directional.

The headline number comes from the people who are meant to take over. Of 179 next-generation family members surveyed across the region, only 51% know a succession plan exists in their family's business. Another 41% say there is no plan, and 8% do not know. PwC adds that 15% were not involved in drawing up the plan.

Where Romanian companies do plan, they plan on trust. PwC's 2023 survey concluded that succession in Romania rests "rather on the base of trust than formal rules" (Romania Insider). Romanian family firms have fewer written rules than their peers: 39% have a shareholder agreement and 12% a will, according to the PwC Romania report and its coverage.

The mistakes we see repeated

Put these sources side by side and the same six mistakes come up: in the PwC and EY surveys, in EY Romania's 2026 analysis in Capital, and in the two cases above. In the 2017 EY barometer the owners kept succession to themselves in 78% of Romanian firms, against 5% where the board held it; PwC found 30% of Romanian family boards are family-only.

• The plan lives in the founder's head

  Succession rests on trust rather than written rules, and only 12% of Romanian family firms have a will.

• The successor is the last to know

  Half of the next generation knows of no plan, and some who do were never asked to help shape it.

• The handover waits for a crisis

  A death or an illness forces the change, as it did twice at Harischandra, when nobody has been prepared.

• The owner decides alone

  No board or outside voice tests the choice, so it is never challenged before it is made.

• Birth stands in for readiness

  Being the founder's child is treated as a qualification instead of a starting point to be tested.

• Tax and legal transfer come last

  Shares, property and wills are left until the handover, when the estate is most exposed.

The FAN Courier example points to a cost the surveys miss. When the next generation arrives without an explained plan, managers fill the silence with their own reading of what it means for them.

What a working plan looks like

The method is well documented, and it is the same whether the successor is a daughter, a son or a hired chief executive. The CIPD defines succession planning as "identifying and growing talent to fill business-critical positions in the future", and says transparency is key to how potential successors are judged. The University of California's workforce plan shows the larger cycle: set the direction, compare the skills you have with the skills you will need, act on the gaps, and review every year.

1. Start from the strategy. Decide what the company must be able to do in five to ten years, then which leaders that will take (Korn Ferry).
2. Name the critical roles. Rate each role on its impact, how scarce its skills are and how hard it would be to fill. This is the work of our Role-to-Value Alignment.
3. Assess who could fill them, on evidence. Keep performance and potential separate and rate readiness: ready now, in one to two years, or in three to five. Aim for at least two named successors per critical role (Chronus). Korn Ferry's advice is "Don't default to favorites". This is the work of our Talent Mapping.
4. Tell them, and agree a development plan. Confirm the person wants the role before naming them (Atlassian), and give them real responsibility to prove it, as Cris-Tim did.
5. Hand over while you are still there. Set a date, keep the outgoing leader as an adviser with a defined role, and give the board the final review.
6. Review it every year. Review the plan alongside the strategy, track how many critical roles have a ready successor, and update it after any resignation or reorganisation. Our HR Strategy Advisory ties these steps into one plan the board owns.

A plan the successor has never seen is a wish, not a plan.

• List the critical roles

  Write down the few roles the company could not run without for three months.

• Rate readiness on evidence

  Assess two candidates per role and give each a readiness date.

• Tell them and the board

  Agree development plans with the successors and a review date with the board.

Before and after: the cost of an unplanned handover

The case's measured result is a cost, not a gain. At Harischandra Mills, return on equity fell from 31.9% to 4.9% in the year the founder died, and from 19.03% to 7.14% in the year his widow died, both times with no one prepared to take over.

Both figures come from the company's annual reports as published in the IJRISS case study. We have not audited them.