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TORONTO, ONTARIO--(Marketwire - April 3, 2012) - BMO Financial Group's James Wong, Vice President of Succession Planning, has co-authored a new book, The Transition Experience: What every Canadian family business owner should know beyond succession planning. The book identifies the four most common mistakes Canadian small business owners make in business succession planning.

"When starting the process of succession planning, certain elements will always play a big role, including emotions, time constraints and conflict between family members," said Mr. Wong. "If handled correctly, the act of transitioning your business can be a successful and seamless process that works out well for everyone involved."

According to a BMO study, the majority of Canadian small business owners have not yet prepared a succession plan, with almost half stating that it is too early even to begin thinking about it.

"Given that small businesses account for almost 97 per cent of all employers in the country, not having a proper succession plan could have major implications for the Canadian economy," said Cathy Pin, Vice President, Commercial Banking, BMO Bank of Montreal. "The good news is that financial advice and expertise is available, and a smooth transition is achievable when a well thought-out succession plan is developed and followed over a period of time."

Avoid the four most common succession planning mistakes:

Underestimating Time: Many families who are undergoing succession planning often underestimate the amount of time required to create a comprehensive plan. It is prudent to allow for ample time to prepare, evaluate, strategize and ultimately execute a succession plan that meets personal and business objectives. The consequences of inadequate planning can negatively impact the business. Ideally, plans should be put in place five years in advance, three years at minimum.

Not Communicating Enough: Lack of communication is often the root cause of stressful challenges in succession planning, including differences in opinions and objectives among family members regarding the family business. Having open and honest communication between family members is essential; the establishment of formal communication policies, like holding regular family business meetings, can be particularly useful.

Avoiding Conflict: Fear of conflict, and trying to avoid it, can often be a major impediment to successful succession planning. When making changes to a succession plan, it is only natural that tension and conflict can develop among family members. It is important to understand that conflict is inevitable; instead of avoiding it, business owners should learn how to manage it. If managed well, conflict can lead to very positive outcomes.

A Lack of Balance: Lack of balance in a succession plan - between family and business - can often present a challenge. Emotional issues and family conflict often cause business owners to procrastinate in succession planning. The preservation of harmony before, during and after the transfer of leadership is important to the long-term well-being of a family.

To order a free copy of the book, please visit: www.bmo.com/succession/

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