Creating a Strategic Plan for Growth Before focusing on succession, develop a strategic plan for growing the company.

Family businesses often think of strategic planning as succession planning. But the two are very different: If you don't know where your company is going, how do you know who should lead it there? That's why Paul Karofsky, director of Northeastern University's Center for Family Business in Dedham, Massachusetts, contends that before a family business focuses its attention on the issue of succession, it should concentrate on developing a strategic plan for growing the company.

Just the words "strategic planning" are enough to raise skepticism in family business founders who see the process as a threat. It implies change and communication, two concepts entrepreneurs are not generally known for initiating or accepting easily. So a catalyst, such as the transfer of leadership from one generation to the next or the professionalization of the business by hiring nonfamily managers, is often needed to prompt a re-examination of the marketplace and the goals of the family and company.

That's what happened at Spag's, Shrewsbury, Massachusetts' 64-year-old discount store, which sells everything from candlesticks and paper towels to Barbie dolls and name-brand clothes.