As originally published by Financial Advisor magazine.

It’s ultra-complicated. There is lots to think about and there are lots of processes involved. You have to calculate your exact trajectory, adjusting for the fact that you are in motion while relying on an imprecise instrument to measure the distance to your destination. You also have to worry about the weight hitting the ground and the density of the landing spot.

While all of this is going on, you must synchronize all the other moving parts, each with its own trajectory that could throw off your balance if ignored.

It’s complicated. But we do it all the time. It's called taking a step.

Sometimes things work best when you don’t overanalyze them and simply put one foot in front of the other.

The same is true for the succession process—even if the overall process is very complex, sometimes all business leaders need to do is take the next step. I’m not suggesting that preparing for succession is a waste of time and you are better off just winging it and hoping for the best. That would be irresponsible advice. But letting your firm be paralyzed by the inability to perfectly plan for the future can be just as destructive.

In our G2 Leadership Institute, a leadership development program that focuses on next-generation professionals, we have worked with close to 250 young leaders and their mentors (most of whom are firm founders). In this work, I often hear things like this:

Mentors tell me: “I am 52 years old, and while I have a few years left, I worry a lot about succession.”

A few years? Bernard Hopkins was still boxing for world titles at 52. But I see how founders feel under pressure. “I am still going strong and have no intention of hanging it up anytime soon,” they tell me, “but my partners keep asking me when I plan on retiring.”

It’s not just founders obsessing about the succession problem. I frequently see younger advisors spending an extraordinary amount of time creating spreadsheets showing how their firm’s equity will evolve over the next 30 years. Rather than alleviating their fears, the modeling makes them ever more frustrated.

Perhaps this is to be expected. After all, our industry is all about helping clients plan their retirements and perpetuate their wealth for many generations to come, so we are used to thinking about plans in terms of decades. However, in the case of succession, plans that stretch into the distant future may not bring much clarity. In fact, they may work against you, killing your willingness and ability to act. So I would like to offer founders and next-generation advisors some advice on how to overcome the paralysis of succession anxiety disorder and start learning how to walk again.

Watch the Mile Markers, Not the Finish Line

This is advice any marathon runner would recognize: Focus on the mile ahead. If you keep thinking about the total journey to the finish line—26.2 miles!—you will quickly be overwhelmed by the massive scope of what you are undertaking. But if you just run the next mile, it usually works out—more than 98% of those who start a marathon finish it.

Both the next-generation advisors (G2s) and the founders should be asking themselves this question about business planning: “What is the next step for us as a firm, and does that step change depending on our succession plans?” The answer to the first question depends on the firm, but more often than not, the answer to the second part is “not really.”

For most firms, the steps for success are straightforward: Grow the firm, hire good people, develop those people, manage your client relationships and put your best people in leadership (and perhaps ownership) positions. Succession often does not have a drastic impact on those strategic initiatives, so don’t let the details (or lack thereof) of your succession plan derail you, take your eye off those fundamentals or keep you from continuing to move the firm forward.

That said, if you are approaching a point where you are in danger, then it is time to act. How do you know if you are? Maintain an active dialogue with your stakeholders. They can point out obstacles in the course that you may not have seen coming. More on that next.

Consider All Stakeholders in Your Decision

If you are the founder of an advisory firm, remember that you have a responsibility to three core groups of stakeholders: 1) the clients of the firm, 2) the other owners (i.e., your partners) and 3) the team. Ideally, the future direction of the firm meets the goals of all of them. You should never sacrifice the needs of one group to appease another.

Founders often assume that they know everybody’s goals and desires without actually consulting with them. Or more accurately, they know the answer stakeholders would prefer before introducing the constraints of reality.

Airlines understand this phenomenon well. When consumers are asked questions such as “Would you like better food on the flight?” or “Would you like more options for in-flight entertainment?” they tend to respond with an enthusiastic “Yes!” However, when the questions are rephrased to include the trade-offs, responses change dramatically. “Would you pay more for a ticket if we had better movies?” Well, when you put it like that, “Heck, no!”

Similarly, founders may think they know what employees want without making the realities clear. They often avoid admitting that there really aren’t many alternatives for future ownership and create the perception that the situation will somehow work out. This does not help the younger team members. It just creates anxiety.

Independence Is in the Eye of the Beholder

And let’s not forget about the clients. What do they want? Everyone seems to believe they are best served by an “independent” firm, but few people bother to define what that means or ask how clients might understand it.

Which means we rarely ask them to weigh in on the trade-offs. “Would you be OK if we are not able to hire and retain the best people to work with you, but in return we remain independent?” How important is independence to them in that case?

Much like beauty, independence is in the eye of the beholder when we’re talking about succession questions. Some may look upon a boat sailing the seas as a symbol of freedom to roam the vast possibilities of the horizon. Others may see a tiny object floating in a vast and unpredictable ocean, prisoner to the whims of the waves and the winds. Independence is not just the absence of restrictions. It requires the ability and the will to make decisions and then act on them. Without that ability and will, independence isn’t much different from ineptitude.

Forty-five percent of advisory firms with more than $1 billion in assets under management said that they have an institutional investor, at least those who participated in the “2020 Study of Pricing & Profitability” developed by the Ensemble Practice LLC and published by Investment News. The ownership stake of institutional investors is very close to 50%. So if half of the firms are half-owned by an institution, what exactly is independence?

I actually don’t have an answer to this question. Perhaps it is something that every firm must decide for itself: “Who are we? What does independence mean to us as owners? To our clients? To our team?” Being dogmatic does not work. Starving to death on a chicken farm because we are vegan is not a workable solution. On the other hand, ignoring reality isn’t a great look, either. We can’t just pretend brussels sprouts with bacon is a vegan dish because bacon is a minority “partner.”

G2s, Be Honest about Buying (or Not Buying) Equity

Time and again, I observe G2s who are reluctant to buy ownership in their firms. There seem to be two main reasons for this. First, they worry that it is already very expensive (which is, of course, a legitimate concern). Second, they are not sure what will happen to their firms and are nervous to make the leap to ownership. If you are a member of G2 and considering ownership, and if concerns such as these have been holding you back from making a decision, remember that there are really only two options here. Either you buy the equity or an external investor will.

No young professional should feel forced into buying equity. And you shouldn’t buy equity for the wrong reasons. You should instead buy because you are excited to be an owner in a good firm. You should buy because you want to grow the business together with your partners. These are good reasons.

If you don’t have reasons like these, or if you are having trouble thinking of any reasons at all, then ownership is likely not for you. Perhaps this firm is not for you.

Accept That This May Not Be (and Perhaps Should Not Be) Your Job for Life

I find it interesting how the majority of professionals in our industry assume that they will spend the rest of their careers at their current firms. This is a stark difference from other industries, where the standard career advice is that talented people should change jobs every three to five years. Studies suggest that employees who stay in the same job for more than two years are paid up to 50% less than new hires.

While long commitments might be good for the company cultures—creating comfort, relationships, knowledge, trust—they can also create some toxicity. For starters, the firms face enormous and perhaps unfair pressure to live up to the expectation of being lifetime employers, and that can create desperation and anxiety among employers and employees.

If you are a very good advisor, you are in high demand and desired by other firms in your market. So don’t limit yourself by adopting a mindset that your current firm is the only option. When you take vacation with your family and don’t like the resort, you simply go to another one next year. You don’t go back to the same place that disappointed you, sit in the bar and sulk over a drink while complaining about how management refuses to retire.

There is great freedom in the realization that you can leave. What’s more, making a change may expose you to new skills, new mentors, new clients and new levels of compensation and perspective on the industry.

It’s no wonder advisor compensation has not changed over the last five years despite a booming market for the equity of advisory firms. Keep begging to stay at the same resort, and you’re not likely to get a better deal.

Don’t Fear Succession

Equity transactions change a firm. Their impact is felt in every corner of the business, from culture and employment practices to technology and marketing to compensation and benefits. Here is the thing, though. In my experience, an equity transaction has never turned a bad firm good. Likewise, it’s not going to ruin a good firm. The best managed firms in the industry remain that way after they take external investments.

In conclusion, let’s move beyond our succession anxiety and take it step by step. I sometimes wish that firms wouldn’t obsess so much over this planning, and instead spend the energy on creating growth and new opportunities and training their people. As long as you continue to grow at a steady pace and keep adding younger advisors who are excited to be there, I can’t see how or why the future should scare you.