Running your business is hard work, and no one knows that better than you! There’s no denying that most successful business owners became successful because they stayed focused and kept their eye on the ball. It is not difficult to appreciate how little time you have, if any, to think about, plan for, and document the changes in your business you are willing to initiate and those changes your business will inevitably experience. The old adage of “life is what happens when you’re making other plans” surely applies in this case-no one likes to discuss their own mortality.
Succession planning should not be a distraction, it should be another component of protecting and strengthening the legacy you have built. The process of succession planning is designed to address the business necessities required to maintain the health of the entity, while the owner is still leading, and then again when he or she is not. Not only can succession planning increase engagement across the organization, but it ensures the company does not miss a beat if a key employee leaves for any reason. In the long run, the company will be better for putting a succession plan in place.
Succession planning DOES NOT mean you are giving up control of your company. Maintaining control of your company and transitioning the ownership to the next generation to achieve tax savings, reduce risk, and maintain the value of the business takes foresight and planning. Everyone from the boardroom to the shop floor is impacted by decisions made, so it is critical that the process is afforded the proper time and attention to detail.
As the planning process advances, it is important to recognize that what has worked well for the company in the past may not be best going forward. Identifying the potential leader(s) who might be in the organization today should not be based simply on seniority or longevity. Filling critical business leadership roles with internal successors may be an easy answer, and the least risky option, but is not always the best choice. Many companies prepare for succession by seeking out new and experienced senior-level talent, who can bring fresh ideas, renewed energy, and foresight to the business. Sometimes a new set of eyes can take the business further than ever expected.
Having an experienced and unbiased external facilitator quarterbacking the succession planning process, and holding all the internal and external stakeholders accountable, is a proven approach. A facilitator managing a carefully-designed step-by-step process helps keep everyone aligned and provides benchmarks to gauge forward progress and illuminate impediments. Insyte can help, for information please contact one of our Business Development Managers at 716 636-3626. Reimbursement based financial assistance grants may be available, on a situational basis, for Succession Planning projects.
An Owner’s Guide to Business Succession Planning 2nd Edition, Stephen Clifford & The Staff of the Ohio Employee Ownership Center