Business Succession Planning
Whether you’re a family business owner considering retirement or an entrepreneurial management group hoping to sell, the key to a successful transition is early and continual planning. Not only will it establish clear direction and expectations for the future transition, it can also help improve business practices and protect the value of your business today.
Tips for developing a solid business succession plan:
Involve your staff.
When you engage your employees in the succession planning process, you establish a sense of responsibility and ownership. This can help boost morale and spur staff members to renew their commitment to the company.
Consult the experts.
Make sure you work with a reputable attorney, financial planner and tax professional to help you examine ownership, valuation, and tax issues with an objective eye.
Find tomorrow’s leaders.
The future of your company depends on the strength of your leadership. Identify those with the skills and attitude that will help the company grow, then groom them for leadership positions.
Don’t forget your values.
As you develop your succession plan, make sure it’s in line with the company’s core values, key competencies and positions, and performance goals.
Developing a succession plan will force you to review all of your current business functions carefully. Doing so will quickly reveal current staff, skill set, and technology weaknesses. Correct those now. You’ll likely improve the bottom line today and preserve it for the transition.
Ensure continuity of talent.
If your staff, on the whole, is aging and nearing retirement, you’ll need to implement a plan to develop new talent to ensure the skills necessary for smooth transition and successful operations after you’re gone.
Define your role.
Will you hang around after new leadership takes over? Will you continue to draw a salary? What will your compensation package look like? The answers to each of these questions will have a direct impact on future operations, so take time to define your role now.
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