Many business owners don’t think much about how a transfer of leadership will occur if they retire or if something happens to them that makes them unable to perform their leadership duties. While it might not be a pleasant thought, getting a succession plan together is a critical task that can’t be put off.
A succession plan is a proactive strategy that clearly outlines what should happen once it’s enacted. This must be done in a clear and legally compliant manner.
Succession planning is multifaceted
The primary goal of a succession plan is to ensure continuity of business operations. One of the first things that has to happen in the succession planning process is determining the key players, such as the owners and executives, who need to be included. After those individuals are identified, plans can be made to cover the roles or transition others into the roles if the current individuals aren’t able to perform their duties.
The succession plan should also include actionable steps that can be taken while the company is in its current state. This includes cross-training individuals who may be asked to shift their roles or absorb new duties once the plan is enacted.
Succession planning can shift as necessary
Succession planning will shift with changes in the company. For example, if a company goes through restructuring or adds new executive positions, the succession plan may need to change with it.
Succession planning is critical for all adults who own a business. Taking the time to set the plan can be beneficial so they can ensure that the documents and terms are set properly. Because this isn’t a one-and-done event, setting reminders to review things periodically is critical so the business can continue to thrive.