Why All Businesses Need to Plan for Succession
Imagine if you were suddenly unable to run your business tomorrow. How smoothly would things continue for your operations and those who depend on them? We share why a business succession plan is important to your overall business strategy.
Securing Your Business’s Future
Succession planning isn’t just about retirement. In the event of an unforeseen circumstance, would your business’s operation, management, and value be compromised?
Succession planning is critical even if you’re planning to retire in 20 years or have already chosen your successor. In case of an unexpected event, this preparation can turn a significant crisis into a manageable situation with a business succession plan.
Ensuring Operational Efficiency
By having these conversations now and documenting clear intentions, you can save yourself, your stakeholders, and your family from significant stress and uncertainty.
Planning for unexpected scenarios requires you to evaluate who does what, why, and how they do it best:
- Is the right person performing the task?
- Is their process the most efficient way to do the job?
- If multiple people perform the task, are they doing so consistently?
- Have we defined and documented the best process?
- Should this task be the responsibility of a single team member?
Documenting key business processes in your company allows you to devise the most efficient system for each task. Clear procedures are helpful when a team member is absent and crucial when transferring knowledge to a new team member, manager, or owner.
Developing a Robust Succession Plan
A robust and effective succession plan takes three to five years from initial planning to implementation. However, any plan is better than no plan. Generally, the longer you have to execute your plan, the more you can maximise the value of your business and the capital you extract upon exiting.
A succession plan is not something to write and forget. It is an integral part of your business strategy that requires regular attention and ongoing development. Involving key team members in aspects of planning will engage and empower them as the journey begins.
Need help developing your succession plan? Get in touch!
