An often-overlooked tenant and responsibility of management is the development of a successors(s). Very few small business owners, corporate managers or even boards give enough attention and resources to the subject of succession. This is evidenced by the many requests for help we receive in our offices:
Each of the above scenarios could have been prevented through proper planning. As Ben Franklin said, "an ounce of prevention is worth a pound of cure”. This article will address the planning process that should be considered when planning for retirement and preparing a successor. We refer to this planning process as “succession planning”.
Succession planning is a strategic process for identifying, developing, and preparing new leaders to assume the management of an organization. Unlike “replacement planning” which answers the question “who could keep this place going if (name) was hit by a bus”, succession planning focuses on identifying and developing the skills and competencies that someone leading an organization should possess. It is a planning and developmental process in which talented individuals are groomed and prepared for the future.
The six key steps in succession planning are as follows:
In summary, each of us as leaders has the responsibility to plan and prepare for the future, rather than just focusing on today. By planning for your own retirement or the retirement of those in your organization, you can ensure the continuity of your organization and help to eliminate organization and financial risk.
Jeff Ketchum is a 25-year entrepreneur and owner of 5 businesses including, Lordstone Business Advisors, Inc., and Lordstone Corporation. As a certified small business Growth-Drive Specialist and ValueBuilder Advisor, Jeff helps business owners who want to increase the value of their businesses. Jeff can be contacted at (906) 428-9330.
P.O. Box 469
Gladstone, Michigan 49837
+1 (906) 428 9330
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