Do You Have a Succession Plan in Place for Essential Leaders?

Every business should have a succession plan and exit strategy to prepare for the owner/leader’s retirement, sale of the company, or changes in key management positions. The importance of a business succession plan is especially important during the Great Resignation. Business leaders and business owners should consider: Who would replace critical people on your staff? Who would take over the business if the owner or a key member of the business retires, becomes ill, or dies? These questions need to be asked now to avoid a crisis later.

There are ways to plan for this and prepare your business for these types of transitions. Starting early is the key when it comes to business succession. This gives you more time to find suitable candidates, provide crucial training and professional development, and ensure your business is not adversely affected by unexpected changes in leadership.

Business Succession Plans Are Crucial to Your Business’s Achievement

Even the most thriving business can be thrown off course by changes in leadership. Instituting a dynamic business succession plan now helps ensure that your business will meet its short-term and long-term objectives. Here are some steps your business can take toward succession planning:

• Start your plan early – Do not wait until you are caught off guard by the departure of a key executive or an unforeseen event. Being prepared well in advance gives each team member a chance to understand their role.
• Find suitable candidates for succession – Make sure those who will be called upon to step up if the need arises are ready.
• Inform the potential candidates – You should inform those who stand to gain responsibility about the opportunity for advancement. However, you may want to stress that nothing is guaranteed.
• Provide training and professional development – It is essential to give your candidates the skills and experience necessary to be ready. You can even allow employees to assume responsibilities for a higher-level role during an executive’s vacation or other absence. That will enable you to identify if there is a need for more development and training.
• Keep succession in mind while hiring – As you are hiring for new or existing positions, you can consider the potential gaps in leadership or succession during the hiring process.
• Identify your own replacement – When it comes time for you to retire or sell the business, you will want to ensure that your business will enjoy continued success in your absence. It is essential for a business owner or manager to have a hand in choosing their successor. Unfortunately, unexpected illnesses and accidents happen all the time, so it is important to have a business succession plan in place even if you do not plan to retire for some time.

Besides the immediate need to prepare for top leadership changes, succession planning also allows you to adapt to changing demographics and talent scarcity. The business succession planning process can help identify gaps and training needs in your staff as well as areas for improvement. Business succession planning can also boost team member morale and employee retention rates.

Contact Our DuPage County Business Succession Planning Attorneys

Having a dedicated business attorney to help you with succession planning is an important step to make sure you know all your options, learn the best ways to put key systems in place, and more. At Gierach Law Firm, our Naperville business lawyers are committed to helping you build your business and keep it running no matter the circumstances. To discuss succession planning for your business or any other business law or estate planning needs, contact our business succession planning attorneys or call 630-756-1160.

Sources:

Society for Human Resource Management

Robert Half