Business owners are going to face a problem in the coming years. As baby boomers continue to retire at increasing rates, more people are leaving the workforce than those who are entering it. For this reason, among others, business owners need to start succession planning now to ensure the success of their company in the years to come.
Succession planning is not easy for many business owners, as it is not easy to think about one’s own demise, particularly when that means leaving a company they have built from the ground up. However, it is crucial that all business owners face this reality and actively plan for it. At Beth Santilli Law, LLC, our experienced business attorneys can assist you through the process of business succession planning.
What is Succession Planning?
In its simplest form, succession planning is planning for the execution of smooth transitions of leadership positions within a business. Although simple in concept, succession planning involves many steps, including:
– Recruiting new talent
– Performing selection assessments
– Integrating a new leader
– Creating a plan to bring the new leader in while the previous leader prepares to leave
Why is it Important?
Succession planning for business owners is a sensitive matter, and the process poses a unique set of challenges. Still, it is crucial that business owners persevere to ensure that they have a comprehensive plan that includes the right people with the right skills, experiences, and capabilities to manage the business effectively. With the shortage of employees in the market, finding the right talent will not be easy for any business, which is why it is so important to create a succession plan now.
It is also important for businesses to remember that searching for qualified executives is crucial—and difficult. To avoid associated expenses with this process, business leaders can work to develop the top talent they currently have and make sure that those individuals have the necessary experiences to prepare them for the future. This can drastically reduce recruiting costs by allowing businesses to source new leaders from their in-house team.
Key Factors to Consider
In any succession plan, there are a number of factors to consider. The most important of these include:
– Determine what is most important to the company
– Remain fair and transparent with all employees
– Be proactive and begin succession planning now
– Consider what the future holds for the company, such as how advancing technology will affect it
– Create a contingency plan in case the first plan does not work out
– Get creative with options, as there are likely many possibilities
While these factors must be considered in any succession plan, there are also ways business owners can tailor their succession plan to their specific company.
Tailor Your Succession Plan to Your Business
The best way to tailor your succession plan to your business is to be mindful of your company’s internal culture. If your company thrives on pushing boundaries and investing in edgy solutions, then planning for a risk-adverse leader to take over probably will not work. You should determine the necessary skills the new leader must have, assess your current talent pool for those skills, and help develop the new leader based on skill set and potential, all the while keeping your company’s vision top of mind.
Get Legal Help Today
When you need help planning for the future of your company, our experienced business attorneys at Beth Santilli Law, LLC are here to assist you. We are ready to help your leadership plan for success and ensure that your company embodies the legacy you have always envisioned. If you have not yet started creating a plan for succession, contact us today to learn more about how we can help.