As an entrepreneur, there are multiple demands on your time and matters that require prioritizing. But while you're juggling strategic planning decisions for your business, don't forget about one of the most important factors of its long-term success—succession planning.
Planning for your company's legacy can not only help you shape your business's future after your departure, but it can also strengthen your company today. Here we discuss three key factors a solid succession plan should include.
Both Short- and Long-Term Strategies
Succession isn't just for retirement—the best succession plans will have one prong for short-term emergencies and another prong for long-term shifts in leadership. Both prongs should clearly set out things like:
- When the succession plan kicks in
- Whenever you're ill or unavailable?
- When you've officially taken a leave of absence?
- When you've announced your retirement?
- Who is in charge of key aspects of the business while the plan is active
- For short-term succession plans, there should also be a clear signal for when the plan ends
You also don't want to create a succession plan in a vacuum. Ask for feedback from trusted advisors both inside and outside your business. This may also be a good time to cultivate new ideas from your employees and partners—is there anything you should be doing differently?
A Designated Successor
The successor you choose can make or break your succession plan. When deciding who is the best choice for the role, consider what attributes and philosophies are most important. Do you want someone who runs the company in the exact same way you do? Or are you looking for someone who shares your general vision but has their own plan for achieving it? How will your choice of successor impact the culture and atmosphere of your company?
Once you've chosen your successor, it's time to cultivate them into the leader you envision. Ask them to work closely with you to prepare them for what to expect from the role once the time comes. Open up your decision-making processes to give them insight into the factors you consider when steering your company, or allow them to start taking on minor parts of your role to get them used to taking charge in your stead.
A Strong Management Team
While your successor holds a great deal of responsibility for steering your company forward, your management team also plays a key role in maintaining your company culture and keeping the business on strong footing in your absence. Succession planning involves investing in the next generation of business management, whether through a dedicated mentorship program, continuing education, or other targeted mentorship opportunities.
Succession Can Determine Your Company's Success
Don't let all your hard work building your business go to waste—without a succession plan, your dedicated employees could find themselves scrambling if the worst were to happen. By investing in succession planning, you can allow your company to continue to prosper no matter who is in charge on any given day.