Regardless of whether business owners or CEOs are approaching retirement age or have many years left in their careers, creating a succession plan for their business can never come too soon. Unexpected events can happen at any time, and a succession plan helps a company avoid chaos and confusion that can happen when change occurs suddenly.
The critical considerations for any succession plan are: Who will you choose to take over? And how will you best prepare them for their new role? Those questions may sound simple, but they could be the most important ones you can ask for your company.
Five tips for succession planning
Depending upon your company’s structure, you may be the sole decision-maker or the most important advisor for your company’s board. To begin the process:
- Search early for a new CEO: If possible, starting a search for your replacement years early is a good idea. Top candidates get other offers, decide on a new course for their lives or retire.
- Consider in-house candidates: Depending upon your company’s timeline, think about potential successors at different levels of the company and cross-train them for possible advancement. Once it becomes clear the type of leader you need, they may already be in your organization.
- Think culture rather than skills: CEOs set the tone for a company’s culture and the type of leadership they want for their team. If you wish to keep the current culture intact, an in-house candidate may be the solid choice, but if a change is needed, an external candidate may be the best fit.
- Share your experience: Once you’ve made your choice, it’s time to pass along the lessons you’ve learned during your time as CEO. Avoid paperwork dumps, if possible, and share your knowledge digitally making it easier for your successor to find valuable information.
- Introduce your successor to clients: Make sure the person replacing you is familiar to your key clients and put them in charge of managing those accounts, if possible, before the transition. That can help ease client doubts when change occurs.
Be proactive in searching for your successor
Succession planning is something that many companies and CEOs don’t think about until it’s too late to do a thorough job to find the best suitable candidate. An attorney experienced in all areas of Pennsylvania business law can help you develop a comprehensive plan to guide the success of your business for years to come.