Having a template for succession planning can save a lot of time and stress down the line. Particularly if the transfer of ownership happens following an emergency, like a sudden illness.
This blog will look at the critical issues you need to think about when looking at the future of your business. Succession planning is something that all businesses of all sizes should do, but hopefully never need to put into practice.
Template for succession planning
FIrst thing’s first, what exactly is succession planning? It’s an internal process of deciding who will take over your business if needed. Reasons could include:
An accident/unexpected incident
This succession planning process remains relevant for businesses of all sizes and is crucial for protecting your business in the long run.
Your plan needs to:
1. Identify the transition process for filling roles
2.Outline the key skills and qualities needed for your role to be filled
3. Explain the developmental focuses needed to continue business progression
Understandably, succession planning may seem like it won't be relevant for a long while, and preparing early might be a low priority. But, having a template for succession planning doesn’t only give you peace of mind, it also ensures your employees, supply chains, and your business operation as a whole, can continue to operate smoothly should something unexpected happen.
By following the advice in this article you will be able to construct your own template for succession planning.
Benefits of succession planning
There are some clear benefits of completing succession planning. These include:
Being prepared and ready for the unexpected
Succession planning should be approached in the same way that other business risks are mitigated.
Having clear retirement plans
This can make the future more tangible and easier to work towards, and when the time comes, let go of the business.
Make the process easier
Succession can be messy if not planned for, especially if key individuals are not able to take part in the process due to illness or an accident.
Confidence that your business will be in the right hands
Planning for the transfer of ownership shouldn’t be taken lightly, especially as your employees will continue in the business and you will want to ensure their success.
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Seamless succession planning
To effectively manage succession, you’ll need to identify the impact of each key role within the business operation. This may highlight that some individuals are doing lots of important jobs, making them critical to the functioning of the business.
The next step in succession planning is about identifying the people who have the skills and experience to fill those roles, or knowing that you will need to start a recruitment process right away, if the need arises.
If there’s internal talent that could be used, then training and mentorship opportunities for these individuals need to be set. This’ll not only make your team more effective, but it’ll put you in the best place to manage should a succession event occur.
Should the business owner or other key individuals are heading towards retirement, this can be a managed process that starts well ahead of time. Succession planning allows for a seamless transition, with minimal disruption to your business, relationships and processes.
If the long term plan is for your business to be transferred to a family member, succession planning simplifies the process. Plus, it highlights the tangible steps on the path to the transfer. Preventing frustrations, miscommunications and even potential conflicts. If there is a firm plan that’s transparent and clear, transferring ownership can happen on an agreed timeline with all parties happy and clear of responsibilities at all times.
Having a template for succession planning allows you to have contingency plans in place for events which could be terminal to the business. For some owners and founders, these events may be considered so low risk that it isn’t worth devoting resources to, but if the outcome is that the business fails, it’s a risk that has to be mitigated against.
To recap, a successful succession plan should include these steps:
Define the key roles and individuals within the business.
Identify people that could fill the roles or replace people should the need arise. Including having strong recruitment processes that can be started without delay.
Outline the retirement plans of people within your business and review these periodically.
Set ownership transfer plans and agree a process that leaves the business in the strongest possible position.
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