By Ken Ingram – Did you know that the first known use of the word plan dates back to the late seventeenth century? If your plan is to pass on the business to the next generation and/or key employees, a plan becomes essential. You need to determine your succession plan.
Your Succession Plan
At one time or another most of us have followed a recipe from a cookbook. Why do we do this? We do it to learn. By following a process created by an experienced cook, we can then adapt it to our tastes. We make it our own by repeating the process. Succession planning is a similar process.
Owners who have spent 20 to 30 years building a solid and profitable business often fail to develop succession plans. What is it about planning that most people seem not to like? Why do they prefer not to think about it? Benjamin Franklin famously said, “If you fail to plan, you are planning to fail.” If this is true and planning has a benefit, then why do we fail to do enough planning?
Important to Start Planning Early
The people being tapped to lead the business into the future have often never been through such a planning process before. They may be unqualified to develop a plan on their own. If we involve them in the process, however, they are more likely to follow it. Then, as the business owner, we have the responsibility to invest in them – time, money, and energy – to ensure when the time is right, they are ready to lead.
It takes years to transition a business, so start your exit plan early enough to invest the time required in those people chosen to carry on. Understand they learn at different speeds and in different ways. Mistakes are one of the best teachers, so its best to create an environment where the mistakes can be monitored and minimized. Once you walk out the door for the last time, it’s too late.