Succession planning raises one, and possibly two, questions: 1) Do you want your business to continue after you are no longer active? 2) If yes, what are your options, and how do you plan for those options?
When it comes to succession planning, you have four broad options: close the business; continue to be involved in the daily activities of the business, but have the ability to take time off whenever you want to do so; continue to be involved in the business, but as an advisor or as chairman of the board of directors; or sell the business.
If from the beginning, you build your business with the plan of selling it, you will be able to choose any of the four options.
In a past blog, I proposed a four-step chronological plan for building a business:
- Build the dream.
- Build the team.
- Build the processes.
- Build the profit.
The business must be built in this order. Changing the order will prove fatal to the company. To plan for succession, you must continue to follow these steps. As the business owner, you must continue to be a cheerleader for the 'dream'.
Perhaps most importantly for succession, you must build leaders who have their own dream (the 'team').This begins with delegation. Give your key people responsibilities and allow them the opportunity to fail or succeed without retribution. In almost all cases, your key people cannot do anything that will jeopardize the business. They will buy from a secondary vendor, decide not to charge a customer and choose the wrong people to do a project. None of these choices will bankrupt your company. They will do things differently from you, but that does not mean they are less skilled than you, the owner. When they need correction, remember to be a cheerleader and support them in building their own dream while becoming a leader.
By developing leaders within your company, you are not required to execute as many duties as in the past. The leaders do it for you. As they become more confident, they will create processes that work, and these processes will benefit the company. Just because their processes are different or new, don’t refuse to accept them. Evaluate them on whether they help the company achieve while reducing your workload.
When you have leaders in place, you can continue to be involved in the daily activities of the business but have the ability to take time off whenever you want to. When you have leaders in place, you can continue to be involved in the business, but as an advisor or as chairman of the board of directors. When you have leaders in place, you can sell it and get top dollar because you have people in place that can and will run the business without you.
The author is president, Evans Glass Co., and chairman of the board for the National Glass Association. Write him at email@example.com.
The opinions expressed here are those of the individual author and do not necessarily reflect those of the National Glass Association, Glass Magazine editors, or other glassblog contributors.