Along with bookkeeping, which we help entrepreneurs with on a daily basis, succession planning is one of the most overlooked aspects of a small business. It’s looked at as a necessary evil and something that can be tossed aside for now in order to take care of more immediate tasks.
Similar to how putting the right financial system in place for your business will help you long before it’s tax time, planning for succession has its own unique rewards. As entrepreneur Shuly Oletzky, Frigibar President and creator of Succession Proof, says, “Succession planning is not planning for your death, it’s planning for the living that will succeed you,” and planning requires actions that have additional benefits.
Here are four ways entrepreneurs benefit from planning for succession in their business:
Peace of Mind
When was the last time you felt stress-free? Any ounce of stress relief is weight off of your shoulders and helps you focus on what’s ahead. By having a succession plan in place, you can rest assured that your business will be taken care of even if something happens to you.
Learn Motivations and Intentions of Employees
There isn’t any technology available that allows you to read the minds of your employees, but you can just ask them what their motivations and intentions are in terms of advancing in your company.
By involving your employees in the succession planning process, you’ll uncover how they feel about what will happen to the business if you’re no longer in it. This information will help with short and long-term planning if you’re able to get honest feedback from your team and allow them to feel safe when sharing what they want out of the future of your company.
For example, you might discover that your second in command wants to retire in two years, or that a hardworking assistant is taking business classes and would like to move up in the company. Knowing where they stand will help you better prepare for the future.
Before you can reasonably expect someone to take over all of your tasks and responsibilities, you have to be able to document them. This process will give you, and your successor, a full view of how much you’re actually taking on, and it will give you a great opportunity to delegate non-important tasks now.
View succession planning as an audit of the jobs and responsibilities of key employees, including yourself. If you can’t reasonably expect the next CEO of your company to handle every single thing that you’re doing on a daily, weekly and monthly basis, then you shouldn’t be doing them. Delegate tasks that other employees can do to free up more of your time to focus on growth-related activities and to give the next boss a real opportunity to succeed.
Put Processes in Place to Improve Focus and Clarify Roles
Succession planning impacts the entire company, and should help clarify all of the key roles within the company. If your succession involves promoting a current employee, their current role will need to be passed down, and that role will need to be filled as well, and so on.
If you haven’t already done so, have each employee create a short guide explaining what they do, how they do it, and any other relevant information that someone stepping into that role would need to know. Going over these guides with them may unveil some opportunities and help make their current roles more efficient.
Have you planned for succession yet? If not, begin with having a conversation with your team about what the company should do if you were to leave tomorrow. For more, check out 7 Reasons to Plan for Succession in Your Family Business Today by Frigibar’s Shuly Oletzky.