Every business owner needs to spend some time planning how to either sell the company or pass it along to the next generation. Yet no one should try to create a succession plan alone. One idea to consider: Form a succession planning advisory board.
Such a board can serve as a voice of reason among the often cacophonous tumult of a business transition. Moreover, it can help you assess the strengths and weaknesses of potential successors unrelated to your personal concerns or biases. And, when you make your pick, the board can help in your successor’s assimilation.
Board members’ varied perspectives usually provide a more objective and collaborative approach to analyzing succession problems and developing fresh solutions. They can further assist by mediating organizational disputes, giving feedback on your heir apparent’s progress and reassuring business stakeholders.
It’s generally a good idea to start small, with a group of three to five potential advisors from outside your family and business. Once you’ve identified an adequate number of candidates, spend some time with each to gauge their interest and commitment.
Ask each member to commit to a specified term of service, so that you both can regularly reassess participation. In addition, ask members to sign nondisclosure agreements, as you’ll likely be sharing confidential information about your company. Clearly spell out the duties and responsibilities you want advisors to fulfill, too.
A new beginning
Creating a succession plan may seem like the beginning of the end to your role in a company that you’ve no doubt spent much time and energy building. But it doesn’t have to be.
Succession planning advisory boards often evolve into lasting business advisory boards that go on to help guide companies for many years. And you, as a former owner, would certainly have a seat at the table.
Most valuable asset
Many business owners rightfully consider their companies as the most valuable assets they own. As such, your company deserves a detailed succession plan so it stays in good hands. Please contact us for help establishing and maintaining that plan.