To safeguard your business’ continued success, you should invest some time into putting a succession plan in place. Therefore, in the event that a key employee leaves, you’ll already have a possible successor in mind. Such plans are also useful for retaining your best performers, who are the kind of employees that benefit most from having a clear idea of their professional future.
Whatever the future may bring, even the smallest of businesses need a solid strategy in place to ensure that their company will be in good hands. For help getting started, check out our succession planning tips below.
It’s best to get a head start
People often make the mistake of not giving succession planning the attention it needs at an early enough stage.
A planned retirement is one example of a situation in which you have plenty of notice before losing a valuable employee who will be difficult to replace. Sometimes, though, an employee’s departure can come as a complete surprise, and this can result in a stressful time for the business. So, it will be good for you in the long run to start working on a succession plan as soon as you can.
Define your goals and clarify your vision
Evaluate how well you are doing in relation to the targets set forth in your business plan. Ideally, your business would be taken forward by someone who shares your vision and in whom you have complete faith.
Identify skill sets and pinpoint potential succession candidates
In order to carry on your company’s success, what qualities would your successor need to have? Is there anybody you know who has had a similar experience? The growth of a capable and skilled workforce is facilitated by a business that promotes employees’ continuing professional development.
There may be a natural choice for a position’s successor based on an organisational structure, but that doesn’t mean you should overlook other qualified employees. Find people who, no matter what position they are in now, already have the skills that could help them do well in higher positions.
However, you shouldn’t presume to know your team members’ professional aspirations. While you may have particular members of your team in mind for senior roles, there is no guarantee that they will be interested in the opportunity once it is given to them. If you haven’t previously, you should check to see how your workers feel about their future with the company before making any succession decisions.
Make sure to let successors know in advance
Communicate with each successor individually and explain why you plan to promote them to positions of increased importance. To avoid disappointment, everyone involved should be aware that the situation is fluid and might change at any time due to events beyond anyone’s control, including the business and the potential successors.
Write a will
In the unfortunate event that you or your business partner should pass away, having a will in place will ensure that your assets and shares are distributed according to your wishes. Seek the advice of a legal professional to ensure everything is in order.
If you are the current director of a limited company, you should find and appoint your replacement before you plan to step down. You must also notify Companies House of any amendments.
Get in touch
We hope that our succession planning tips have provided you with a solid foundation from which to start the process. For any accounting or business advisory services, please email us at firstname.lastname@example.org.