I have written about business plans, and part of that process is succession planning. Too many of us take it too lightly, specifically the smaller companies. Well, future success is in the planning, please start now.
Start by de-emphasizing your role in the company. Remember, the objective is to allow the company to function without you. Whether you choose to leave or are physically incapable of performing your responsibilities or maybe you have been kicked out due to a divorce proceeding, your employees and your estate are entitled to the benefits of succession planning.
For example, many of you see Harvey Mackler, not necessarily GEMPIRE. I have an experienced team behind me, but I am the “face” of the company. (I have been told that I have a great face for radio!) I try to remind the industry that it is a company effort; it is about GEMPIRE, not me.
Then I need to follow this up with real actions. Let’s talk about developing a strong management team.
Can your company function without you? There are many functions that you do, some of which you do not even think about twice. Can the others do those tasks? Have you trained them to do those tasks?
Besides training your employees, have you empowered them? Can they speak and function in your absence? Try it for a week or two.
Have you assigned all of the management tasks? Do your employees understand them? Try documenting them.
Smaller companies face other hurdles. If you are a one person company, you need to rely on others, such as your lawyer and/or accountant. Somehow you need to preserve this asset value for your estate, and you (your company) also need to maintain your customer relationships.
Then you may have family members in your company. What are their roles? Have you documented them? Do your other employees understand those complicated roles?
Sometimes the best way to manage family business succession planning is to have an independent third party get involved, either in a consulting arrangement or as a full time employee. Have you given them the legal authority to handle these responsibilities.
I can immediately recall two very successful family owned businesses which brought in outside personnel. One was a consultant for JournalBooks and the other example was a full time CEO for Dart. Both had very favorable experiences. It may require a Board of Directors to assist you. Even a small company can assemble a capable Board.
It can be very difficult to let some things go, however all of your stakeholders deserve it. Try it, you’ll like it.
A 1975 graduate of the Wharton School at the University of Pennsylvania, Harvey enjoyed a 20+ year career in commercial banking, exercising his “golden parachute” in 1996. In his volunteer life, he is a past chair of the Small Business Banking Unit of the American Bankers Association, Easter Seal Society of New Jersey, the SAAGNY Foundation, PPAF EXPO, and Supplier Committee of PPAI. He is also a past President of PPAF. PPAI awarded him the H. Ted Olson Humanitarian Award in 2013.