Succession Planning: It’s Not All About You Succession planning takes the skills and experience that made you successful in the first place and focuses them on what your business and business heirs need to thrive in a changing world.
Nicholas Preddice Founding Partner AffinityBST Advisors 973-534-5785 npreddice@affinitybstadvisors.com
Thebiggesthurdletoeffectivesuccessionplanning isover? notWhat are their needs Who will take financialorstructural,butpersonalandpsychological. and capabilities? Oftenthosewhobuilttheirownbusinessidentify so Internal promotions are cost and culturally effective. I urge
closelywithitthattheycan’tquiteletit go.Yes,they myclients to:objectively )1 assessapotentialcandi knowthey’renotimmortal.Yes,theywanttoenjoy theandinclinationforleadership:map capacity )2 outa
fruitsoftheirlabor.Yes,thenextgeneration to ofcompetenciesandexperiences;and month -21 iseager timeline comeintoitsown.“ButI’mtooyoungandbusytomeasure )3 think howwelltheymeetthosecriteria. aboutthatrightnow.”“ButIalreadyknowthat[insert Who else needs to be involved? namehere]willtakeoversomeday.” AnewCEOneedsareliableC-levelteam.Bringyour Thiskindofabsolutistthinkingignoresthe CFO,complexities COO,CHRO,etc.into , theprocess;itwillbroaden andrealitiesofwhatthebusinessneeds,potentially your planning perspective and keep them appropriately
settinginmotionpainfulconsequencesforboth people informed sotheycanintegrateyourobjectivesint
andtheorganization.HBOhasbuiltahitcomedydrama, respective planningandhiringprocesses.Sizablere
“Succession,”aroundjustsuchaworst-casescenario. bonuseswillmakeitworththeirwhiletomaintain Theschemingandplottingofthedysfunctional Roythroughout the coming transition. course
familyisanobjectlessoninhownottosucceedasa Furthermore,don’tleaveotherbusinesspartne familyinbusiness. dark.Introduceyoursuccessortoyourbanker,espe
HOW TO SUCCEED AT SUCCESSION
ifthebusinessisleveragedandyou’retheonesec Bothcontingencyandlong-termplanningrequire the loans. Transitioning leadership includes opening
owners/CEOstofirstdotheemotionalheavylifting of thenextgenerationofbusinessrelatio doorsfor accepting that they cannot forever hold the reins. Once
What’s next for the retiring CEO/owner, and how will youembracechange,youcanmorereadilyapplythe they be remunerated? skillsandexperiencethatmadeyousuccessfulinthe WhilemanyretiringCEOsshiftintoadvisoryrolesan firstplacetodrillingdownintothedetailsofcraftingan jointheboard,it’scriticaltodefinethefinancial effective succession plan. that secures your retirement. Clearly articulate your
expectationsandbringinoutsideexpertstoadvis
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