Invest in succession planning for your Colorado business to add value and create a future for your employees and your benefactors. Just like you create a will for your personal assets, a succession plan creates a guide for what happens in the event you leave the company for any reason.
What is Succession Planning?
Succession planning identifies who will take over and the process to follow when the owner or leader no longer runs the business. The key part of succession planning is determining the specific individual or team to take over the business. However, that is not the only factor in a succession plan.
Business owners may decide to leave the business due to retirement, selling the business or to start a new venture. Also, illness, death or other life events may occur that limits a business owner’s ability to lead.
A succession plan provides a guide map for what happens when the owner leaves. When done well the succession plan is based on careful consideration and advanced planning.
Benefits of a Succession Plan
The primary benefit of developing a succession plan is to ensure the right people take over the business so that the business continues to run smoothly in the owner’s absence. A strong business must not hinge on one individual for success. The process to develop a succession plan provides insight into the current health of your business.
A succession plan also offers peace of mind that if something happens to you, as the owner, your business doesn’t automatically fail or lose its value. Create order and avoid delays in the event of your death or unexpected absence with a well thought out plan.
Another great benefit of a succession plan is the confidence your employees will feel knowing you trust them to continue in your absence. As your team feels empowered, you’ll have the freedom to work less and enjoy your life outside of your business for an improved quality of life.
How to Create a Succession Plan
Developing a succession plan takes time and careful consideration. Take this task seriously to ensure your business continues and thrives.
1 – Organize your business financials. Don’t leave a mess for your successor. Even if you have no current plans to leave your business, good financial planning will improve the daily running of your business.
2 – Invest in a business valuation. Your business’s value may be different than you think. In fact, if your business only runs with you present, then it’s worth may tank if you’re not around. A business valuation not only lets you know what your business is worth. It also helps you understand the necessary changes to increase the value.
3 – Determine the successor of the business. If you want your business to run well in your absence, you must groom your successor. In addition, if you have other individuals skilled at running the business, you’ll have more freedom and less pressure while you’re still in charge.
4 – Put your plan in writing. The best laid plans mean nothing if you don’t put them in a legally binding document. Work with a business planning professional, like Alliance Business Coaching, to take the correct steps to develop a solid succession plan.
Work with a Professional Business Coach
Succession planning ensures the continuation and health of your business. If you find it difficult to even consider what happens if you’re not able to run your business, then you need the guidance of a business coach.
At Alliance Business Coaching, we work with business owners and executives to empower you to realistically understand the current state and value of your business. We help you identify strategies to meet your goals, like developing a succession plan.
Start today by scheduling a free consultation. We offer business coaching, business valuation and more to support your efforts to build and run a strong business while maintaining a great quality of life.