Your Succession Plan is Designed!
- May 12, 2017
- Posted by: admin
- Category: Succession Planning
Business succession in any industry is challenging. Emotions, control and finances name a few issues, which will influence a result. Succeeding your business, whether to the next generation or sale to a 3rd party is not however, an event, agreement or transaction. It is a process evolving over time, which just happens to involve emotions, control and finances. Five (5) components are essential to optimize the succession of your business.
Timing and Commitment
Establishing logistics (i.e. economics, taxes, etc.) of an ownership transition is the easy part, though important, this is simply identifying already known facts toward assimilating an opportunistic result. The most important part is emotions. Hence, timing and commitment are necessities. Having built or led an organization for many years, “letting go” will be encumbered with emotion. Ensuring the next generation is prepared, able and engaged is a next step of timing and commitment.
Recognizing life can maintain a series of hurdles, succession can be voluntary or involuntary. The latter, as uncomfortable as it is to discuss, must be addressed. A sickness or death of the selling or buzz person(s) are issues to consider. Applying commitment to analyzing the same may prove prudent.
Energy and Momentum
With the exception of timing and your commitment, energy and momentum is an essential key element to business succession. Naming a quarterback to drive the process on your behalf is a must decision. Often times, a CEO is intimately involved in strategies, operations, and even selling. Therefore, it is helpful to have a long-time advisor (e. g. attorney, CPA, etc.) or specializing firm facilitate this process.
Recognizing process in your hardwood lumber business is important toward optimizing customer satisfaction and business profitability. Process is also, near critical, to a successful result. Experience is sometimes a valuable resource. Outside influences, such as government (i.e. estate taxes, etc.) economy and/or competition are intangible items, which could very tangibly impact your plan.
Detail and Coordination
Attention to detail will never be replaced. The quarterback and advisor team must pay attention to details for you, your family and business. Recognizing multiple people and organizations may be involved. Simply coordinating meetins, preparing agendas and checking status of outstanding follow items are part of the detail.
Finishing strong is a desired life position. Finishing strong with your business succession decision is challenging due to numerous business obligations and distractions. Many meetings have been had and time invested with too little accomplished, seems to be resonating theme. This in mind, follow-up (i.e. agreements, documentation, financials, etc.) to conclude the process will be refreshing.
By David Jacobs, President, TJT Consulting