You and Your Business Idea Need a Succession Plan

Succession planning, both personally, through an estate plan, and for your business enterprise, is imperative to provide a lasting legacy for your family. The most important thing that you can do is to spend the time and effort required to get a plan in place. Once a plan is completed, modifications and updates are generally easier and less time consuming to make and should be incorporated as your life and business interests change.

The benefits of business succession planning are multitudinal. Succession planning allows you to define your business’s legacy, while encouraging the leaders of your business to support the growth of your business’s employees. Clear succession planning keeps productive employees engaged in your business as they can see distinct opportunities to grow and reach higher levels inside your business. Unforeseen events can also be mitigated by having a succession plan in place as the plan should address what is to occur if an important leadership role in your business becomes vacant. Generally, the end result is a thriving business that saves money because it is able to run smoothly, even during turbulent times, and can largely fill leadership roles from within, which tends to be significantly more efficient by avoiding having to pay a premium to hire an outside person into a leadership role who may not fit the culture of your business.

The most significant impediment to succession planning is finding the time to develop and implement the plan, especially with successful business owners. When the owners find the time to create a succession plan, they must be willing to trust the employees that will grow into the business’s leadership roles, and this involves the owners letting go of insecurities and becoming a conduit to help those employees by working together with them to build relationships that will continue growing the business in the future.

There is no better time than the present to start the business succession planning process, or if you have a business succession plan that is a few years old, to review and update it. Doing so will help continue your business’s growth while providing a lasting legacy for your family.

Tom is a board certified tax attorney focusing on estate planning and administration with business owners, including business succession planning matters.