Are you thinking about starting a formal succession plan in your business? We know that busy business owners would rather visit customers and focus on business operations or anything else before turning time and attention to succession planning. If this sounds like you, here is some advice from Excelerant Partner Jennifer Adcock, MS, CSP (Certified Succession Planner), SPHR (Senior Professional in Human Resources),and Steven Perret, President of Letterman‘s, to help you get started.
To take a deep dive into the topic of planning for company succession, click here to read the full interview with Steven Perret and Jennifer Adcock.
Q: What is a formal succession plan? A formal succession plan identifies potential successors and identifies how the company will develop its next in line talent.
Q: Why should anyone care?
Formal succession planning reduces the randomness in an company’s hiring and promotion processes. A formal plan establishes the steps, policies and procedures to select next-in-line leadership.
Q: Should a succession plan just deal with ownership issues? No, planning for who will be your next VP of Sales, Operations Manager and other key positions can have great results for the company as well.
Q: Is succession only an issue in family-owned businesses? No, most small business owners plan to sell their business and many will sell to either employees or family members according to the FPA/CNBC Business Owner Succession Planning Survey released earlier this year.
Q: How would I go about creating a formal succession plan? At a minimum, a formal succession plan usually involves some type of facilitator/coach to:
- Work with owner and his professional advisors to narrow down succession options
- Facilitate conversation, at an appropriate time, between the current owner(s) and the potential future owners and other stakeholders (like non-participating family members).
Here are some important steps in a formal succession planning process:
- Create selection criteria for the future owners and/or leader(s)
- Identify potential candidates (internal or external)
- Assess potential candidates
- Design a Development Program for identified next in line leaders
- Create a Leadership Transition Plan including a time frame
- Create a Ownership Transition Plan including a time frame
Jennifer Adcock, MS, SPHR, SHRMP-SCP, CSP, sHRBP – Jennifer applies her expertise in strategic human resources and leadership training to support her clients in the development of their organizational infrastructure and their people. She works together with clients to create, deliver, and implement a plan of action that supports the company’s present and future goals. As a strategist, Jennifer collaborates with business leaders and executives to create and implement plans of action with regard to training, employee retention, policies & procedures, performance management systems, and employee development plans.