Time to Start Thinking About Your Successor
Exit planning is one of the most important areas of small business leadership discussed by members of Catapult Groups. CEOs, business owners and other leaders often need to be reminded to step outside day-to-day operations and begin thinking about what happens after they leave the business.
Here are suggestions to help focus your thoughts on what to look for in a successor, part of the exit plan that’s best for you and your business:
Picture your ideal successor.
It’s natural to envision a successor who comes with the same characteristics and experience you do. It stands to reason that the business will operate better in the future if it’s led by the same type of personality that grew it in the first place. Right?
Actually, the answer is (in most cases) no. Growing a business and leading an established business are two very different things. CEOs or business owners who wish they could clone themselves miss the point of succession planning. Businesses change over time and the skills required to lead tomorrow are rarely the same as skills used in the past.
Start seeking out men and women who have already demonstrated leadership qualities within your company. If they seem like potential succession candidates, what can you do to help groom them for your eventual departure? (In family-owned businesses, the preference is often to appoint someone within the family—but this candidate should be assessed objectively based on his or her abilities, not by the nature of their relationship to the current owner.)
Start the grooming process.
If you’re lucky enough to find the right person internally, it’s never too early to begin grooming him or her for the future. Gradually involve the candidate in daily business finances and operations. Have them sit in on key meetings or sessions with your direct reports. (Remember, it takes time, be it months or years, for anyone to absorb all the nuances of a successfully run business.) As you observe your successor in action, don’t hesitate to identify and discuss gaps in knowledge or any other leadership weak points. The earlier you spot these deficiencies, the sooner they can be addressed and fixed.
Publicly endorse your successor.
Once you identify the person you want to succeed you, it’s essential that everyone in the company understand you have full confidence in this individual’s ability to lead. Introduce him or her to all departments and express your enthusiasm for the new leader’s vision of the future. You can further demonstrate this confidence by encouraging them to develop their own approach to managing the business.
The best way to ensure your company’s future livelihood is to think about your successor today.
Members of Catapult Groups are CEOs and business owners who help one another develop effective exit strategies. If this is your goal, and you’re simply too swamped with daily operations to give this the thought you deserve, find out more about how membership in a peer advisory group can help you work on your business, rather than in it.