There are often many professionals at any successful organization who have important roles in the company’s operations. From executives to managers, those professionals oversee daily operations and influence the company’s success. A sudden departure of one of those professionals could leave the company in a lurch. The remaining workers may not be able to competently perform the role held by the now-absent professional. Whether someone dies or experiences an incapacitating medical emergency, they become unable to perform their job or train their replacement.
A succession plan is a way to mitigate the possibility of a professional’s absence or death harming a business. Succession plans discuss what it takes to fulfill a role and who might be qualified to take over that position. When should someone in a leadership position consider creating a succession plan?
When starting a new job
Frequently, the creation of a succession plan is mandatory. Successful organizations often integrate succession planning rules into employee contracts. Those in positions of influence at a company may have to create a succession plan within a certain amount of time. Such arrangements help ensure that the company can replace a professional if they move on to a different position elsewhere with little notice or have an emergency that prevents them from working.
When starting a business
Someone creating a new company from the ground up may need to create a succession plan as a means of protecting that new organization. Entrepreneurs who establish succession plans early can feel confident that their organizations can thrive even if they have to suddenly leave their position at the company. They can also feel confident that their employees, clients and customers aren’t at risk if anything happens to them.
When creating an estate plan
A business owner who has long run their own company or professional practice may eventually start thinking about their mortality. Estate planning involves addressing personal matters related to illness, incapacity and death. Someone creating an estate plan in their private life may benefit from simultaneously developing a succession plan for the business that they own and run. The sooner a professional creates a succession plan, the lower the likelihood of the business experiencing a sudden transition that causes major hardship.
Considering what it takes to successfully run a business and committing that information to writing can help protect an organization. Succession planning is an important undertaking for anyone in a position of leadership who is worried about the future management of a company.