2 major considerations for creating a viable succession plan

Published By | Nov 9, 2022 | Estate Planning |

A succession plan has a major influence on what happens at a business when an owner or executive leaves. Some people only start preparing the succession plan when they decided it’s time to retire or they receive a job offer at another company.

The problem with a delayed approach to succession planning is that many professionals don’t know when they will leave a job. A sudden clash with another executive or a serious health issue might leave you unable to do your job and unable to create a thorough succession plan.

The sooner you draft a succession plan, the more protection the company will have when you are unable to do your job, regardless of the underlying cause. What are two of the most important considerations for effective succession planning?

What qualifications will your successor need?

Sometimes succession planning involves naming a specific person to take over your role. Other times, you will provide a list of qualifications that your successor should meet so that the company can start preparing some of its workers for the role.

From having certain qualifications and state licenses to specific training and job experience, you need to identify what skills and educational background will make someone successful when they take over your role at the company. Having a list of qualifications will make it easier for those managing the company in your absence to identify the right candidates to replace you when necessary.

What do only you know about your job?

There may be passwords to accounts that only you know or important plans regarding the business that you have not shared with others in writing. Including the major details in a succession plan and protecting them can be crucial if someone has to unexpectedly take over your position at the company. Otherwise, they may not even know what job tasks they need to perform or how to do your job.

The best succession plans will make it easy to choose the right replacement for an owner or executive and will facilitate that individual’s quick transition into their new role. Including the right terms in your succession plan will help protect the business that you have invested so much energy in developing.