The Art of Succession Planning: Delegating for a Future Beyond
Your business is thriving, and your processes are in a flow. You—and your team—know the ins and outs of what makes the business tick. But who will do the work you do when you’re gone?
Succession planning is one of the most critical components of exit planning.
This article gives you a high-level overview of what succession planning is, outlines the dangers of neglecting it, and gives practical next steps to set your business up for the future.
What Exactly is Succession Planning?
The term “succession planning” may sound elusive or vague, but the process can be summarized into two key activities: delegating responsibilities to others (building a strong team that can run your business whether you are there or not) and training someone to lead the company in your place.
Many business owners find themselves unable to delegate because they’re trapped in a cycle of immediacy. The most present needs seem the most pressing. But planning for the future now is one of the wisest things you can do for your business!
The Delegation Dilemma
The first step is acknowledging the necessity of delegation. Sound simple? Think again! While it might be straight forward for you to see the necessity of delegation, the real challenge is having a documented process.
Without documented procedures, it becomes difficult to hand over responsibilities as others cannot replicate your steps for similar results. The dilemma is compounded by your overwhelming workload, creating a self-perpetuating cycle.
Breaking the Cycle
To break free from this cycle, you must change your perspective.
When you insist on handling everything personally, growth is naturally impeded. Because of this, empowering others to contribute is essential. Growth is only achievable by stepping aside and allowing others to take on responsibilities.
Self-Reflection Questions
To initiate the shift in perspective, ask yourself these questions:
- What are my desired roles in the business?
- What tasks am I best at?
- What responsibilities would I delegate if given the opportunity?
- How do I envision my current and future lifestyle?
- What are my business and personal goals for the coming year or five years?
Taking a Step Back
Notice what rises to the surface as you work through these questions. Are there particular times where you delegated a project and it was successful? Identifying your hesitancy behind delegation can free you up to plan for a better path forward.
This type of strategic thinking allows you to step back from daily minutiae to consider the bigger picture in both business and life.
You can take a time audit to understand how time is spent in your business. A week-long audit, broken down into 15-minute increments, will help you categorize tasks and quantify time dedicated to each category.
An audit helps you allocate time needed for…
- Administrative tasks
- Financial tasks
- Operational involvement
- Legal responsibilities
- Sales and business development efforts
- Personal or leisure activities
The Delegation Process
Once armed with a comprehensive understanding of your time allocation, you can initiate the delegation process.
First, identify tasks that only the owner can perform and highlight those. Try to take your personal skillsets and investment out of this, thinking only of the role of “owner.”
Second, recognize areas where you’ve contributed to this role with your unique skills. What traits would you want to see replicated in your next leader? The goal is to systematically hand off responsibilities to pave the way for a successful exit from the business.
Finally, take time to identify the areas of your business that can be handled by more junior or administrative staff…and let go of them! Maintaining clear role distinctions will allow you to focus on the big-picture strategy of leading your business.
In Summary…
Succession planning requires a proactive approach to delegation and training. By empowering others and strategically delegating responsibilities, you can ensure a smooth transition, foster growth, and secure a thriving future for your company.
At Capital Concepts USA, we have financial, marketing and sales, and operations consultants who can work with you to craft a plan and set goals that will make a difference in your business. Contact us today for a free 15-minute call with our founder, Lorne Greenfield.
Related Articles
How To Avoid the Biggest Valuation Mistake Made by Business Owners
You’ve been working on the sale of your business for months now. All the work, not just to complete this sale but to build a business someone else actually wants to buy, is about to pay off.
You hold your breath as the sales agent slides a piece of paper across the desk towards you…with a number completely different than you’d negotiated!
“As you know, we did a final business valuation last week to determine the final sale price for the closing today,” she explains. “After reviewing all of your records, we have determined that the value decreased from our initial estimate a year ago. As a result, the sale price will be 25% lower than we originally planned.”
What happened to the profitable sale you worked so hard for?!
What To Do If Your Business’s Valuation Is Too Low
You’ve decided to create an exit plan, and now it’s time to find out how much your business is worth. What if the value comes in lower than you expected? In this week’s Insights article, we talk about common issues that contribute to a low business valuation and how to move forward.
How To Prepare for a Strong Business Valuation
You’ve been reading our series and have decided to do some exit planning. You’ve audited your time, started planning for your free time, and have an idea how much money you’ll need for the next chapter. Now it’s time to find out what your business is worth now, so you can create a plan to get it to the value you need it to be. This week’s article shares the information you need to gather for a professional valuation, and what to do if you don’t have that information ready.
Need Fresh Eyes On Your Business?
We offer complementary consultations to help you identify the areas where you could most quickly and easily improve your business’s performance, value, and profitability. Request one today.