The Succession Plan, Critical to Protecting your Business and your People
Nov 15, 2022
Business owners need to prepare themselves for the inevitable future and a succession plan is one of the best ways to protect their organizations and the people that work for them, as well as their families. Yet, very few entrepreneurs actually have one.
- Not having a succession plan can cause enormous damage to the company's legacy and the relatives, sometimes beyond repair. And by the time business owners realize this, it's usually too late.
Life changes. People die and people quit. We have no control over these things. What we do control is how we prepare for them. So if you love your family and you are proud of what you have built, which I know you do, having a succession plan is a very wise thing to do.
To help you be ready, in this blog post we’ll go over the three types of succession plans you should prepare.
Why should you have a succession plan?
I remember when I was leading operations for a large organization and we were responsible to create succession plans for every level all the way down to the unit. That way, if something happened to ourselves or any of the company leaders, the people that were left behind would know what to do next.
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These were thoughtful and documented plans. We shared them with the responsible ones and updated them annually as needed.
Having them created a big sense of peace because we knew that people were ready to take things over in case we got in an accident, got sick, or any of our people, or ourselves, resigned.
It is important that business owners perform this task with a high level of professionalism, consistency, and detail. The worst time to decide what to do is in the middle of a crisis. So they must take the time to create this plan so the designated people will know exactly what to do in their absence.
Types of succession plans
There are three types of succession plans that you should have in place right now in your organization to ensure that in the case of your absence, the business continues to operate just as well.
1. The unit-level succession plan
You have to determine who are going to be the future unit leaders in your organization. This is usually called bench planning.
In every one of your units, you should have some sort of team leader. You may have assistant managers or shift leaders or somebody in the position between the unit manager and the crew members that run shifts.
What happens if one of those people is gone? That is why bench planning is so important. Every unit should have at least one or two rising stars with the potential to be a future leader of the organization.
Must read: Five strategies to develop leaders in your organization
Once your district manager and unit manager have identified them, they should focus on their development and training so that when a position opens, either at the assistant manager level or the unit manager level, they are ready to take over that leadership.
This will show your people they can grow and have a career in your organization. This is also critical so that the district manager does not end up running shifts or managing a unit instead of paying attention to their district the way they should.
2. The organization's leadership succession plan
You have worked very hard to build the legacy of your business and grow your organization to where it is today. But anything from sickness to accidents to situations outside of our control could put your leadership role in danger.
If you are not here tomorrow, whether because of a temporary situation or, God forbid, a permanent one, would the people left behind know what to do? What would happen in your business? Who would take your role if you are no longer there?
And then who will take that person's role if they're no longer there? You need to have a plan of what would happen in the absence of one or more of the people in your leadership team.
And this is something that you should do not only once but continuously, especially when new leaders join the team or when somebody leaves. That way, if something happens, people will know what to do.
3. Succession plan for your family
This one is also crucial because the process will represent a great challenge for your family, especially in the franchise world. But sadly, families have been destroyed, as well as business legacies, because a family succession plan is not done properly.
To avoid that from happening to your beloved ones, make sure someone within your family has clarity on how to act, what are your wishes, what you want to happen, and how you want it to happen.
The more you involve your family in these decisions the better so that there are no surprises in the end. But it is best if you also reach out to professionals such as your accountants, lawyer, and experts in succession planning to help you manage this.
Take into consideration that the discussion with your relatives should not only be about what should happen with the business, but also all of your personal assets.
Hopefully, nothing will happen to you for a very long time, but would it be great to have these things in place so you know that, if something does happen, everything is taken care of. That is why these succession plans are relevant: with them, you protect your life, your legacy, and your family.
Although here at The American Franchise Academy we are not experts at creating succession plans, we can help you with the documentation and the definition of your policies and procedures so that when you are not there, your people have the clarity of what to execute and how to do it so the business continues as usual.
Or better yet, so when you are still around you can enjoy the fruits of your work and your legacy because you delegated the operations and the supervision of your company. If this is something that you are interested in, schedule a call with me!
Find out how The American Franchise Academy can help you build those systems, policies, and procedures so your business can operate even without you there.
Go to CallWithAicha.com and let's talk about your business so you can grow and succeed.
You can also reach out to us by subscribing to our YouTube channel and following us on Facebook, Instagram, and LinkedIn. And don’t forget to listen to our podcast Franchise Success Formulas on Spotify and Google Podcast.
Reflections:
- Do you have a unit, an enterprise, and a family succession plan?
- Have you or your district manager identified the next wave of leaders in your organization?
- Is your key managing team aware of your business continuity plan and how to execute it?
- Is your family on board with the succession plans you have set for the company?
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