Questions to Consider When Developing a Succession Plan
August 9, 2019 | Connecting Iowa
There is no argument that developing a succession plan requires a significant time commitment. In addition to time, support and agreement among company leaders is also critical. Business leaders do not consciously avoid succession planning, as they understand the value. However, the daily grind of running their business tends to get in the way.
On average, 10–15% of corporations appoint a new CEO each year. Statistics show that most boards are not prepared to replace their top executives. Nearly 40% of businesses have not even started thinking about successors. Will the successor be an internal candidate? If so, who? The answers to these questions are critical in the unfortunate event of a death in the organization. Taking the time to develop a succession plan is key to the longevity of any business.
It has been said that the best time to plant a tree is yesterday. We believe the same holds true for succession planning. It is safe to assume that business leaders will continue to be bombarded with the daily tasks of running their business. Meaning succession planning efforts will most likely continue to be pushed down the priority list.
Consider the following questions before jumping into the succession planning process:
What are the key roles that are essential to the success of the business?
Where will the successors come from? Internal staff? External candidates?
The first step toward developing a succession plan begins with the realization that the need is critical to the company’s ongoing operations and success.
A robust succession plan may take time, but rebuilding a business takes longer. Plant the tree, yesterday.