Why is Succession Planning a “Must” For Business Owners?

In the wake of the last recession and an increase in competition throughout many markets, businesses can do a lot for themselves by planning ahead with regard to succession. In many cases, doing this can help to mitigate the risks associated with an unclear future. 

For family-owned businesses, one of the stages of their lifecycle has to do with succession planning and to what extent, if any, children or other family members are interested and included. Recent research reveals that up to nearly one-quarter of all family businesses don’t have a succession plan already in place. Nearly half of senior business owners expressed concern in the same survey about passing on control to the next generation. This dynamic can only generate problems, one of which is known as “sticky baton syndrome”. This refers to situations where an older generation passes on management responsibilities in theory but doesn’t really let them go in practice. This means that the successors don’t get necessary experience to take over confidently when the older generation exits the business entirely. This can interrupt the flow of business or challenge its existence altogether.

Succession planning is a process that should be approached with careful thought. Communicate with a business succession planning specialist today to learn what tactics might work best for your family-owned company. To get more details about your business, reach out to us at info@lawesq.net.