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Why should you work on a succession plan early?

On Behalf of | May 13, 2020 | Business Formation & Planning

Florida business owners have a lot on their plates. They must handle everything from structuring a business to figuring out how to run it. Where does succession planning fit in? Some people believe you do not need to tackle this for a long time.

That is not true. Succession planning is a crucial part of running a business. Not only that, but early succession planning is important. It helps you and it also helps your successor and business. Today we will look further into this.

The advantages of early succession planning

The Harvard Business Review discusses early succession planning. They break succession planning down into what studies have shown about it. Why is early succession planning supported by these studies? In short, no one knows how their life will go. No one can guarantee they will always want to run their business. In some cases, your business career may end up cut short. This happens due to surprise illnesses or injuries. You may end up caring for a loved one. In any of these instances, having a succession plan in place saves you stress.

Helping your successor out

It is also good for your successor. Taking over a business is a big deal. Not everyone prepares for it. Let us say you ask a successor without much time for them to think about it. They may feel pressured into answering without thorough consideration. This could lead to poor and unenthusiastic leadership. You may end up unhappy with how your business runs. Your successor may end up unhappy with their responsibilities. It is a lose-lose situation for everyone.

To avoid this outcome, be open and communicative with your successor. Make sure they know they are a candidate to inherit the business. Be open about your succession plans and work on them early.