Exit Strategy And Succession Planning

When is the right time to exit? What would happen to your business when you do?

Can your company survive without you in charge? What if one or more of your key personnel left — can the organization survive their departure? Do you know when you want to retire or take a lesser role? Have you considered the different scenarios that can occur affecting the organization?

Unfortunately, because of the demands of daily activities, for most business owners these subjects are at or near the bottom of their to do list. And yet, they are critical for your business and for your family. Having comprehensive strategies for the safe succession of key functions can make a significant difference in enabling you to salvage your business in dire situations.

Not knowing what life has in store for you or for your employees —for business issues, health, family, etc.—you need to be prepared, and having well-thought-out plans in case the unexpected happens can give you peace of mind. This SkillBite contains the key issues you need to address and the steps to take to develop a plan to cover the company’s needs when you or other key personnel leave the company (a succession plan), and a plan to cover your own needs for when you leave the business (exit planning).

Exit strategy and succession planning are two subjects that go together; they are complementary to each other and dependent on each other. If you think about exiting your business, you must plan on succession and when you develop a plan of succession for your company, you must consider your thoughts about exiting the business.

Your exit from the business can be on your terms (voluntary) or not on your terms (involuntary). Voluntary means that you elect when and how you exit and involuntary means that you exit because of death, disability or other unpredictable events. You need to cover both instances in separate plans. In addition, and as a necessary complement, you also need a succession strategy.