Succession Planning: What can I expect?
Our Business Succession Planning Process
Succession planning is a complex and multidisciplinary process. We work closely with you to develop a clear strategy and action plan that recognizes your unique circumstances. Steps involve the following:
Outlining objectives and goals
From a client’s perspective, succession planning is the final stage of their continuity in the business. The question is, “Will there be a next stage?” Most business owners want to see a continuation of the business, but how will that look?
Some typical scenarios include:
- Selling to a competitor;
- Transitioning to next-gen family member(s); and
- Transitioning to the existing management group.
It is essential to consider the available options to determine the best next stage for the business and family unit. Our strategic advisors are here to help.
Identifying value drivers
Value drivers are key variables and activities that have a significant impact on your business and affect the valuation of the company. Identifying value drivers is crucial to understanding how to maximize the value of your company.
When contemplating a transition, you want to maximize the value of your business. That is where the concept of value drivers becomes critical. Optimizing the value drivers of your business will maximize your proceeds upon sale. When looking at succession planning, our strategic advisors help you determine the key value drivers so that you can optimize the value of the company.
Creating new processes
When developing a succession plan for your business, it is crucial that the company has a proper management structure and set of processes to ensure it operates independently of its owner/founder.
Personal goodwill applies when the company depends on the owner, or customers view the business as the owner instead of a separate entity. This is not a positive item from a succession model point of view because it means the company is dependent on the owner. As a result, when the owner leaves, the company cannot operate similarly.
It is critical to identify these facts early in succession planning and work to mitigate the effects and develop a self-sustaining business that can be easily passed on to the next owner.
Don’t leave the future of your business up to chance. Contact us to talk about creating a succession plan for your company.
