2. Choose a successor:
Identify what skill sets are
required by the successor:
-
Marketing
-
Management (People Skills)
-
Finance
-
Production
-
Industry specific background
-
etc.
Identify the role of the
successor [
Management v. Ownership]:
Will the successor have
management control or ownership,
or maybe both?
Ownership can be split
into passive and active shares,
giving the active successor the
necessary control over the
business but providing an equal
economic benefit to the inactive
shareholders
Identify where the potential
successor will come from [family
member, employee or outside].
Will that individual be a family
member, an employee or someone
from outside the organization
such as a close friend or
colleague. Taking someone
from inside the organization has
its advantages. Such
individual would already be
familiar with the operations of
the organization and would
require a shorter transition
period. Going outside of
the organization offers you the
opportunity to bring in someone
with new skill set that is
lacking within the organization
that is essential for future
growth. Going outside the
organization also enable you to
avoid potential internal
squabbles amongst family members
or amongst employees which could
have a negative on the future of
the organization.
You can make the selection on
your own or you can put together
a transition team to help you
decide that question. A
transition team can assist in
the planning and execution of
the transition thereby ensuring
a smooth transition even in your
absence.