We don't always like to think too far ahead. Long term business growth strategies might not be a priority, nor might it be something we particularly enjoy thinking about, but certain outcomes are inevitable in everyone's life. In short, you won't run your business forever.
In the world of business, it is always wise to have a plan. Be it for one, five, or even ten years, you want to know that no surprises will disrupt your company. Such business continuity is very important, and it will continue to be important when your company is no longer yours to run. As a business owner, do you know what would happen to your business if something were to happen to you? Would your business be equipped to respond if you were out of the picture for a few weeks? A few months? Indefinitely? The value of succession planning cannot be overstated. Continue reading to see why it's so important.
What is business continuity?
Business continuity is a blanket term applied to a range of plans and procedures for disruptions to a business' daily operations. These plans and procedures allow businesses to persist in the event of a disasters such as a lack of building access, IT failures, loss of data records, and so on.
What is succession planning?
Succession planning is a process for identifying and developing new leaders who can replace old leaders when they leave, retire or die. Succession planning increases the availability of experienced and capable employees that are prepared to assume these roles as they become available. Taken narrowly, "replacement planning" for key roles is the heart of succession planning.
Why is succession planning important?
Unfortunately, too many small businesses take succession planning for granted, and don't have a plan for changes in management. It is impossible to predict when a business owner might opt for early retirement, or disappear for months due to injury or illness. Therefore, it's definitely preferable to put a plan in place now, before you need it. Failure to plan for succession is frequently a contributing factor when small businesses fail. A founder or business owner dies or is incapacitated, and nobody has been anointed and trained to assume command of the company. How disappointing it is when profitable and flourishing businesses fail due to a failure of succession planning, squandering the original business owner's endeavours and sacrifices.
Succession planning is part of a larger business continuity management
The Disaster Recovery Journal (DRJ) defines business continuity management (BCM) as, "A holistic management process that identifies potential impacts that threaten an organisation and provides a framework for building resilience with the capability for an effective response that safeguards the interests of its key stakeholders, reputation, brand and value creating activities. Similarly, the management of recovery or continuity in the event of a disaster. Also, the management of the overall program through training, rehearsals, and reviews, to ensure the plan stays current and up to date." Within the scope of business continuity management, DRJ defines succession planning as, "A predetermined plan for ensuring the continuity of authority, decision-making, and communication in the event that key members of executive management unexpectedly become incapacitated."
Don't wait to start your succession planning
If you haven't yet begun your business's succession plan, it's past time to think about one. By using Bartercard, the money you save selling old stock and increasing profit margins can be invested in developing the next generation of your company's leadership.