Sikich Series on Business Succession Planning: The Power of Mentoring – Unite Business Plan with Succession Plan

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The owners of many companies launch their enterprises with a business plan, a written document outlining the company’s strategic objectives and practical means of accomplishing them. Likewise, many owners leave their businesses via a succession plan, a written document detailing how the company’s ownership should transition. 

Often, however, these two documents never cross paths, much less join toward a common goal. If this is the case with your business, and you’ve already identified your likely successor, effective mentoring can enable you to unite your succession plan with your business plan successfully. Read the following tips from Sikich’s Business Succession Planning experts on best practices in mentoring: 

Regular Meetings 

As your company evolves and its objectives change, you need to update the transition strategy to ensure your successor is learning the skills and gaining the knowledge he or she will need to keep your business competitive and, ideally, take it to higher levels of success. 

Let’s say, for example, that your company has always just sold widgets and is now expanding to help clients service the widgets. You’ll need to make both strategic and operational changes so that your successor and staff can handle a diversified business that’s both product- and service-based. In addition, your successor will need to understand the differences between managing the costs of distributing a tangible product and providing an intangible service. 

Make sure you meet with your successor often. The first days of running a company are particularly stressful. But coaching during the period leading up to the transition can help successors manage the pressures. This is your opportunity to leverage your experience and help your replacement develop the skills to run the business. 

During this time, you can provide a secure environment for him or her to apply these new abilities and assume more of your responsibilities. To maximize your mentoring efforts, have your successor meet monthly with key personnel to discuss current matters, growth and operations strategies, your and your competitors’ products and services, and industry trends. 

Outside Help 

Also have your successor join industry trade associations and community organizations to meet other executives and successors in diverse industries. And require him or her to review and, if necessary, help update your company’s business plan. 

To encourage your successor to develop relationships with key players inside and outside your company, include him or her in meetings with managers and trusted advisors. 

Key Information 

With the right business succession planning and strategic mentoring set in place, your company can continue to thrive after you’ve left the organization. Find ways to continuously pass on your knowledge. Too often, vital business knowledge is lost when leadership or ownership changes — causing a difficult and chaotic transition for the successor. Although you can impart a great deal of expertise by mentoring your replacement, you need to do more. For instance, create procedures for you and other executives to share your wisdom. 

Begin by documenting your business systems, processes and methods through a secure online employee information portal, which provides links to company databases. You also could set up a training program around core business methods and practices — workers could attend a class or complete a computer-based course — and create an annual benchmarking report of key activities and results for internal use. 

New Challenges 

Prepare your company to adapt and grow. With customer needs and market factors continually changing, your successor will likely face challenges that are different from what you encountered. 

To enable your company to adapt to an ever-changing business world, ensure your successor understands how each department works and knows the fundamentals of key areas, including customer service, marketing and accounting. One way is to have your successor work in each business area. 

Plenty of Time 

These key points emphasize the importance of choosing your successor as early in the ownership transition process as possible. Clearly, it’s not always feasible to find someone quickly. But, when it is, giving yourself plenty of time to mentor your successor and integrate the key objectives of your business plan will increase the likelihood of a smooth transition and make his or her job much easier after you’ve left. 

Company owners interested in learning more about mentoring efforts and transition strategies can contact Sikich for guidance and knowledge on this topic. 

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

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