Succession Planning

Succession planning is the process whereby the current owners of a business plan for a time when they are unable to fulfil the same roles currently undertaken today. This can be difficult to fathom but is a reality we all face.

The objective is to have a documented plan covering off on steps to be taken at various stages in the life of the business. The plan will highlight the key personnel and roles within the current business. It will then consider persons both internal and external to the business with the ability to fulfil these roles. Some of the things that may be considered are as follows:

  1. What are the attributes required of a person to fulfil the required roles?
  2. Who are the potential persons available to the business? Are they already working in the business or will they need to be head hunted externally?
  3. What type of training will potential successors need to be able to take on key roles in the future?
  4. How long will it take before these persons can take on the required position?
  5. What needs to be done to ensure potential successors do not leave the business prior to the full implementation of the succession plan. How are things communicated to them? How will they be remunerated?
  6. What is the time line for the succession plan?
  7. Are there any tax consequences to be considered?

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