After years of hard work running a business, many founders reach a point where they are either ready to take a step back, shift their focus completely or are simply too busy to do it all.
It may be that they have been busy working on the operational side of the business with no time to look at the bigger strategic picture, or it may be that they are bogged down in the minutiae of day-to-day tasks. Alternatively, it could simply be that they struggle to take any time off for holidays or spend time with their friends and family.
Founders often initially assume that they have to choose between carrying on regardless or selling up completely.
However there is an alternative which can see you step away gradually and manage succession in an orderly manner that suits both you and the business.
So how do you do it and what are the pitfalls to avoid?
Wearing fewer hats
First and foremost, it’s important to acknowledge that as founders often cover more than one function within their business, this can constrain growth. One of the primary goals of succession planning should therefore be removing this constraint and creating a business that has the potential to grow without having an over-reliance on just one person.
The best place to start is by looking critically at what the key roles are that need to be devolved to other members of the senior management team; it can be hard to let go and give others responsibility for key business functions but it isn’t possible to be part Finance Director, part Purchasing Manager and part Sales Coordinator forever! Once this has been done, you should then find that you can prioritise those areas where you can have the most impact on actually growing the business such as marketing or customer relations.
Finding the right people
Once you’ve identified these roles, you then need to hire the right people to fill them. The temptation is to look internally and promote from within and, while this can sometimes be the best option, it’s important to remain open minded and consider external options as well; sometimes a fresh pair of eyes can spot something that you and your immediate team may have missed.
Of course, finding the right people to take the business forward is not always down to hiring the best qualified candidate so it is important to think about how these people will fit within the business culture that you have created.
Finding employees to work alongside, or someone you would be happy to hand over the day-to-day running of the business to, can often be one of the hardest challenges of succession planning but it is important to remember that the chosen colleagues don’t have to be a mirror image of you and should instead be the sort of people who complement the wider team.
Defining your own role
Last but by no means least, make sure that you define a role for yourself; make the transition to this new position, change your job title so that colleagues know that things have changed and resist the temptation to slip back into your old habits. Trust the hiring decisions you’ve made and give people the responsibility and autonomy you promised them.
Ultimately, if the goal is to create a saleable and scalable business, building a proper succession plan, hiring good people and devolving certain areas of responsibility to others should provide your business with growth opportunities that you may not even have previously envisaged.
It’s not easy, and there are likely to be some bumps along the road, but executing a successful succession plan may be one of the best business decisions you will ever make.
Mo Aneese is an investment director at Livingbridge.