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3 things you need to include in your business succession plan

On Behalf of | May 11, 2022 | Business Succession Planning |

Businesses can fail at any time, but major transitions are when an organization will be particularly vulnerable. The departure of an executive, manager or owner due to death, health issues, criminal prosecution or retirement doesn’t always mean that a business will go under, but sometimes it does.

As someone in a role of authority at the company, you can take steps now to help keep the business afloat when you leave eventually. By creating a succession plan and including all of the details below, you will help someone else be able to take over the company and run it as successfully as you have.

A snapshot of the current financial circumstances

Like an estate plan, a good succession plan requires frequent revisions and updates. Checking it every time there is a big change to the company or every few years will ensure it offers maximum protection.

You want to include up-to-date information about your company’s current operating expenses, expected revenue and financial obligations. The information you provide will serve as a crucial benchmark for the person taking over to see if the company is as financially healthy as it was under your control.

Training details not provided in company materials

While some of what your successor will do on the job will be in the standard company training manual, there will inevitably be information that only you know. Making sure that accurate records of website login information, vendor contacts and other details that no other workers have access to will ease the transition when someone takes over your position. Basically, you need to make a written record of company information that currently only exists within your mind.

Guidelines and suggestions for your replacement

Whether you have taken the time to offer hands-on training to one of your subordinates over the last few years or you expect the company to headhunt for talent from another business, your input about your replacement can be invaluable in the selection process. A combination of naming possible candidates and providing guidance about the criteria for a good successor will help ensure that someone who is capable of doing your job takes over your position when you leave the company.

Integrating all of the right details into your business succession plan will give the organization the best chance of succeeding even after you leave the business.