Like finding an incomplete will, it's really too late for succession planning if you've waited until the company president dies.
Before the funeral is over, people are vying for control. Some distant relation will suddenly appear with a forgotten claim. And who invited the taxman?
Dying is hard enough, but you can make it a little easier by planning ahead for succession in your company. It starts at the top.
High Potential v. Everyone
It's a good idea to have a list of potential successors because it gives the company more options, conserves resources in training, and rewards those who rise to the occasion.
However, it is also a good idea to keep the list open for others who may be overlooked. "Most successful organization focus on everyone," says Dan Schneider, cultural architect at advisory firm The Rawls Group.
Hiring Inside or Outside
According to studies, external hires are 61 percent more likely to be laid off or fired. And 21 percent are more likely to quit than internal hires.
Of course, a company may want to change direction in ways that require an outside perspective or skills. In those cases, it may be better to fish outside the company pool.
Family and Consultants
Family businesses tend to follow family organizations, with retiring members bequeathing leadership to their eldest children. This can be a tough choice, especially when a younger sibling may be a better choice.
A consultant can help through his delicate transition, giving the family an objective basis for succession planning. But the process of grooming a replacement should take time for the whole family to get on board.