The Most Common Mistakes Business Owners Make When Planning for Succession
All successful business owners know how to plan. To that end, they should have a succession plan established as part of their estate planning. However, when executed poorly, succession planning can make matters more stressful and chaotic — rather than easier — for a business owner.
The following are a few of the most common mistakes business owners make during the succession planning process (and how you can avoid them):
- Favoritism: Your chosen successor should not simply be the person you like the most, and you should not automatically pick your oldest child. Start by identifying the people who have the skills and capabilities needed to run a company and begin training them in various aspects of the business, moving them around in certain roles and responsibilities.
- Not seeking help: You should never feel like the succession planning process rests entirely on your shoulders or that you need to keep it a secret. Seek assistance and input from other people within your company, as well. Transparency can help people manage their expectations and effectively plan, making for a smoother transition.
- Looking at your successor as a competitor: If you are choosing your successor, this should hopefully not be an issue. However, there are circumstances in which a person who knows who is to be his or her successor can feel threatened. This is the person who has been chosen to guide your business long into the future. The long-term health and viability of your company depends on your ability to smoothly transition the responsibilities over to that individual.
For more tips and guidance on how to properly plan for succession in your business, contact a trusted Florida estate planning lawyer with The Charles Law Offices.