Accounting / Choosing a Successor: Eight Tips

Choosing a Successor: Eight Tips

It’s not easy to decide to step down from your position leading a company. But when the time is right and the decision must be made, how do you choose who should lead your business into the future?

  1. It is essential to have a vision for the future. For your business to succeed in the future, you have to assess where you want the company to go. Should the company culture remain the same? Should the company grow vertically or horizontally? Will it need to be restructured in order to remain competitive? Is it possible that AI will impact how the business will evolve? Exploring these questions and others like them will help you create a list of qualities you want your successor to have.
  2. It is important to recognize that the person you choose will not be your clone. While the person you choose should have the business’s best interests at the core of their decisions, they will be making choices based on the circumstances and facts that are relevant to situations you can’t anticipate. Does the person share your values and philosophies and your belief in the company, even if those qualities are expressed or modeled in a way that differs from yours?
  3. If you believe that the best person to assume your leadership position is a family member, there is one question you must consider: Is that person truly the best choice or are you making an emotional and sentimental decision?
  4. You will no doubt choose someone with experience, but remember that experience encompasses two key areas: industry experience and leadership experience. Is the person you are considering stronger in one than the other? Will they be able to grow the weaker skill?
  5. Good communication skills are critically important these days — so much so that they almost should be at the top of the list of eligibility criteria. Today’s employees expect transparency, so you should ask yourself whether your proposed successor will be able to honestly and openly explain any changes they are making with good reasons for those changes.
  6. On the more practical side, the first place to start looking for your possible successor is inside the company. Promoting someone who has proven themselves can be a benefit because they know the ins and outs of how the business works. Even though they will have their own perspective on the company and how it should work, they will have regard for what you did as a leader, fit their choices into your work and extend what you started.
  7. It’s both practical and important to create a timeline for choosing and training your successor, which can help ensure their success. However, the decision and the work have both emotional and practical elements. How will you impart knowledge of the business’s internal workings at the same time you are giving the newly named company leader the latitude to show their own personality and management style? How will you transition from decision-maker to adviser to emeritus/a?
  8. A final practical detail, if the business is organized as other than a sole proprietorship, is to check all legal documents to ensure you are in compliance with them.

How BlueStone Services Can Help

If you’re not sure where to begin with succession planning, our experienced professionals can help you get started. Contact us today to solidify the legacy of your business.

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