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29th Mar 2024
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No succession plan, no business future

by The Editor at 13:24 09/05/07 (News)
With Tony Blair due to step down as the UK Prime Minister any day now, succession planning is at the forefront of the country’s mind. In business, effecting a smooth transition from one owner or manager to another is one of the biggest concerns for entrepreneurs in the construction industry it is therefore vital to think carefully about how the changeover will take place and take time to ensure successions run smoothly.
Bibby Financial Services product development director Andrew Dixon, said: “Owners and managers that do not have a succession plan in place to help them prepare for retirement or the unexpected are gambling with the future of their business.

"While taking calculated risks is at the heart of every entrepreneurial company and successful entrepreneurs enjoy bending the rules and pushing the boundaries sometimes, by not taking the simple step of ensuring they have a good, well thought out succession plan they could be jeopardising their employee’s livelihoods and threatening the future of their firm.”

Top Tips
Bibby Financial Services has developed the following top tips to help owners and managers in the construction industry take the first steps to ensure they have an effective succession plan in place:

  • Delegate - Try to delegate responsibility and don’t put your eggs all in one basket. In business, it always makes sense to avoid being over-dependent on anything – be it a key individual, or an important client.

  • Plan - Always have a plan and start the planning process early so that you can carefully weigh up all the options and come to a decision that is best for your business and for you.

  • Successors - Consider potential successors on their individual merits and avoid appointing someone simply because they remind you of yourself. Consider the direction they will take the business and who you would be happy to take on the good name you have built up.

  • Family - If you want to keep your business in the family, family members should only be groomed for succession if they possess the appropriate skills and talent and want to do it. Many family businesses fail by the second or third generation of management because the passion for the business is simply not present.

  • Manage impact - Succession planning can’t happen in isolation and owners need to make sure that other activities within the business fit cohesively with their plans. Include human resource procedures, business development plans, and merger and acquisition activities in any succession plans.

  • Processes – Don’t keep everything in your head – document day to day responsibilities, policies and procedures so that a successor can pick up the reins easily.

  • Training - When you are ready to start grooming a successor, provide them with an on-the-job training programme that is relevant and will enable them to achieve their full potential while working alongside you to ‘learn the ropes’.

  • Set a date - If you are planning to retire soon, set a date and stick to it. This date should be far enough in advance to enable your successor and the rest of your employees to get ready for the transition.

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Susie Hughes
The Editor © Hardhatter 2007

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