Every day, there are stories in the media discussing the importance of succession planning, yet many of us business owners aren't paying heed. According to a global study released by Korn Ferry International, "40% or less of organizations today have a capable CEO-in-waiting." Also, according to a report released June 13, 2005 by the Canadian Federation of Independent Business (CFIB), four out of ten small to medium-sized business owners intend to retire and exit their businesses within five years. This number is expected to increase to seven in ten over the next ten years. In addition, the CFIB report states that only 35% of these business owners has any type of succession plan. What I find most troubling about this is, those who do have a succession plan, most often have an informal, unwritten plan that has not been shared with the intended successor!

So, do we really need a succession plan? Yes. Take a look at what McDonald's experienced in 2004. Their CEO, Jim Cantalupo died suddenly of a heart attack in early 2004. Because they had a solid succession plan in place, Charlie Bell was named CEO the next day, and their stock price rose -- because this incredibly smooth transition, in the face of disaster, calmed the investment markets. (If they can handle this type of crisis with such aplomb, they certainly can handle other business issues well too...) However, Mr. Bell was diagnosed with terminal cancer in November and died shortly thereafter, so Vice Chair Jim Skinner took over as CEO. Again, this transition had minimal disruption to the corporation in the face of yet another tragedy.

OK, but does this apply to you and me since our companies are far from being global enterprises like McDonald's? It applies to us as well. This is not an exercise reserved for the large conglomerates. What would happen to your business if you were involved in a tragic accident after you left work today? You are injured so seriously - or worse - that you will never return to work. What will happen to your company? If your answer is: "My business would close" or "I don't even what to think about that," you need to think about succession planning. I've experienced personally and professionally, sudden tragic losses of family members, business colleagues, and friends because of illnesses and fatal accidents. No one likes to think about tragic situations, but they do occur and it'd be nice to allow your business to continue to provide for your employees, customers, and vendors alike.

However, succession planning need not just address the tragic situations. It most often addresses the natural attrition of staff. We baby-boomers are edging ever-closer to retirement. We hold most of the senior spots in management and other key positions within our organizations. Who are we training as our replacements as we and others on our team retire, move into new positions, or leave our organizations? Succession planning also, is not an exercise to just focus on the top spots. It's also an exercise to ensure that key positions throughout the organization have replacements in-the-pipeline learning the ropes and gaining relevant experience so they can take over when we and others leave.

If I've made you a believer on its necessity, here are a few Succession Planning pointers to make this project a bit easier and more successful:

1. Ensure the CEO/Senior Management team is intimately involved and supportive

2. Link the Succession Plan directly to the Strategic Plan

3. Continuously monitor the Plan and the development of staff in-the-pipeline

4. Combine work experience, training, mentoring, special assignments, and web-based activities for future organizational leaders

5. Keep the plan as simple and straight-forward as possible.

If you've taken the time to plan your company's finances, marketing efforts, production practices, and sourcing tactics, why haven't you planned for its future staff and leadership? It's time to start your next big project.

Copyright 2008 - Liz Weber of Weber Business Services, LLC.
Liz speaks, consults, and trains on Leadership Development, Strategic Planning, and Organizational Change. Additional articles can be found at http://www.wbsllc.com/leadership.shtml
Liz can be reached at liz@wbsllc.com or (717)597-8890

Permission to reprint this article is granted as long as you use the complete attribution above - including live website link and e-mail address - and you send me an email at liz@wbsllc.com to let me know where the article will be published.

Author's Bio: 

In the words of one client, "Liz Weber will help you see opportunities you never knew existed."

A sought-after consultant, speaker, and seminar/workshop presenter, Liz is known for her candor, insights, and her ability to make the complex "easy." She creates clarity for her audiences during her results-oriented presentations and training sessions.

Participants walk away from her sessions knowing how to implement the ideas she's shared not just once, but over and over to ensure continuous improvement and management growth and development.

This former Dragon Lady has been there, done it, and learned from it. Whether speaking to corporate executives or government agency personnel, Liz's comments and insights ring true.

As the President of Weber Business Services, LLC, a management consulting, training, and speaking firm headquartered near Harrisburg, PA, Liz and her team of consultants provide strategic and succession planning, management policy & systems development, employee training, as well as marketing and media outreach services.

Liz has supervised business activities in 139 countries and has consulted with organizations in over 20 countries. She has designed and facilitated conferences from Bangkok to Bonn and Tokyo to Tunis. Liz has taught for the Johns Hopkins University's Graduate School of Continuing Studies and currently teaches with the Georgetown University's Senior Executive Leadership Program.

Liz is the author of 'Leading From the Manager's Corner', and 'Don't Let 'Em Treat You Like a Girl - A Woman's Guide to Leadership Success (Tips from the Guys)'. Her 'Manager's Corner' column appears monthly in several trade publications and association newsletters.