Small business success begins with careful planning for the future. That includes preparing for inevitable changes, both expected and unexpected, that your company may encounter. Business succession planning is aimed at just this.
The goal is to help companies adapt to a wide range of contingencies that may come their way. Designing and implementing a carefully drafted succession plan can protect your company’s interests. Our Houston business lawyers at the Oracle Legal Group can help your small business continue to excel, regardless of what the future brings.
What Is Business Succession Planning?
A business succession plan can be compared to an estate plan for a small business. Company leaders and owners, at some point, will experience major life changes that will impact the business. Examples include common events like retirement, death, and leaving the company for a new one.
Businesses should also get ready for unexpected occurrences such as sudden illness and incapacity. These can affect an owner’s or executive’s ability to do their job. Without a plan for what to do next, the company could end up in financial and legal peril.
The goal of adopting a business succession plan is to reduce the risks posed by these and other problems. A diligently drafted plan will set clear procedures and guidelines for steps the organization should take after certain events happen.
How Business Succession Planning Can Help Your Texas Small Business
While large corporations have substantial resources to weather just about any storm, small businesses usually don’t. They have fewer capable personnel who can step up to fill leadership gaps. Often, they have relatively thin profit margins to where a major disruption could prove financially devastating. The absence of a plan could have detrimental effects on the company’s health and future.
But a business succession plan can help avoid these problems in several ways, including:
Keeping Your Company Running
Without a plan, your business could grind to a halt if an owner or executive dies or leaves. A succession plan promotes continuity and avoids disruption.
Training the Next Generation of Leaders
Since smaller businesses have fewer people who can capably lead, the company should identify and train the ones who can. A succession plan sets guidelines and procedures for choosing the next generation of leadership.
Defusing Power Struggles
A small business without a succession plan could be plunged into an internal power struggle. The remaining owners and leaders may quarrel to decide who should run the company. A plan that identifies its future leaders, or creates steps for selecting them, is less likely to have this problem.
Conserving Valuable Company Resources
A plan negates the need for additional time and energy spent dealing with power struggles and the like. This allows the company to stay focused on growth and conserving its precious resources.
Protecting Important Traditions
Your company’s brand may be based on certain values and ways of conducting business. New leaders should recognize and preserve these traditions, and a succession plan can facilitate this.
Reassuring Stakeholders
Investors, loyal customers, and the community at large are key stakeholders in your small business. But they prefer stability and reliability. Enacting a succession plan reassures these groups that your business is prepared to address future challenges.
Count on the Oracle Legal Group to Help Your Business Plan For the Long Term
Small businesses have a trusted legal ally in the Oracle Legal Group. We are dedicated to helping you thrive, regardless of what the future holds. Let us review your small business objectives and needs, then develop a customized business succession plan to protect it.
Call us today at 832-291-2798 or use our online contact form to get started. We offer a free consultation.
