Innovative Ways to Groom Your Successor(s)

You need to have peace of mind before you are going to turn over your business to someone else. Not every successor will be prepared for the job, and not every owner will do the work needed to prepare their successor. Your successor needs to be able to successfully lead the implementation of your strategic plan and directly or indirectly fill the gaps that arise when you are no longer active in the business. This gap analysis is crucial for every owner to do, even if the ramp down is years away. It will give you good insight as to what development planning your team will need. While your list may not be all encompassing, it will give any business and its successors a good start. Here are some ways to close the gaps.

Provide Powerful Experiences for Your C-Suite team

Experiences such as volunteer leadership positions, participating in roundtable discussions, and being a part of a strategic planning team will expose them to other ways of thinking, push them to step outside of their comfort zone, and expand their influence in the business community. A good friend of mine aspired to be the president of my Rotary club. When she was installed, she confided in me that she was terrified of speaking in public. Week 1 was tough for her. Week 2 was a tiny bit easier. By week 40 she was unscripted and putting everyone at ease.

Provide Learning Opportunities like ‘Reverse’ Training

We often think about getting trained in something we haven’t yet mastered, but instead, ask your leaders to train you, your leadership team, or a subset of your business — on something THEY need to learn and would be beneficial for others to learn too. When you have to train somebody else, you are forced to learn it better yourself. When I first was learning about P&L’s and balance sheets, I forced myself to do a small training event for a group of trusted advisors so I would learn more deeply. I had to be prepared not only to present the material, but I knew they would ask me challenging questions. I had to be ready for those too.

Other Learning Opportunities include being part of a pilot or SWAT team to take on a special, time limited project. Special projects usually provide cross-functional experience, demand fresh ways of problem solving, require relationship building with new team members and force the engagement of different skills.

Be an Intentional Role Model

Employees often thrive when they have an excellent boss and role model who will show them how things should be run, and explain the why behind it. I remember years ago when I worked in the packing department for Procter & Gamble’s Sure/Secret antiperspirant, my boss pulled me aside when he saw that we were dropping an occasional cap on the floor. Each cap only cost a penny and we had to throw them away if they hit the floor. What’s a penny every twenty minutes? Well, he sat down with me, did the math and that penny became thousands of dollars on a 180 cap per minute machine running 24/7/365. What a great learning experience.

Formal Training and Mentoring

Giving the successor a chance to attend specific classes, seminars, workshops and self study programs will give them a sturdy foundation upon which to grow their leadership skills. Encouraging them to find a mentor, will provide them with a guide for their development journey.

There are many other examples of ways to groom your successor that are effective AND get move the business ahead. Most are fairly inexpensive, require little time away from ‘the job’ and deliver broader benefits as other employees learn too. If you want to explore more, download our Growth & Development Planning Tools list. It has additional recommendations.

Leaving a business in the hands of someone you are not confident in is difficult, so investing in your C-Suite and beyond gives you a stronger business today and more choices on potential successors for tomorrow.

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Planning for Your Exit Before You Plan on Exiting

It may be years before you are ready to leave your business. You may absolutely love working, and can’t imagine retiring any time soon. Or maybe you want to exit, but you don’t have the financial resources to leave the business just yet. No matter which situation you find yourself in, it is inevitable that you will leave one day. Being prepared ahead of time is crucial to a successful exit from your business. Successful owners start thinking about their exit plan now – long before they plan on actually exiting. They start by building a successful business that has value to a buyer now! You can build your business two ways: One is defensive and one is offensive. Using a mixture of them both will enhance the quality of your business and ensure that your eventual exit will be a successful one.

Defensive: Although you may have no intention of exiting anytime soon, it is extremely important to “go on the defensive” and be prepared to exit at any time. You never know what the future will hold.

• The market could take a drastic turn for the better – or the worse, and it may be time to get out.
• An offer you cannot pass up may come along unexpectedly.
• Or in extreme cases, you could fall ill or disabled and unable to run the business

Sadly, we don’t live forever and none of us know when we are going to die. Knowing that your company will be able to function without you in the event of an emergency is important to saving the integrity of the business you worked so hard to build.

Offensive: “Offensively” speaking, you want your company to be one that thrives for a long time, especially after you exit. To ensure that:

• Put strong systems in place – financial, operational, sales, etc..
• Make strategic business decisions today. You’ll reduce risks and prepare your business to be more valuable before you leave.
• Build a strong management team
• Become less financially dependent on your business in the final years leading up to your exit are important things you can do to build a vibrant saleable business that people will want to buy.
• Look at the areas in your business that need improvement. Weak links could be detrimental to a profitable sale, so fix them now.
• Assess your strengths and build on them to increase the value of your company.

Get ahead of the game by planning for your exit now. There is no harm in being prepared many years in advance.

Learning that building a better company today and exit planning are the same thing will ensure that your exit will be a successful one.

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5 Ways To Prepare Your Leaders For Success

There is no doubt that applied knowledge and targeted experience is one of the keys to success. When employees gain the knowledge and experience they need for higher level roles before they get into the position, they are better positioned to lead into the future. Giving employees early leadership experiences and opportunities ensures the sustainability and future success of your business. How can you prepare your leaders for more responsibility?

1. Let them learn on the job. This means allowing them to make mistakes, recover and learn from them. It means expecting them to address issues directly and come up with creative, effective solutions. This helps them learn to think like an executive.
2. Give them “fix-it” or “turnaround” jobs. A stretch assignment will force them to problem solve, communicate across organizational boundaries, overcome obstacles and build effective relationships. They will learn to become more persuasive, tough, and influential.
3. Have them build something from scratch – start up a new project, build a new team. This will teach them resourcefulness, initiative, and tap into their creativity. If it’s a part of their current role, they will have to learn how to prioritize what is most important.
4. Encourage ‘a day in the life’ where you have your leaders switch positions with a colleague in a very different role. Encourage them to go deeper in the organization to see firsthand the challenges your team faces with ineffective systems, poor hand-offs, difficult people, dysfunctional communications, etc.. This exercise will expose them to your business in a very different way.
5. Expose them to the financials so they understand how you make money, what are your most profitable products, who are your most profitable customers, where do you have losses. Help them understand the impact of decisions on the bottom line.

Giving employees and potential successors these kinds of experiences long before they need to step into an ownership or management position is an invaluable way to groom a successor. Giving up control can be difficult, but their transition to effective leadership will be much smoother with these kinds of experiences.