Resolute forward planning for corporate succession
Enterprises suffer crises when conflicts of interest are mismanaged between shareholders, or when the death of the senior manager creates a vacuum. Problems of inheritance may divide family shareholders, or the founder’s wishes may no longer be respected. Succession planning is a vital necessity, with or without transition management. An independent secretary working with a caretaker Board may be needed to organize the transition, if there is no major shareholder to play a leading role.
Company owners, officers and senior executives tend to postpone succession planning. They rightly fear conflict between those who aspire to take their places. Or they may genuinely be unable to imagine how the company can do without them. Only a formal succession plan, drawn up and accepted by all, can ensure smooth transfer of powers.
Action must be taken in good time to ensure that the right training and preparation. If need be, existing business practice is called into question.
Longer preparation time may be needed when the successor is from the younger generation and new to the company. A company’s succession planning, depending on its size, may involve the senior manager alone or the whole management team. The aim is to ensure the company keeps its critically important skills.
A fundamental condition of successful succession planning is its formal acceptance by the Board and senior management. The chances of a smooth handover are all the greater if the stakeholders know when the current senior manager is leaving, and who is the replacement.
TIDO expertise here is invaluable. We help ease the handover of responsibilities by anticipating the future and taking into full consideration the risk factors, so that changeover at senior management level takes place not only smoothly but by stages.