Tuesday 23 September 2014

Planning For The Future

What happens next?

This is the question that should be on the lips of everyone from the Board of Directors right down to the sole proprietor of a small business.

For some, the answer is easy - for example “I close the business, transfer the bank balance to my personal account and retire!”  Others say “My son/daughter will take over.”  For others, it’s too awkward to think about/too early to think about/will take care of itself or some other such excuse.

It’s not easy.  You need to think.  You need to look at all the possible “stakeholders” of your business.  These include (but aren’t limited to):
  • The business itself
  • Your staff
  • Customers
  • Suppliers
  • Utility companies
  • Professional advisers (lawyers and accountants)
  • The Tax Man
  • Banks
  • The community at large
  • The press
  • Markets

I’ve seen small business owners send their children to study for an MBA, thinking that this will help them manage the business better once Mum/Dad has gone.  The son/daughter returns but decides that they want nothing to do with the business.   Worse, they want to change the way things are done!

At the other end, blue chip companies hire seemingly well-qualified CEOs only to find that they’ve made a terrible mistake.

The first thing to remember is that often it’s the current owner/CEO/Lead Partner/Chairman/Woman who is trusted by/has the confidence of many of the stakeholders.  Will their successor command the same trust/confidence?  If your bank or suppliers don’t see your successor as a “good paymaster”, how will that affect the business going forward?

Secondly, where’s the business going?  If you’re hiring a new CEO and you need someone who can lead the company through a turnaround, then hiring someone who specialises in closing down businesses isn’t the best thing to do (unless this requires closing down a number of loss-making divisions).

Many companies (for “corporate governance reasons”) hire from outside.  Sometimes this works, sometimes it doesn’t.  The new manager(s) need to be able to connect with the ethos of the company, and this is where things go wrong.  In the eyes of staff, customers, suppliers and others, they just don’t “get it”.  Make sure that the new entrant understands what makes your business tick and why it’s so successful.  Sometimes, it’s better to hire someone from the “inside”.

Among the questions that you should ask are:
  • What makes the organisation successful?
  • Where is it at the present stage (growing, shrinking, re-focusing, etc)?
  • What does the job need?
  • Who do we already have who can be groomed for the position?
  • What additional skills will he/she need to learn?
  • How long do we have?
  • Which stakeholders need to be involved?

Don’t leave it until it’s “too late”.


I have spent more than half my life delivering change in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy to offer solutions for improving performance, productivity and risk management.  I work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by email . My website provides a full picture of my portfolio of services.  For strategic questions that you should be asking yourself, follow me at @wkm610.

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posted by William Martin @ 08:28

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