Succession Planning: The Benefits of Creating Your Business with the End in Mind

Looking toward the long-term sustainability of your business will actually help you create a stronger company now

BY LUANN NIGARA

We don’t typically go into business planning for the end of that business. For most of us, our business comes from a passion. When we launch a business, we’re bringing fire, energy, spirit and momentum. The furthest thing from our minds is closing the chapter on that same business.

But experienced business owners, expert coaches and advisors know that businesses do end. Even if right now you are certain that you will be a window treatment professional or interior designer for the rest of your life, there’s a chance that won’t happen. Life changes, circumstances come up and the unforeseeable happens. And, presumably, most of you will look to retire at some point.

This is something we have been talking about at Window Works for the last several years: We need to plan for the end of the era of me, Vin and Billy, even if the end is nowhere in sight. And, as of late, it has been coming up among my colleagues at Exciting Windows! Thinking about how hard we’ve all worked, how much we’ve all put into our businesses and what the future holds beyond our direct involvement is leading us to big questions and tough decisions.

One of those big questions, and one you might ask yourself if you haven’t already, is whether you are creating something temporary or building a legacy. For us, at about year 10, we decided we were creating a legacy. Our business matters to us now and it matters to us that it lives on after us. If you are creating a profitable business with a strong legacy, then you must put in the work now to make sure that the business will go on without you. Succession planning can seem elusive and a bit overwhelming but it doesn’t have to be. Like everything else we do in business, we need to have a go-to expert to help with the nitty-gritty. As we faced this challenge at Window Works, we turned to my cousin, Eileen Hahn, who lists leadership development and continuity among her many skills. When I reached out to Eileen, I expected to get some valuable insight on succession planning. What I didn’t expect to hear was that a big shift is happening in terms of what succession planning even looks like and how to fold it into your business.

What should succession planning look like for small businesses?

The traditional thought process on succession planning is to wait until you need or want to get out. Then, you figure out if you are passing on the business to family or selling, and build an exit plan around that.

But according to Eileen, businesses today are evolving their thoughts on succession planning to instead focus on long-term leadership continuity that ensures the health and prosperity of the business. Developing, training, coaching and assessing leaders within the organization is part of the fabric of what high-performing organizations are doing on a continuous basis with an annual review

of leadership talent.They are also actively engaging in leadership continuity activities to continue growing leaders from within the business.

In other words, succession planning isn’t just a one-off event. We can take a different, stronger approach to build a team that can take over when we decide to step back or step away.

Truthfully, this approach has been much easier to digest mentally. We have learned that this view of succession planning ties more closely into what we do every day, the way we grow and scale our business, and all the decisions we are making along the way.

If the need for succession planning feels too far off to you, this could be the answer to being prepared while building a strong business along the way.

What are the best practices for succession planning?

If we’re going to take this more comprehensive approach to succession planning, we need to establish how to do it. Eileen had several ideas for best practices to share. First of all, the process should be led by the CEO and an engaged, committed executive committee. There should be broad communication and transparency with employees regarding what is happening with succession management.

Identify key positions in your business—both professional needs and leadership roles that must be filled. Make sure you align your professional and leadership capabilities with your business strategy and goals. Then, clarify what skills and competencies are needed for a given role and create an objective assessment of potential successors based on criteria and assessments.

One of the things you will likely find during this process are some gaps in current professional skills and leadership roles. Implement development programs tied to closing those individual succession gaps by providing targeted leadership development activities with follow-up and assessment. Keep in mind that creating a culture of sharing talent, encouraging leadership and empowering people to continuously learn new things can help with this in a more informal way than targeted training. Establish a measurement strategy so you have a clear, unbiased way of giving people feedback on their progress. Make sure that you hold leaders, not just individuals, accountable for developing people and potential successors.

This may seem like a massive undertaking, but when you dive a bit deeper into it, you realize that best practices for succession planning and best practices for running your business have an awful lot in common. Ideas like creating a culture of sharing and leadership and leading by example are things that we should be doing from the moment we bring on the first employee.

Beyond that, the best practices here are very similar to best practices for hiring. You determine what needs to be done and create an objective measurement of potential successors. From there, you figure out what needs to be strengthened within your company between now and the time they’ll take over, and you offer professional development to help get your successors there.

If we can view succession planning in this light, it feels natural and intuitive. It doesn’t have to be something that gets in the way of your business. It can go hand in hand with helping your business thrive.

What are some common problems that come up in succession planning?

Eileen also walked me through some common issues that pop up in succession planning and how to avoid them. We have experienced some of these firsthand. Like anything worth doing, it is not an easy process and it does take determination and commitment above and beyond what you anticipate you will need.

Problem #1: The principal/ CEO is not fully committed to succession

He/she is not leading and championing the process. Someone else in the organization is pushing this agenda and the principal/ CEO has not fully bought in. Sometimes the principal/CEO says they are bought in, but their actions don’t reflect that. Sometimes, the principal/CEO starts off thinking they want to go in that direction but realizes once

Succession Planning: The Benefits of Creating Your Business with the End in Mind

Looking toward the long-term sustainability of your business will actually help you create a stronger company now

We don’t typically go

into business planning for the end of that business. For most of us, our business comes from a passion. When we launch a business, we’re bringing fire, energy, spirit and momentum. The furthest thing from our minds is closing the chapter on that same business.

But experienced business owners, expert coaches and advisors know that businesses do end. Even if right now you are certain that you will be a window treatment professional or interior designer for the rest of your life, there’s a chance that won’t happen. Life changes, circumstances come up and the unforeseeable happens. And, presumably, most of you will look to retire at some point.

This is something we have been talking about at Window Works for the last several years: We need to plan for the end of the era of me, Vin and Billy, even if the end is nowhere in sight. And, as of late, it has been coming up among my colleagues at Exciting Windows! Thinking about how hard we’ve all worked, how much we’ve all put into our businesses and what the future holds beyond our direct involvement is leading us to big questions and tough decisions.

One of those big questions, and one you might ask yourself if you haven’t already, is whether you are creating something temporary or building a legacy. For us, at about year 10, we decided we were creating a legacy. Our business matters to us now and it matters to us that it lives on after us. If you are creating a profitable business with a strong legacy, then you must put in the work now to make sure that the business will go on without you.

Succession planning can seem elusive and a bit overwhelming but it doesn’t have to be. Like everything else we do in business, we need to have a go-to expert to help with the nitty-gritty. As we faced this challenge at Window Works, we turned to my cousin, Eileen Hahn, who lists leadership development and continuity among her many skills. When I reached out to Eileen, I expected to get some valuable insight on succession planning. What I didn’t expect to hear was that a big shift is happening in terms of what succession planning even looks like and how to fold it into your business.

What should succession planning look like for small businesses?

The traditional thought process on succession planning is to wait until you need or want to get out. Then, you figure out if you are passing on the business to family or selling, and build an exit plan around that.

But according to Eileen, businesses today are evolving their thoughts on succession planning to instead focus on long-term leadership continuity that ensures the health and prosperity of the business. Developing, training, coaching and assessing leaders within the organization is part of the fabric of what high-performing organizations are doing on a continuous basis with an annual review

of leadership talent. They are also actively engaging in leadership continuity activities to continue growing leaders from within the business.

In other words, succession planning isn’t just a one-off event. We can take a different, stronger approach to build a team that can take over when we decide to step back or step away.

Truthfully, this approach has been much easier to digest mentally. We have learned that this view of succession planning ties more closely into what we do every day, the way we grow and scale our business, and all the decisions we are making along the way.

If the need for succession planning feels too far off to you, this could be the answer to being prepared while building a strong business along the way.

What are the best practices for succession planning?

If we’re going to take this more comprehensive approach to succession planning, we need to establish how to do it. Eileen had several ideas for best practices to share. First of all, the process should be led by the CEO and an engaged, committed executive committee. There should be broad communication and transparency with employees regarding what is happening with succession management.

Identify key positions in your business—both professional needs and leadership roles that must be filled. Make sure you align your professional and leadership capabilities with your business strategy and goals. Then, clarify what skills and competencies are needed for a given role and create an objective assessment of potential successors based on criteria and assessments.

One of the things you will likely find during this process are some gaps in current professional skills and leadership roles. Implement development programs tied to closing those individual succession gaps by providing targeted leadership development activities with follow-up and assessment. Keep in mind that creating a culture of sharing talent, encouraging leadership and empowering people to continuously learn new things can help with this in a more informal way than targeted training.

Establish a measurement strategy so you have a clear, unbiased way of giving people feedback on their progress. Make sure that you hold leaders, not just individuals, accountable for developing people and potential successors.

This may seem like a massive undertaking, but when you dive a bit deeper into it, you realize that best practices for succession planning and best practices for running your business have an awful lot in common. Ideas like creating a culture of sharing and leadership and leading by example are things that we should be doing from the moment we bring on the first employee.

Beyond that, the best practices here are very similar to best practices for hiring. You determine what needs to be done and create an objective measurement of potential successors. From there, you figure out what needs to be strengthened within your company between now and the time they’ll take over, and you offer professional development to help get your successors there.

If we can view succession planning in this light, it feels natural and intuitive. It doesn’t have to be something that gets in the way of your business. It can go hand in hand with helping your business thrive.

What are some common problems that come up in succession planning?

Eileen also walked me through some common issues that pop up in succession planning and how to avoid them. We have experienced some of these firsthand. Like anything worth doing, it is not an easy process and it does take determination and commitment above and beyond what you anticipate you will need.

Problem #1: The principal/ CEO is not fully committed to succession

He/she is not leading and championing the process. Someone else in the organization is pushing this agenda and the principal/ CEO has not fully bought in. Sometimes the principal/CEO says they are bought in, but their actions don’t reflect that. Sometimes, the principal/CEO starts off thinking they want to go in that direction but realizes once