Don’t Leave Your Company Vulnerable
Now, more than ever before, it is important for an organization to plan for the future. With no succession plan in place, the continuation of the business is threatened. Successors, which would typically be found in the 45-54 age range, are dwindling. If a leader or key executive resigns or becomes incapacitated without having a plan in place, the search for a replacement could cause:
- internal strife
- loss of product and process knowledge
- customer dissatisfaction
- decrease in employee morale
Ultimately, due to lack of planning, profitability and the future success of the business could be affected. Denial is not a business’ ally. Owners, leaders, and executives WILL exit their role at some time or another. Business survival during this transition depends on the level of preparedness.
Planning for the Future
Today, owners of family and closely held businesses must navigate through one of the toughest and most critical challenges they will face – planning for succession. Of the 22,800,000 family owned businesses in the United States today, roughly 28% have a succession strategy.
In Michigan, there are more than 200,000 family owned businesses which have no formal plan to carry on the owner’s mission and vision after they leave their business. In addition, only 35% of family owned businesses successfully make the transition to a second generation, resulting in many Michigan jobs becoming at risk. Other potential consequences could include:
- reduced performance
- increased employee turnover
- loss of market share
- irreparable reputational damage
- negative impact on employee morale
The development of a solid strategic and succession strategy is a critical part to ensuring that family owned businesses thrive and jobs stay in Michigan. Whether looking to sell the business or pass it on to the next generation, the successful execution of transition strategies helps business owners ensure growth, strengthens Michigan’s economy, and helps business owners gain the return on their lifetime investment. Are you ready?
MMTC can help minimize the vulnerability an organization faces when a key leader leaves – whether planned or not. To learn more about MMTC’s Succession Planning Solutions, call 888.414.6682 or email firstname.lastname@example.org.
Since 1991, MMTC has assisted Michigan’s small and medium-sized businesses compete and grow. Through personalized services fitted to meet the needs of clients, we develop more effective business leaders, drive product and process innovation, promote company-wide operational excellence and foster creative strategies for business growth and greater profitability. Find us at www.mmtc.org