Public companies are controlled by a board of directors, who collectively have a fiduciary duty to appoint a successor and devise a training schedule, because this is in the best interest of the company’s shareholders. Large private companies are under less scrutiny but they too must sooner or later announce a successor if they want to maintain the confidence of their employees and customers.
Home business owners however, are under no such obligation. The small scale of their operation, coupled with the fact that the only other employees, if any exist, are likely to be family, largely pushes the question of a successor to the back burner. But is this necessarily the best thing for the business or its owner?
Naming and training a successor ensures that the legacy of the business will carry on long after the current owner has passed away and this can act as a type of insurance for the family and can even help the business to grow.
There are several factors to take into account when choosing a successor. For instance;
* Does the Successor Have the Technical Skill?
* Does the Successor Have the Managerial Skill?
* Is the Successor Interested and Willing to Take on the Responsibility?
These are all important considerations and they will be looked at in turn.
Does the Successor Have the Technical Skill?
This is extremely important but especially if the business is dependant on this skill to maintain its market share. Appointing someone that is deficient will cause the quality to slide and slowly but surely all the hard work that was put in to the business will be evaporated because the wrong decision was made.
Does the Successor Have the Managerial Skill?
Apart from technical know-how, which at the end of the day can be outsourced, managerial skill is central to the continuity of the business. The chosen person must have the wherewithal to make the hard decisions and they must also be well respected for the transition to be successful. Putting a plan in place long before the actual hand over can help to lessen the blow and give others time to get to know the new replacement. This kind of relationship is important in home businesses because they operate on a much more personal level.
Is the Successor Interested and Willing to Take on the Responsibility?
The responsibility must not be thrust on an unwilling participant; otherwise it will be doomed to failure. The person that is selected must be exited to accept the baton if they are going to demand the respect and loyalty of those they serve.
Choosing a successor for a home business may not be one of the things that is at the forefront of the entrepreneur’s mind, but putting things like this in place can help to set a path not just for the business, but for the owner as well.