The Five Elements of Good Succession Planning
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By Elaine Ervin, National Construction Practice Leader, and Dan Gaffney, National Wealth Services Practice Leader, Moss Adams LLP
An effective plan is an integrated and thorough one. You might focus on one area more than another at different points of the planning process, but if you only focus on one, such as estate planning, and never address the others, you may not be fully protecting your business and personal wealth.
- Business financial planning: securing and growing your company’s transferable value
- Personal financial planning: creating sufficient personal liquidity and net worth to fund your lifestyle and tend to your family’s needs and interests
- Management succession planning: developing key successors to enhance long-term performance, value, and transferability
- Estate planning: planning for the family legacy while helping to reduce the estate tax burden
- Ownership transition planning: structuring the transfer of the business to a successor
Five Questions to Ask Yourself
- Do you know your exit alternatives?
- If something happened tomorrow and you could no longer lead the company, who would?
- How will your management team execute your strategic plan effectively in your absence?
- How have you prepared your successors to fulfill your role in the business?
- When and how will you introduce your creditors to your successors?
For a more extensive article on building a succession plan for your business, visit http://www.constructormagazine.com/?p=576&preview=true.