Three Recommendations For Finding Success Through Transition
One thing a transitional event like a pandemic should teach all multi-unit franchisees is the importance of working on your business to address the potential, possible, and probable issues impacting your organization - also known as "Succession Planning." When the unexpected happens, only a commitment to working on your business can ensure you have protected your vision, goals, and wishes for the future of your company, and any family involved in the business. As we continue to navigate Covid-19, can you answer confidently that you have done this?
It is true the phrase "succession planning" has built a reputation related to exiting the business or worse, death of the owner. We understand all too well that when succession planning is recommended it is assumed you are not "there yet," so a common phrase we hear is "I'm not ready yet." Reasons we hear from business owners are typically the same. Not ready to retire, not wanting to exit the business yet, health is perfectly fine, we are in a growth mode, or the best one, that nothing is going to happen to them.
The reality is that succession planning is not just about the end or the individual in charge of the business. It is about sustaining the business through transition, the next generation of ownership, or through the demands that growth places on the business. Covid-19 has proven that you can be in perfect health, nowhere near retirement, and that you are perfectly well to run the business, but the environment around you has changed everything. Some multi-unit franchisees are doing better than ever, whereas some are struggling to stay afloat. Regardless of your situation, here are three recommendations to get you kick-started into finding success through transition:
- Identify a potential successor. This tends to be one of the most challenging for business owners. For some reason there is fear in that you are putting your own mortality to the test. When really what you are doing is identifying someone who can partner with you to run the organization until you choose it is time to devote your time and energy in other areas. Covid-19 has shown us that as business owners we need to pivot and flex into different areas (i.e. PPP or understanding reopening guidelines/safety procedures) to ensure our business can keep running. In these times, having someone to come in and run your day-to-day operations who has been groomed by you is critical. You are guaranteed they will run the business with your goals and vision in mind. The reason is simple; you are investing in them for the future of the business, and therefore, they are loyal in return.
- Involve potential successor in the decision-making process. Once you have determined who can be your right-hand person, bring them into the decision-making process. Let them see you at work and the steps you take when making the tough decisions. Ask them for input and get them engaged. This does not mean you are giving up control. It allows you more input and thought, and to empower your potential successor to feel as if they have "skin in the game".
- Include potential succession in financial reviews. This is another area where multi-unit franchisees can get stuck. Sharing financials can feel vulnerable and sometimes make you feel like you are peeling back too many layers of the onion. However, this perspective provides another layer of knowledge and buy-in to your potential successor. They must understand what the numbers look like, the impact of decisions, and what they are working for and towards in order to ensure your goals, vision, and financial future are met.
Succession planning provides a beginning and a path forward to overcome obvious and hidden obstacles. We challenge you to spin it around and consider how succession planning can help ensure you protect your "now" and your future. When something like Covid-19 hits we cannot predict the impacts to our business, our people, or our communities. But what we can do is start to lay the foundation to have the tools to be agile in the face of the unknown.
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