Many entrepreneurs would like to sell their business, either internally or externally. Some will succeed in this type of transfer THE OSTRICH, but for many managers of San Diego SMEs, the integration of succession within the company remains one of the most realistic avenues. Do you have a progression plan for your business? Did you include it in your shareholder agreement? Are you aware of this issue? Does the concern arise?
DEVELOP A CULTURE OF INTEGRATION
To integrate a young succession that can ensure the future and the sustainability of the organization, and, for several decades, it is necessary to be able to develop a culture of integration, that is to say, to train future shareholders to think like current managers, to ensure that they adopt the values of the company that have led it to success, in short, to give them time to immerse themselves in the M&A advisory culture of the company.
Integration must be the primary objective of the entrepreneur seeking to establish succession within the company.
BETTER SOON THAN NEVER
For a real business succession to emerge, it is essential to integrate strong personalities who demonstrate leadership and vision. Too often, leaders wait before beginning the process of identification, recruitment, and integration, even if they feel the need to do so to some extent.
Others are not aware of the importance of having a welcoming structure that promotes the next generation or even does not care about the sustainability of their business. Sometimes it’s just too late, especially when health issues plague late-career entrepreneurs.
We must start earlier to target and eventually hire these rare pearls who will breathe new life into the M&A advisor of the company. Several years are generally required for integration. Thinking about it a year or two before the changing of the guard is usually not enough to prepare and get this succession to think like business owners. Also, when the company is not balanced in terms of age groups, the impact of the transition can be major on the culture of the company, hence the importance of starting early.
GAME PLAN
As part of succession planning, you must first establish with the current shareholders what the eligibility criteria for the succession program will be. The criteria must be established within the company’s senior lean management to have a clear vision of the succession strategy. Recruit the right candidates from well-defined profiles, carry out the appropriate assessments and psychometric tests, and finally, integrate newcomers.
In some cases, some restructuring will have to be planned and even some cleaning up in the less efficient sectors. Making sure you have the right people in the right places is also part of the succession solution.
AN INVESTMENT
The integration of succession increases the value of a company. First and foremost, you need to be aware of the financial benefits of a well-organized succession. It all starts with the entrepreneur’s desire to set up a structured integration program. Regardless of the industry in which the company operates, the same benchmarks apply, and the concepts remain the same.
Integration maximizes business value and performance while operating at full capacity. A succession that integrates effectively allows the entrepreneur to create wealth and value to sell and withdraw positively. Also, the arrival of new partners ultimately increases the chances of selling successfully THE OSTRICH. This is often an opportunity to slim down the business and demonstrate efficiency by presenting two or three good financial years.
Too often, the entrepreneur improvises or is unfortunately forced to sell at the worst possible time due to age, illness, discouragement, or other difficult conditions. Without a succession plan, it will be difficult to sell favorably before a horizon of two or three years.
DON’T PLAY OSTRICH
We have talked about it; many entrepreneurs are not aware of the challenge that awaits them and do not devote the time necessary to sound succession planning. Often the fear of change, the fear of sharing income and information. The fear of seeing employees ask for raises, the fear of opening the books and expense accounts.
Dear entrepreneurs, do not play the ostrich. Don’t hide your head in the sand and above all. Don’t wait until you’re in trouble before opening the door to your successors. Begin today with the exercise of planning and integrating a young and promising succession for the business you have built. Do not hesitate to consult your notary in business law to guide you and accompany you strategically.
The consultation will allow you to take stock. Set up strategic watch mechanisms to identify entrepreneurs. And work on training and on the weak points of the. Company to make it attractive to future young entrepreneurs.
Some are waiting for the signal, especially with the new generation of talent ready to knock on your doors. It may be important to inform them of the opportunities available to them to participate in the shareholding of THE OSTRICH. Communicating based on the objective criteria and measurable expectations. You will have to surround yourself well.
