The Best Time to Plan is When Things are Calm

By Bob Stewart

I’ve been thinking a lot about my own mortality lately. That’s probably because a number of people close to me have died. We so easily forget that the circle of life on this planet far too soon will no longer include us. Tempus fugit.

In the context of advising business owners, this realization reinforces for me the importance of planning ahead. Prepare yourself and your business for change. Although we can’t easily predict what change is next, we do know that change is inevitable. Those businesses that do best during times of change – at least relative to their competitors – are often those that have made contingency plans for possible changes they can predict, and those they cannot.

As my colleague Steve Coleman often says, “The best time to plan is when things are calm.” He is so right. Let me highlight a few predictable changes that every business will encounter and maybe identify some contingencies for which they can create plans, even if they never need to use them.

Transition Planning

Most business owners or CEOs I know hope their businesses will outlast them. But not every business owner plans for the transition. It is too easy to keep doing what they’ve been doing, sometimes justifying it by staying too busy to be able to work on a transition plan. Many have trouble separating themselves from their role as the leader of a business. But a sensible steward of that business will have two plans for business succession – one if the need for a new leader arises suddenly, and one that permits a more measured turning over of the reins.

As a leader, you must do this or risk doing a tremendous disservice to the business you have worked so hard to grow, and to its owners—whether that be just you, a larger group of owners or your heirs. You are not indispensable. None of us are. Prepare your successor. Train them. Trust them. Get out of their way, when the time is right. And remember, a strong board of directors and a sound governance structure are important when successfully transitioning to the next generation of leaders... MORE