How to choose a successor: what qualities should he have?
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Deciding on a successor to take over running your business is one of the most important decisions that a company will make. Oddly it is one that a lot of companies put very little thought into. The right successor should be somebody who is capable of growing the business, finding this person can be a challenge.
One of the biggest challenges that small to medium sized businesses face when it comes to choosing a successor is that in most cases the person running the business is also the owner of the company. That means that you have to decide not only on who is going to be running the company in the future but also who is going to own the company. This can be tricky since the natural choice is usually to pass it on to one of your children. However there is no guarantee that your child will be capable of running the business.
There are a lot of companies that pass successfully from one generation of the family to the next with no problems. However this is fairly rare is the majority of family owned businesses do not make it past the second generation. If you are going to pass on both the ownership and management of the business to a family member you are going to have to make sure that the person you are passing it to is both trained and capable of running the business. It is also important to make sure that they actually want to run the business and are not just doing it out of a sense of obligation.
In most cases you will find that a better option for succession is to bring in somebody else to run the company. This will ensure that you have somebody who is actually capable of doing the job and who actually wants to do it. Bringing in somebody else will also help to ensure that you have somebody who will be able to run the company in the future.
Most businesses will eventually reach the point where the person who established the company is not really the best option for running the company. This is where you are going to want to bring in more professional management. It is also one of the main reasons that family businesses usually do not survive. A business has to grow in order to survive but as it grows the way that it operates will need to change. If the person taking over the business does things exactly the way that the founder did it is unlikely that they will be able to handle the new challenges in the future. This is why when you are planning for succession you need to make sure that you choose a somebody who will have the skills required to run the company the way that it will be in the future.