Successful tips in Handing Over the Business to the Next Gen

When the business is successful at a certain level, the entrepreneurs should start planning to find their successors. This is a crucial plan for all small, medium and large businesses. One concern is who will be the next successors and how to hand over the business to them flawlessly.

Selecting the business successors is not to select people who are similar to the current entrepreneurs. In fact, it is to select those who are ready to work immediately, gain acceptance, and can grow into the future for the organization. Before selecting the successors, start finding out the right answers to the following questions.

1. What potential should leaders have?

Some businesses need leaders with good personalities while some need those who are capable of analytical thinking or financial analysis. To identify leader potential, the entrepreneurs should consider business patterns and organization objectives as priorities.

2. Can the successor work effectively with the executive team?

The business succession will be failed if a new leader handles everything alone and lacks attention in the executive team. The consequence is that the new leader can’t gain acceptance from the working team.


3.Can the successor keep a good relationship with customers? 

This is a significant question as maintaining a relationship with customers is the core of running the business. If the successor can’t make it, the organization's profit may be affected and its business will be shaky.

4.What issues can a successor get authorization?

In some cases, the previous leader can still make an authorization decision on some issues. In some cases, all authorizations belong to the successor solely. Thus, communication should be thoroughly delivered to concerned parties before implementing the business succession.

5.Are employees in the organization ready to support the successor?

 This is another important question as the successor needs acceptance and support from teamwork. If things don’t go well as expected, the business succession will be failed and the future of that business will then be at risk.

A Smooth Business Handover

1. Define precise timing for the business handover

To develop the handover plan appropriately and to be in accordance with the schedule. For example, if the business succession plan is within 2 years, the milestone should be set for the whole period of time. Besides, the business plan should cover the future plan for the successor to study and understand, including Policies and Procedures that indicate the status, roles, and responsibilities of concerned people in the business succession. This is to measure whether the successor is qualified for the position.

2.Communicate about the business succession plan

Concerned people like employees, business partners, and customers should be informed about the succession plan. Communication should not limit only an e-mail or business memo, meetings among the executive team and third party should also be held to let them know about the change of leader. In some businesses, we may need to inform the method in selecting the successor to demonstrate transparency. For a business that leader is a role model and high acceptance, an announcement about the succession to the public should be made to prevent overwhelming that may impact the business sector.

3.Handover the business strategically:

  • Train incrementally: Assign an important project to a new successor to learn by doing, and to monitor if he/she is qualified for the succession. We may use the ‘Job Shadowing’ method to allow the new leader to follow up and learn every step from the current leader.

  • Be descriptive, not prescriptive: Be reminded that each person has a different management style. Thus, the current leader should inform the successor about accomplished works, and leave the new leader to handle them in his/her own way. That practice will build confidence and prove whether the new leader owns other skills in completing all assignments.

  • Create milestones: Define milestones to check a readiness to pursue the position, and to give a sign to employees about the work progress of a new leader.

  • Focus on the future: Realizing that handing over the business to a new leader is to set a plan for the organization's future. We need to place trust in employees that the new leader’s proficiency will lead the organization to more success.

  • Determine to step aside:  Cleary schedules the date to hand over the business and realize that your ownership is over, and then pass on all responsibilities to a new successor.

Planning for business handover is not easy and is one of the most significant parts of doing the business. The current leader should start planning this task ahead of time to manage things thoroughly in a timely manner, to select a suitable successor, and to ensure that the organization's future will be secured in a new leader’s hands.