The Succession Planning Action Checklist

If you follow this Blog, you know I am a big golf fan.  This weekend, the Open Championship, one of golf’s four “major” championships is being played at England’s Royal Liverpool.  As I have watched some of the world’s great golfers stepping up to the tee, it is clear they each have a routine, a process or checklist they follow on each swing and throughout the tournament.  As they review mentally the steps for success, they are more likely to be successful in their pursuits.  The same can be said of succession planning.  There will be hazards and bunkers.  There will be errant shots and injuries.  You may even go out of bounds and have to take a penalty stroke.  But if you can keep coming back to your process you will ultimately find your way to success.What follows is a checklist of action steps that are necessary as you seek to create a succession plan for your family business.

  • Answer the essential question – do you want to pass along a business or just the assets?

  • Define your goals and objectives.

  • Schedule a family meeting.

  • Identify potential successors.

  • Establish a timeline for succession.

  • Seek commitment from all family members.

  • Schedule a meeting with your advisor team (attorney, accountant, financial advisor, insurance professional) to discuss implementation.

  • Complete Estate Planning.

  • Create a business plan.

  • Establish a retirement plan.

  • Determine Life Insurance needs

  • Determine Long Term Care Insurance needs.

  • Form appropriate business entities.

  • Create appropriate legal agreements such as an Operating Agreement and/or Buy-Sell Agreement.

  • Establish business systems with appropriate policies and procedures.

  • Establish a plan for training successors.

  • Create a plan for transitioning ownership.

  • Communicate throughout and revise when appropriate.