When the organization was founded in 2005, members of the International Succession Planning Association put together a list of the 10 major tenets of succession planning, said founding member Dan Schneider, a partner at succession planning company The Rawls Group.
The list applies to individuals ranging from those involved in small family-owned businesses to those at Fortune 500 companies. Its purpose was to explain the subtleties and nuances involved in the often ill-executed practice of succession planning.
Companies can review the list and check things off to make sure each is included in their succession plan.
1. Involvement of owner or majority stock holder: What is the business owner’s stake in the next generation of leadership? How will the owner want to be involved in the succession process?
2. Financial planning: How does the next generation of leaders match with the company’s future financial goals?
3. Business structure: How is the business structured today? Are there plans to change that in the future?
4. Business performance: How is the business faring in the global marketplace today? How could a new leader potentially affect this business performance?
5. Strategic planning: What kinds of additional plans are in place for the future? How is succession planning integrated into this overall forward-looking framework?
6. Management synergy and teamwork: How is the company’s management connected? Is there a general sense of camaraderie? How can that change with the next generation of leaders?
7. Leadership continuity: How can the company ensure that the next generation of leaders possesses the same type of leadership skills as its predecessor? Is sharing leadership skills important from one generation to the next?
8. Successor identification and development: Does the company look internally or externally for the next generation of leaders?
9. Board or family governance: How is the board set up? What kind of processes and procedures does it already have in place for succession planning?
10. Board or family dynamics: How is the board organized? Is there a person whose job it is to spearhead succession planning?
Each of the pillars is interdependent. “You can’t just pay attention to one or two of them,” Schneider said. “That will do little to ensure the success in transition from one generation of leadership to the next.”