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3 factors to consider when choosing business successors

On Behalf of | Nov 7, 2017 | Business Law |

Because many New Jersey business owners often look at their companies as an important part of their lives that they took the time to create, it can feel strange to think about handing the business off to another person. Even though you may wish you could continue running your company until it closes its doors, that may not be a feasible hope. If you want your company to continue to thrive, you may want to carefully think about business succession.

Choosing the right individual or individuals to take over leadership roles within your business can have its challenges. You certainly want to make sure the right candidates are up for the tasks and that you feel as if you are leaving your company in good hands when the time comes. Therefore, you may want to consider certain factors when determining your potential successors.

Experience level

When making your choices for successors, you could look at various aspects of their education and experience. Though having the book smarts associated with running a business can prove beneficial, experience may outweigh education when it comes to business succession. You undoubtedly do not want to place a person in a position of leadership who may not fully understand the challenges that could come with the job.

Internal vs External candidates

You could also look within your company to find potential candidates to take over, or you could look at outside sources for potential candidates. Though external candidates may have the experience, it has been reported that external hires are more likely to be fired or leave the job. With internal candidates, you may have the ability to groom a chosen few to potentially take over when the time comes.

Variety of skills

Though your company may have thrived with your way of running the business, you may not necessarily want to choose candidates with the same skills and tactics as your own. Because the business world can change quickly, having individuals with different skill sets could help ensure that your company does not get stuck in the old ways.

Crafting a succession plan

Even if you do not plan on leaving your company any time soon, having a succession plan in place early could help avoid a sudden panic in the event that you or other parties in leadership positions must leave their posts. Therefore, you may want to look into your planning options and create a plan that best suits your needs.

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