You started your business as a labor of love, nurturing it through those tough early years with grit and personal sacrifice. Over time, that seedling grew into a successful enterprise through your sheer force of will and hands-on leadership.
Your business has become an extension of yourself. After all, you are the boss, the visionary, the indispensable driving force behind it all. At least, that's how it may feel. But even for a skilled leader, there is one uncomfortable truth to accept - at some point, you must replace yourself if you want your company to outlive you, whether it’s through a sale, your retirement, your death or incapacity. Paradoxical as it sounds, making yourself replaceable is the ultimate key to ensuring your business's longevity.
In this article, I’ll take you through not only why you need a plan for what happens if you’re no longer involved in your business on a daily basis, but also how to make the tough but right decisions for your business, and what to do to formalize your plans. Let’s start, however, with the first step: cultivating the right mindset.
The Paradox of Replacing Yourself
As an entrepreneur, you've worked incredibly hard to build your company from the ground up. Your business is your baby - the product of your passion, sacrifice, and undying commitment. Probably one of the last things you’re thinking about is either closing it down or handing it off to someone else.
But here's a difficult truth you need to accept: despite how indispensable you might feel, your business cannot rely on you alone to survive in the long run. Someday, whether due to retirement, illness - or of course, death - you won't be around to call the shots anymore. And if you haven't prepared for that inevitability, your life's work could crumble. And your loved ones could end up in court, or even in conflict with each other or your business partner(s) or team members. Your legacy could be tarnished. All these outcomes are avoidable, so long as you’ve planned ahead.
So what does it mean to plan ahead? It means you must make it your mission to systematically replace yourself as the boss. It seems paradoxical, doesn't it? You've worked so hard to get your business off the ground, so why would you willingly give that up? The answer is sustainability - if you want your company to thrive for generations, you need to let go of the reins, at least at some point.
Don't think of it as quitting or admitting defeat. Think of it as the ultimate show of leadership and love. By replacing yourself, your business carries on without being crippled by your absence. It continues to serve people who need your company’s services or products. It continues to provide jobs for your team members. It continues to support your loved ones, if that’s what you want. What a gift you’re giving to your customers and your loved ones!
Think for a minute about what could have happened to Apple after Steve Jobs died. Had he not made a plan to replace himself, it’s possible your iPhone would be just a relic today, maybe even stashed away in a box in your attic. Apple could have been broken up in pieces and sold off, or Steve Jobs’ loved ones tied up in court and in conflict with the other Apple shareholders. Thankfully none of this happened. iPhones are still being made and improved upon each year, and not only that, but new products have been introduced since Jobs’ death. In fact, Apple is still one of the most profitable and influential companies in the world.
You don’t have to be as well-known as Steve Jobs and Apple for the same lessons to apply. Replace yourself and your business continues to serve people and enrich their lives. Don’t replace yourself, and it’s very likely that your business ends when you do. It’s that simple.
Identify Your Successors
So how do you go about replacing yourself? Start by identifying whether you have any internal team members to begin to develop as potential successors, or if you’ll need to consider an outside sale of your Company, or possibly hiring for future succession. Don’t worry about finding a carbon copy of you, but rather molding people who share your vision and can build upon what you've created.
Groom these people over years by delegating bigger responsibilities to them. Slowly but surely, remove yourself from the day-to-day decisions and operations, and see how they step up. Provide candid feedback, guidance and advice, playing more of a coaching and mentoring role.
As you release the reins to others, you’ll necessarily need to shift away from working "in" the business to working "on" or even “above” the business. This is the perfect time to analyze your systems and make sure your business is set up with the right foundations for succession. If you aren’t sure you have the right foundational systems in place (specifically, your legal, insurance, financial and tax systems), engage with a trusted advisor who can help you, like us, or even a team of advisors, such as our LIFTed dream team we’ve assembled.
Before I move on to the next section, I want to point out something important. Did you notice above I said “people” instead of “person” when identifying business successors? That was intentional. For the health of your organization, you need a full bench of empowered leaders, not just one person waiting in the wings. Cross-train multiple employees or family members, documenting processes and getting everyone aligned with your company's mission, values and strategic direction. This is not only smart, but ensures continuity across the organization.
The Hardest Part: Let Go of Control
One of the toughest challenges as an entrepreneur is letting go of control and relinquishing the power and final say you've grown accustomed to. You have to fight against instincts of micromanagement and trust that your successors can rise to the occasion when you're not calling every shot. If you don't relinquish that control in stages, the hardship and wisdom won't get transferred.
For the entrepreneur who hung their entire sense of purpose and identity on their business, this can be an incredibly difficult mindset shift. But it's a crucial one for the long-term viability of your life's work. After all, what good is all that success if it gets erased the day you're gone?
Does it mean you have to check out entirely someday? Not at all! You’ll begin by establishing clear key performance indicators (KPIs) to measure so you can ensure your team is hitting their metrics, and that you are able to monitor results even without being involved in the day to day. And, long-term, you may want to stay involved as an advisor, board member, or even just have your name on the wall. The point is to separate your identity and personal involvement from the company's ability to operate successfully.
Make Sure to Formalize Your Plan
So now you know the importance of replacing yourself, you’ve identified successors, and you're letting go of control. It’s important to formalize your plan so it will be honored and enforceable. How do you do that? Work with a professional. As a LIFTed Business Advisor, I can guide you to document your wishes correctly and encourage you to think not only about death and succession, but also about something you may have overlooked - your incapacity. You need a plan not only for what happens if you’re no longer around, but also what happens if you’re around but unable to participate in your business, whether it’s from a terrible accident or a serious illness. You’ll want someone on your side who can walk you through these difficult scenarios so you’re empowered to make the very best decisions for you and your business.
The LIFTed Business Advisor Who Has Your Back
As your LIFTed Business Advisor, I am committed to guiding you through the crucial process of replacing yourself as the leader of your business, allowing your business to carry on without you and make a difference in other people’s lives. Together, we'll create and refine your foundational systems then build a solid plan so your life's work thrives for generations to come. That’s the secret to business success, and that’s the gift you give to your customers, team members, and your loved ones.
Book a call here to learn more and get started today.
This article is a service of The Law Offices of Casey D. Conklin, Ypur Family's Personal Lawyer®. We offer a complete spectrum of legal services for businesses and can help you make the wisest choices with your business throughout life and in the event of your death. We also offer a LIFT Business Breakthrough Session™, which includes a review of all the legal, financial, and tax systems you need for your business. Call us today to schedule.
The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.
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