The importance of succession planning for your clients could go well beyond its impact on family matters. New data points to business succession planning being a significant factor for employee engagement and retention. In short, proper planning could mean the difference between business failure and success after your client steps down.
According to Bersin by Deloitte’s new study, “High-Impact Succession Management: Key Findings and Maturity Model,” the benefits of succession planning also go beyond corporate owners and executives. Businesses that put a focus on succession planning for roles that are critical to operations tend to excel when it comes to worker morale and loyalty.
“The top two benefits of effective succession management in these high-performing organizations are improvement in employee engagement and improvement in career development opportunities,” Kim Lamoureux, vice president of leadership and succession research at Bersin by Deloitte, stated in a media release. “This is good news, because it means that sophisticated succession management programs address the number two priority- after leadership gaps – previously cited by HR leaders in Deloitte’s Global Human Capital Trends 2014 report: retention and engagement. Employees who are provided with performance feedback and are alerted to potential future opportunities within the organization are more likely to be engaged in their work, and therefore more likely to stay with that organization.”
If this data makes one thing clear, it’s that business succession planning should be a priority for your clients. With so much ground to cover for retirement planning, it can be easy for business needs to be put on the back burner in the face of more personal issues, such as long term care insurance and estate planning.
However, whether your clients are keeping the business in the family or are simply looking to cash out for retirement, there’s no doubt they’ll want their legacy to be one of progress and prosperity. According to the Bersin by Deloitte report, business succession planning may be the ideal way to achieve this.
Start sooner rather than later
As with any financial planning need, getting a head start can mean all the difference for your client. With the security of business operations at stake, putting a business succession plan into place as early as possible can be essential for a smooth transition that will leave employees not only feeling secure, but optimistic about their roles.
It will also make it that much easier for your client to get their ducks in a row where it concerns this important life change.
Business succession planning may only be one small part of an overall retirement strategy, but it has the potential to create long-lasting effects both good and ill.