Does your business survive only if you do?

Since opening my company in 2002 I've had this overwhelming desire to make sure my business was greater than myself.  I would say to my sales team each week, "You need to understand and know this because if I get hit by a bus tomorrow - I don't want you to be unemployed." 

I remember early in my career the couple I worked for wore so many hats it was as overwhelming as Value Village on Halloween.  The hat that always made me laugh the most was, The Martyr. I believe the personal mantra of one of the partners was, "No one could possible do 'it' as good as I can so I'll handle it myself - and by gosh they'll like it."  The reality was there were many people on her team who likely could have done 'it' better.  She truly was the keeper of all the company secrets - if she had been hit by a bus we all would have been unemployed.

What kind of company do you run?  Are you the keeper of the all the secrets to its success or do you share your vision with your team and let them run with it?  What would happen to your business if you didn't or couldn't work in it any longer?

For many business owners these are questions that arise and few seem able to answer.

If a large corporation follows theories of organizational development, it typically embraces the idea of succession planning.  That is to identify, mentor and retain team members to replace key players within a company as the positions expire.  How would the solopreneur or small company implement these same strategies?

Imagine you own a company that creates and designs The Futternutter (I googled to make sure there was no such thing) where you have a business partner who is the idea guy and you are the hands-on gal.  One day the idea guy doesn't come back to work after he is killed in a skydiving accident.  With your business' revenue based on your ability to implement his ideas - the ideas are now gone, and implementation will be difficult without those ideas.  Add to this, his surviving wife technically owns his half of the company and you have just inherited a business partner you never intended to work with directly.  What could you have done?

Most of us have marketing plans, and business plans, but we continue to neglect the succession plan.  It is critical in the organization of your company to discuss with your attorney how the shares of one partner would transfer to another in the event of death or permanent disability.  Depending on your situation the attorney may have you construct a buy-sell agreement funded with life insurance, or a key-person policy where an amount of life insurance would be purchased on the life of a key employee, who if unable to perform their duties due to death would make up for the economic loss the company could feel in revenue until a replacement could be identified.  This is just the beginning.

Now what about your customers?  You are a solopreneur maybe in marketing or design, financial services or law and you don't come to work one day.  Who will know how to access your active accounts, reach your clients to let them know what has happened to you and explain to them how in your absence how they will continue to receive the same excellent service and work they have come to expect.

A small business owner colleague of mine in his early 40s was recently involved in a high impact car collision that left him in a coma and in the hospital for several weeks. In his absence what has happened to his business?  If this had been you, would someone have known how to reach your clients?  If not, how much business might have been lost, deadlines missed and how much of your reputation tarnished?

There are many people who walk our planet saying, "Yeah but it won't happen to me - I'm young - I'm in good health - I run every day ....." The reality is life happens when we least expect it - and when we fail to plan we plan to fail.  

Our businesses are an extension of ourselves; our integrity, our character, vision and passion.   Make a resolution to lay out your succession and continuation plan.  Meet with the key people that can make this happen from your attorney and insurance professional to the key people on your team or inner circle who will make sure your business is your legacy.

Debbie Whitlock is a Registered Representative of, and offers securities through, Woodbury Financial Services, Inc.  Member FINRA, SIPC 3200 First Avenue S, Suite 300 Seattle, WA  98134 (206)749-5111.  Sound Financial Partners and Woodbury Financial Services, Inc. are not affiliated entities.  Neither Woodbury Financial Services,Inc., nor its registered representatives provide tax or legal advice.  As with all matters of a tax or legal nature, you should consult with your tax or legal counsel for advice.