It’s a simple enough question. What happens to your business if something happens to you? How does your business continue? If you’re a single-owner, single-employee business, I guess that means your business will shut down, unless you have sufficient processes and procedures in place and have a way of transitioning that business to somebody that can follow through.
At my law firm, when we set up companies, we often ask them if they want to have a backup manager, somebody who can step in and take over the business in the event something happens to the only owner. This is critical. This keeps the business alive and moving forward if the only owner is unable to perform their work. What are you doing in your business? What happens to your business? If you’re a bigger company, do you have a sufficient management team and others that are involved that are ready to take it over?
I’ve met with some businesses that have all their decision-making in a handful of people. One, two, or three people really control the entire business. This is a weak point. What if something happens to one of the people? What if something happens to two of those people?
I recently met with a company that had two key employees, who often traveled together and did things together. What happens if one of those trips has an unexpected problem? If they get injured, or disabled, or worse, die, what would happen to that business? After talking to them, the truth was revealed. They would be really hamstrung. Nobody would know what to do.
We played out the “what if” scenario. We found that employees would probably go running for the door because of the uncertainty. Key customers would probably disappear. The whole business could be shut down overnight just because of these two people because they don’t have a plan in place. We talked to them. We talked about the value of making a plan. We realized that if we put a plan in place, they could create more value. They could protect the value. They would have some certainty.
In the event of one of these unlikely events happening, employees would have your plan to look to for answers. They would feel like their job would continue. They would know the enterprise would continue. They would know they would get their paychecks.
Can you see how much that additional certainty is valuable to the business, how much that protects it for their families and their estates in the event something unfortunate would happen to these business owners? What are you doing to make your business bigger than you? What are you doing to make your business continue in the event something happens to you? Think about it.
Let us know what your experience has been in the comments below. Have you built a system for the possibility of you not being there or your business continuing without you? What if you’re disabled for a little while, and later need to come back to work? Would your business be completely disrupted and disappear? How would that feel? Let us know in the comments below. We’d like to discuss with you.
This posting is intended to be a tool to familiarize readers with some of the issues discussed herein. This is not meant to be a comprehensive discussion and additional details should be discussed with your attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. This article should not be treated as legal advice to any person or entity. Freeimages.com/Milca Mulders.
About the Author
Shawn McBride is the Chief Innovation Officer at McBride For Business, LLC. He is a frequent speaker at events. His signature keynote, The 3 Laws of Empowerment (www.rshawnmcbridelive.com), gives audiences an entertaining look at how they can prepare, plan and protect themselves. You can reach R. Shawn McBride at firstname.lastname@example.org or (214) 418-0258.
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