I’ve been thinking a lot recently about one of our roundtable members at the Coleman Center. I believe he’s in his mid-late 30s, and a couple months ago, he suffered a life-threatening health scare. From what I’ve been told, he’s progressing well, and we all look forward to a complete recovery very soon.
I believe the company has approximately 15-20 employees, that he’s the sole owner, and that his Vice President has taken the reins while his recovery continues.
That got me wondering…did he have a succession plan in place? What job functions was he performing that no one else could? How many critical business relationships were dependent on him? Did he have key employee insurance?
This is an often discussed yet seldom addressed aspect of business ownership – what happens to your company if something happens to you, the owner(s)? And it leads to an even bigger question – what happens to your business if it experiences any crisis?
It was a question that was amplified post-9/11 and post-Katrina, each of which mostly affected firms in those locales. But everyday around the world, there are numerous businesses that suffer a crisis of some sort. And I’ll bet that a very small minority actually have a plan to follow if a crisis occurs.
There are plenty of consultants out there who specialize in disaster, crisis, and succession planning. But if you’re like the average business owner, you’re budget-constrained and likely to put such consulting work lower on the priority list (after sales, marketing, HR, etc.).
Therefore, I’ve put together a list of questions that might help you begin thinking through critical issues and create a one-page crisis plan of sorts. If you do, let a trusted employee, manager, co-owner, or even a family member know where this plan is.
- Who will do your job? How qualified are they?
- If you pass away, who gets your ownership stake? Who else owns stock?
- Who are the company’s key advisors (accountant, attorney, banker, etc.)?
- Who are your key customers?
- Who are the key service providers (graphic designer, web site developer, printer, etc.)?
- Where are the company’s legal documents (corporate papers/minutes, contracts, etc.)?
- What bank accounts are in the company’s name?
- What is your organization chart? Who does what?
I invite you to post other questions you believe would be helpful to fellow business owners, as well as experiences you’ve had with crises and/or crisis management.