Chances are you already know about backup and basic business continuity. So what's next? The answer involves a business continuity plan that includes executive succession planning -- for your own company.
Check in with HTG Peer Groups founder Arlin Sorensen and other channel industry leaders, and you'll hear a few horror stories about MSPs and VARs that lacked executive succession plans. In some cases, the CEO died -- and all the employees lacked access to the finances, bank accounts and more.
Killing Your Company
Short term, employees may suffer without paychecks. Longer term, the business can implode and could become worthless.
Amid that worst-case scenario, some industries are starting to regulate succession planning. Financial planners, for instance, could soon face succession planning regulations from their local states and perhaps even the SEC (Securities and Exchange Commission), according to FinancialPlanning.com.
Backup Data... And Executives?
Some pundits now lump succession planning in with business continuity planning -- basically, a catch-all strategy to ensure the lights remain on and the business continues running during a crisis situation.
For instance, the NASAA (North American Securities Administrators Association) recommends five steps in a business continuity and succession plan, stating that :
1. The protection, backup, and recovery of books and records.
2. Alternate means of communications with customers, key personnel, employees, vendors, service providers (including third-party custodians),and regulators, including, but not limited to, providing notice of a significant business interruption or the death or unavailability of key personnel or other disruptions or cessation of business activities.
3. Office relocation in the event of temporary or permanent loss of a principal place of business.
4. Assignment of duties to qualified responsible persons in the event of the death or unavailability of key personnel.
5. Otherwise minimizing service disruptions and client harm that could result from a sudden significant business interruption.
Our Own Plan
Here at After Nines Inc., we don't have a "formal" succession plan as of this writing. But we do have the basic piece parts in place, should anything happen to me or my business partner, Amy Katz.
While I run content and the technology behind our sites, Amy runs our business -- the revenue development, finance, accounting, sales, etc.
To make sure the business can continue if one of us gets hit by a bus:
1. Account Access: All account user names and passwords are documented, and both of us have access to all on-premises and cloud IT services, and all applications.
2. Financial Access: Amy handles the finances. It's always been that way since we started our first company together in 2008. But I at least have access to our corporate bank accounts in case there's an emergency that pulls her away from the business.
The wildcard in all this is: Would our business -- or your business -- continue on, for the long haul, without its current leadership?
Even if you have a succession plan in place, would the new leadership really want to carry the business forward for the long haul? Or would leadership seek a buyer for the business?
In our case, I'm not sure I'd want to "run" the business without Amy for the long haul. There's a sort of Ying-Yang business partnership that would be difficult to replace. If Amy exited, I guess I could "bring someone in" to do sales and manage the books. Or if something happened to me, Amy could "bring someone in" to manage content and the underlying technology.
Either way, at least we have a safety net in place -- equal ownership and access to all accounts -- so that the remaining owner can keep the lights on, continue to serve the market and not get locked out of our systems.
Can you say the same about your business?