Page 23 - E- Connect 2021

Family Business
Mitul Rathod
Mitul Rathod
and Succession
ARTICLES business, no matter how small or Planning

Business is a continuous activity. Any
business, no matter how small or
large, needs potential successors.
large, needs potential successors.
The transition of a business from
The transition of a business from
one generation to the next is is
one generation to the next
usually a burdensome process.
usually a burdensome process.
Here succession planning comes
Here succession planning comes
into play. If planned in advance
into play. If planned in advance
and executed in an orderly manner,
and executed in an orderly manner,
succession planning can yield fruitful
succession planning can yield fruitful
results for the coming years.
Succession planning is not given
Succession planning is not given
due diligence but it is a critical
due diligence but it is a critical
process that has to be followed in order
process that has to be followed in order
to ensure continuity of the business. In a nut
to ensure continuity of the business. In a nut
shell, succession planning is the systematic
shell, succession planning is the systematic
process of recognizing and creating future
process of recognizing and creating future
leaders who are able to take the position of
leaders who are able to take the position of
the old ones when they leave the organization.
The reasons for leaving the organization could
be retirement, resignation, transfer, promotion
or death.
Multi-generational success in a family
business requires higher levels of commitment
and unity of purpose. In large multi-generational
families, succession can often become a
sensitive subject. Thus, good governance
practices are vital that set clear policies and
structure as to how the succession plan needs
to be executed. To conclude, succession
planning should be executed in an orderly
manner but it should not ignore the most
essential element of any family business, i.e.,
is “the family”.

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2021-2021