How do I find a successor?

I have been the managing director of my business for the past nine years, but I am looking for a change. I would like to install a new MD and know of two possible candidates, one of whom works for me currently. I don’t intend to fully exit from the company, but I do want to hand over a lot of responsibility to the new person. I actually want to diversify the business and would like the new MD to run the section that I have created to date, while I move on to pastures new. However, I find it difficult psychologically to think about recruiting my own replacement. I would appreciate some advice on finding my successor and developing a structure for this new phase.

A. Alysoun Stewart writes:

First, formalise exactly where your responsibilities end and your successor’s begin. If the lines are blurred, it will create tension and prevent the new MD from delivering. Your plan should clearly outline what your new role will be, the goals for the new business areas you intend to pursue and the nature of your relationship with the legacy business. You will need to accept that you will no longer have executive control and should be preparing to work in a more collaborative fashion with both the new MD and the present management team.

Finally, establish a timeframe for the handover period, and stick to it. The recruitment process should start only once there is a clear plan in place, including responsibilities and decision-making rights. The decision shouldn’t be yours alone, and should involve the full board. You could even remove yourself from the process, so any residual need to control your legacy does not influence decision making. The key consideration will be the vision each candidate is able to communicate, how closely that fits with the vision of the board and how capable you believe they will be to lead the business.

Hopefully, your successor will have some fresh thinking and new ideas to bring to the business. Your challenge will be to allow new shoots to grow free from your control. If you stifle your new MD’s ability to innovate, you will not only lose the benefits of their ideas, but also the person. However, you will also need to keep a close eye on their performance and take action if things are not going to plan.

Finally, it is important to remember that this process will be almost impossible to undo once embarked upon, so take your time and make sure it is exactly what you want. A former MD trying to reinstate his or her control is not a pleasant scenario for anyone involved.

Alysoun Stewart is head of the Entrepreneurial Advisory at leading global accounting, tax and business advisory firm Grant Thornton. www.grant-thornton.co.uk

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