Remember your teenage self? If you could sit down with him or her now, what would be the first 3 things you would tell your younger self in the hopes that life had run a bit more smoothly since then?
If your retired self came to visit you now, he or she would likely have some similar advice for your present self with regard to succession planning for your business and for your personal retirement strategy. The question is, would you be wise enough to listen and make changes?
This is your opportunity. Your retired self is here, and has some invaluable tidbits of wisdom to bestow upon you. Get ready to make some changes that will increase the value of your business and set you up for a retirement that you can truly enjoy.
- Figure out your value. If you can’t succinctly tell others what value your business brings then it has no saleable worth. You need to show how you have an offering that is in some way unique – either by way of the market share you generate, the types of needs it meets, the impact of the results, the profitability of the model or some other way. If you don’t know – ask clients, colleagues, your business mentor, your business strategist or others you trust. This might sound touchy-feely, but if you don’t invest here, retirement is going to be based purely on whatever you managed to save along the way, because the business won’t be worth anything when you stop working.
- Set some targets. When are you hoping to retire? What are you anticipating that lifestyle to look like? What will your cost of living be to sustain that? How much do you need to start saving now to make that happen? Will you stop working completely or slowly work your way out of the business? What do you anticipate the business will be worth the year of your retirement? Show me the numbers that justify your projected revenue and your calculated value. These are a few of the necessary questions you need to consider in order to set targets that will give the opportunity to have a retirement you plan for versus the retirement you randomly wind up having to accept.
- Start working your way out of a job now. Sure it feels good now to be indispensable to the business, but that is a disastrous reality if things haven’t changed by the time you are ready to go. Working your way out of a job means figuring out why the way you operate in your role works, and how to replicate that success in others. It also means training others to do it. In order to train others, you need to write down your approach, your processes for everything, and your learnings around what does or does not work. The less you are needed to operate the business successfully, the closer you are to a viable retirement plan.
- Test your succession plan – take vacations. Do you laugh out loud when people ask you when you last took a vacation? Do you wear your busy work schedule and inability to get out of town like a badge of honour? If your answer is yes, then it is time to reframe everything. Taking a few days away from the office is a great way to test how well the business can run without you. The reason it is so valuable is that there is minimal risk to your annual revenues to be out of touch for a few days at a time, but it is incredibly revealing in terms of what stops in your absence and what continues on fairly smoothly. Anything that stops needs to be addressed in your succession plan. If a few days feels like too much – try a day. Then work your way up. Maybe a set a goal of taking a 3 week European vacation with no smartphone contact in a few years. There will be hiccups, but treat those as learning opportunities, not failure.