How to delegate control and let go of your business

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12/07/2017

Whether you plan to sell your business or hand it over to family or employees, good planning will help to make sure you have a successful handover. Learning to delegate control and then letting go of the reins entirely can be hard – but it’s especially important if you’re selling to family or passing the business on.

Helping your successor

The better you prepare the next person in charge for their new role, the more successful the handover will be. How you go about it depends on who the new owner will be. For instance, if you’re handing the business over to family make sure they have a genuine desire to run the business, and the necessary skills. You want to be sure they’re in it for the long haul.

If you’re selling to employees, whether it’s a senior manager, a group of employees or a set of shareholders, it’s important that everyone is aware early on of your intentions to leave.

In either case, there are some critical steps you should take to prepare the new owner:

• Let them watch you work. They need to learn as much as they can. Continually explain why you do things a certain way and how you make decisions. Have them document any process or system that you have created.
• Dip their toes in by letting them make some decisions, with your guidance. Work together on key projects. Encourage and correct. Start to give them control over key aspects of the business such as meeting customers, dealing with staff or generating new business.
• As they gain in confidence and ability, give them more decisions to make, with you as an external advisor. If they make mistakes show them how to fix them. It’s the only way they’ll learn to deal with the hurdles.
• At some stage give them total control. Encourage and empower them so that they are truly ready to run the business without you. This is one of the greatest challenges for most business owners.

Transferring control

Put together a transition team who’ll help you transfer control. They should be people who are not emotionally involved, like your accountant, lawyer, or business broker. Maintain open communication with your team and your successors.

Once the new owner has taken control, all decisions are theirs. And now it’s time to do the hardest part of all – walk away. This can be harder than it sounds, especially if you’ve built the business up from scratch and seen it become a success due to your own hard work and diligence.

Once you’ve walked away, don’t continually check in. Staying away can be tough, especially if you’ve passed the business on to family. They won’t thank you for continually dropping in after you’ve stepped down, so resist the temptation to do so unless they’ve specifically called on you for help.

If you’re retiring from work altogether, make sure you have a plan in place. Decide what you’re going to do with your free days, or you may end up just worrying about the business.

Advice and resources

• Inc.com has a good article on managing the emotional toll of selling your business.

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