Communicating your Succession Plan

Make no mistake, as important as all the other factors are, none of them matter if you don’t execute your succession plan properly. The value of your practice is going to be determined by the ability to retain your staff and clients. Communicating your plan effectively is the key part of executing it. As you’ve spent time determining the best course of action for your succession plan it’s important to do a gut check. Do you really believe that what you’re doing is going to be best for your staff and for your clients?

This is the time to be the leader that your staff and clients have come to depend on. We can’t stress it enough. Your leadership and communication will be the key to the success of your succession. It’s important to take time to have a well mapped out plan and communicate the plan as clearly, directly, and honestly as possible.

In his book, Dig Your Well Before You’re Thirsty, Harvey Mackay talks about the importance of preparation. These are the kinds of conversations that you’d be wise to script. This ensures all of things important to you are well articulated to this group of people you care about. Your clients and your team have become family over the years, it’s important they understand this is a big deal for them. It is also a big deal for you, and its important your team and your clients know you haven’t taken the transition lightly.

Remember, part of your valuation will be based the buyer’s ability to retain both your staff and your clients.

Communicating with staff:

When communicating with your staff, it’s important that you take a very personal approach. Each of your team members is going to receive this news differently. Some are going to see this as a betrayal, or a major sign of job insecurity. Remember to be direct and honest. This isn’t a time for fluffy words or a lack of clarity. You need to tell them in plain language what’s happening in your practice. This is a scary time for your team so it’s important as the leader you demonstrate confidence in your team as you move towards succession.

Tell your team members exactly what the succession plan means for their job. This may include increased job security and greater opportunities for growth. Particularly if you are going to be going through an external transition and working with a larger group. They could have an opportunity to take on an expanded role in a larger organization.

Your succession plan can also give them an opportunity for enhanced learning. For staff members who want to grow they will have additional resources and opportunities to work with new technology. The new organization may provide extra tools for them to use in serving your clients.

Be clear about the schedule for the transition. It could be several years, which may ease some of the concern of team members. Especially if they haven’t been notified ahead of time or been a part of the discussion. Also important is to let them know what role you’ll play in the transition, what role they’ll play in the transition, what role your succession partner will play as well.

Keeping your employees happy, confident, and on track will lead to a much better outcome for everyone.

Communicating with clients:

Once you’ve mapped out your communication plan and strategy with your team, it’s time to communicate your succession plan with your clients.

There are several ways to communicate your plan:

• In person
• By mail
• By phone

What is best will depend on each client’s communication preferences. Take into consideration any logistical concerns, the number of clients you have as well as the time table you have put in place.

In person:

If you have time or if there is an internal succession partner, you can do this during your regular review process. You can talk to your clients about the team member that they will be working with, as well as any other service-related items important to convey in person to both the client and your new associate.

By mail:

Obviously, for your top clients you’re not going to send out a letter announcing a change. For clients that you believe it’s appropriate, you certainly can include a letter announcing the changes. Be sure to include the schedule, the benefits, and answers to frequently asked questions.

By phone:

Making a phone call to your clients to begin the process of letting them know your succession plan. Script this call with some bullet points to make sure you convey everything that is important to the client as part of the transition. Specifically mention the benefits to them.

Regardless of how you choose to tell your clients, you must focus on what the benefits of the transition are for them. In many cases, the advisors we work with have already had clients ask them what their plan is. This gives you an opportunity to lay it out for them and to bring clarity and confidence to their plan as you execute yours.

​Ultimately, you want to position this transition as a continuation of care for your client. You’ve come to care about these people, their goals are important to you. As important now as they’ve ever been. Part of your process has been designed to help you be able to continue to provide for them even after your own retirement.

Answering questions:

​Clients are bound to have questions, develop a list of frequently asked questions you can provide to them. We suggest you schedule these meetings or calls and do them in stages. It is important to be mindful of your specific community. Try to inform clients in similar social groups together or as quickly as possible.

​When it comes to putting it all together, it’s important that you remember your responsibility as a leader. If you’ve gone through the process properly, you should be excited about the future of your practice. You’ve taken care of your team and your clients. As part of your succession plan you’ve selected the ideal opportunity for them so they can continue to be taken care of after your retirement.

* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete. Any opinions are those of Chip Munn and not necessarily those of Raymond James.