Avoiding Chaos: Why You Need To Start Succession Planning Now

In a perfect world, you’ll be able to decide exactly when you want to exit the business, and your team will be well prepared for this change.

However, life rarely goes according to plan, which is why you need to develop your strategy for succession early on.  

Chris Psencik, partner and vice president of McFarlin Standford, which provides business coaching to landscape companies, says the majority of the business owners they encounter have no thoughts of what their succession plan looks like or what their business is worth.

“Oftentimes they have family they hope to take over the business or a partner or spouse involved in the business and lack any sort of support structure, key man insurance or documentation to show what and how the business will continue to operate if something were to happen to them as an owner,” Psencik says. “This is very unsettling for us and something we have worked very hard to create a system for helping owners get to a better position to ensure that the business can continue to operate if something were to happen.”

What Can Trigger a Succession Plan Early?

Health issues or suddenly receiving a promising acquisition offer are some of the main reasons a succession plan may go into effect sooner than expected.

“In some instances, we have seen owners pass away or have a health event that doesn’t allow them to continue in the same capacity they were working before,” Psencik says. “We have seen divorce, marriage, and in some terrible situations, we have seen addiction get in the way of what and how a business operates. Bankruptcy and financial viability can also be a situation that might result in the transition of succession in a business.”

Kurt Bland, president of Bland Landscaping Company, based in Apex, North Carolina, says that he and his brother took over the business from their parents when they were 29 and 27, respectively.

“I had one week’s notice because my mom was diagnosed terminally ill with cancer,” Bland says. “Mom got a diagnosis in December of 2004, and in January of 2005, my parents decided that my father was going to take a sabbatical and care for my mother.”

Bland says their original plan was for him to take over the business when his father was 65, but ended up doing so when his father was 55. Even though their succession plan was triggered 10 years ahead of schedule, they were already prepared with ownership agreements in place.

“When I was 18 years old, my parents started involving me in ownership decisions in the business, including giving me a small stock in the company so that I could see how it worked to have these responsibilities,” Bland says. “So, we had prepared for so many years for what was to come in the future, that when it happened ahead of schedule, we were as ready as we could be.”

Bland encourages owners who want to pass the business to the next generation to involve them in the leadership aspect of the company early on.

“If my father hadn’t prepared my brother and I the way that he had, and we weren’t both back in the business ready to take over for he and my mother, the business could have survived, but I don’t think that it would have thrived without my brother and I there.”

Bland recommends that all business owners create a living will and declare power of attorney.

“You could end up in a situation where someone could be in a coma for a long period of time, and somebody would never be able to do anything about making decisions as it affects their business, and the whole business could collapse just simply because of that,” Bland says.

Preparing Your Team

When you fail to prepare your team for your succession plan, it is inevitable that some employees will start seeking new opportunities due to the uncertainty.

“Change is uncomfortable for anyone and can be scary,” Psencik says. “So, it is important that key team members are set up in a way that it is clear what and how their role will exist during and after a transition. It is also important that leaders understand what potential opportunities will exist for them after a transition and what their role will be in the new setup.”

Psencik says profit sharing or phantom stock are some options that can help encourage your leadership team to remain on during a transition.

Bland agrees that you need to involve your stakeholders in your plans. He says they discuss with their vice presidents regularly on how to respond if something were to happen to him and his brother.

“If something happens to me, we talk so much about where we’re going and what we’re doing, I know in good conscience that this company would not miss a beat if something happened to me tomorrow,” Bland says. “I don’t worry one bit about it.”

Bland stresses you need to be vulnerable with your people and let them know that this is something you’re thinking about because it directly affects your team. He adds that you also shouldn’t just assume who will step up in your place without discussing the matter with them.

“When you sit down and talk to them about it, they may explain to you that they’re not prepared for that burden,” Bland says. “They can’t handle that kind of stress. They don’t want to be that person. On the flip side, you may have somebody that looks at you and says, ‘I’m glad you brought this up because if you hadn’t brought this up on I was thinking about leaving because I’m concerned about the fact that this company is not growing because you’re 75 years old, you still own the company and you don’t want to sell it, yet I’m looking for advancement.’”

Psencik says you can’t expect someone to know your intentions if you aren’t communicating with them.

“As you identify these key individuals, it is important that you let them know what you see in them that makes them special and what you think they could be doing to help continue their growth and then lean in and mentor and support them in that growth,” Psencik says.

Jim Tuzzolino, Southern division president for Ruppert Landscape, headquartered in Laytonsville, Maryland, notes that even informal, ongoing mentorship can be a powerful tool for succession prep so your key employees are ready to step up.

“We offer internal training programs focused on communication, team building, strategic planning, and people management,” Tuzzolino says. “We also emphasize hands-on experience, constructive feedback, and opportunities to take ownership of decisions. Engaging with external organizations like NALP or community partners also helps broaden their perspectives.”

In cases where Bland Landscaping has the right people, but they’re not quite ready to move into an open position, Bland says they make a point to inform these individuals of what they’re trying to achieve and the need for them to prepare the person behind them while learning their new role.

“By doing it that way, we forced ourselves to have the luxury of time,” Bland says. “Too often, when these decisions are being made, they’re being made with time constraints that may not allow for some of the necessary thoughtful transition.”