March 8, 2019 293
March 8, 2019 293
There is time for everything in life under the sun, time to be born, time to die and so on. The entrepreneur should be conscious of this when establishing his company. From the very beginning, he started the business will equally be the time he should start thinking of his succession, knowing fully well that one day he may not be around, and for the business to survive, it must continue under a capable and qualify hand.
Succession is therefore defined as the process of planning the shift of ownership and/or control from one person to another in a firm. It may be further defined as the right of succeeding the founder or the entrepreneur so as to ensure continuity and suitability of the enterprise after the entrepreneur’s active participation.
The only way the business can continue continuously is to have capable successors. The process of succession may pass through from the founder to the offspring or from the director or manager to the next person. This is to say that offspring or from the director or manager to the next person. This is to say that succession can be from one person to the other irrespective of the relationship.
There are some unforeseen events such as being incapacitated, sickness, old age, death, etc, may put off the business owner or director; hence demanding mandatory succession. In view of these aforementioned reasons, succession is imperative and the planning should start in earnest.
The entrepreneur should start from day one to start preparing for succession. He has to groom people that would succeed him. Therefore, grooming has to be done to ensure that a smooth transition is guaranteed.
Below are the necessary methods for smooth succession:
The job of succession is not an easy one and this has to be handled carefully and seriously by the party concerned. The new successor may be placed on the acting capacity to prepare him for a peaceful transition.
Let us narrow our discussion to small enterprises in terms of succession plans. The problem of succession in small enterprises equally affects the business itself.
Below are the types of succession plans:
The entrepreneur should involve some like-minded individual to form a business partnership. So that if one person dies it will not affect the proper continuity of the business.
This is one of the best ways of ensuring the continuity of the business. Going public means being quoted at the stock exchange and the ownership and management of the company can be conveniently separated. When a company goes public, it means that shares are thrown to the public to buy thereby making the company a Public Limited Company (PLC).
A company that wants to be quoted as a public limited company can either be listed on the second-tier securities market (SSM) or the first-tier market in Nigeria. As a response to the need to encourage small and medium scale firms as well as private companies to go public, the Second-tier Securities Market (SSM) was floated to fill the gap. The listing requirements are always less cumbersome to that of first-tier. The stocks of the securities listed on the SSM can be bought or sold at the floor of the stock exchange.
However, the inventors of the companies listed on the SSM enjoy the same benefits and protection as those of the first-tier market.
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