KUCHING: Business owners should be adequately prepared for the succession of their businesses.
Business succession is vital because it will determine the continuation of the business and its future direction without disruptions.
Khind Holdings Bhd Group’s (Khind) chief executive officer (CEO) Cheng Ping Keat believes having a succession plan will enable the business to have stability besides being managed well by potential successor.
“Business owners and entrepreneurs should develop a succession plan or exit strategy to ensure the continuation of their businesses.
“It is an important aspect which affects all businesses and a challenge which is faced by many business owners.
“Starting and managing a business are not easy tasks what for to find a competent person to take care of the businesses,” he told dealers during a seminar in appreciation of their support to the company in conjunction with its 55th Anniversary yesterday.
The seminar was attended by approximately 50 dealers from all over Sarawak.
Quoting a Chinese phrase implying “wealth does not pass through three generations”, Cheng encouraged dealers to have succession planning and think about exit strategies for their businesses.
At the end of the day, business owners need to retire or pass on their businesses to its successor.
Cheng shared five options and approaches available to business owners while evaluating an exit strategy for their businesses.
These include passing the baton to their children or next-of-kind for family-owned businesses, hiring professionals to manage the company, disposing off the business, closing down or letting it gradually die off.
Cheng, whose father established Khind, shared several challenges and approaches in ensuring a smooth transition plan.
These comprised of grooming a successor, identifying competent professionals, having a board of directors as well as laying out the foundation for the direction of the organisation.
He observed that as time goes by, the operating environment for businesses has becomes more competitive.
“In order to grow and sustain the business in the new era of globalisation, teamwork, synergies between co-workers, cooperation and taking care of the interest of stakeholders are important.
“Thus, business owners should make early preparation for their exit plan.”
Additionally, Khind Group’s chief operating officer Boh Boon Chiang shared about the elements of good leadership in management.
He said a competent and good leader of an organisation should have five criterias which include energy, energise, edge, execute and emotional stability.