Why Succession Planning Matters

This BusinessWeek article tells the story of why Viacom Chairman Sumner Redstone, 84, isn't the only corporate leader who's not ready to designate an heir apparent.

Redstone has already driven his son from the business, a conflict that was settled in 2007 when he paid his offspring $240 million to relinquish his claims.

With the recent news that he is reportedly asking his daughter and longtime heir apparent, Shari, to leave Viacom, it seems that even the famously shrewd Redstone has once again been outdone by the demands of succession planning.

There are good reasons why succession planning is one of the most challenging to-dos on a family business owner's checklist. To begin with, the stakes are high—so high in fact, that most family businesses fail to negotiate the transition and are sold either to pay taxes or because no one in the family is willing or able to take over.

BOTTOMLINE: "To adequately prepare for succession, you should evaluate the skills and attitudes of everyone in the organization who is a candidate for a leadership position. Everyone? Yes, because the CEO isn't the only position that requires succession planning."

Unlike Sumner Redstone, you may never preside over an $8 billion empire. But still, seek outside help. Even if you would never use an outside adviser for any other decision, consider the value that an experienced professional can bring to this important event. In case you balk at the possible expense or the distraction on top of your other duties, consider that poor succession planning is more likely to sink your company than any other risk. And just by doing it you'll place yourself in an elite group. Unlike the vast majority of those who ignore succession planning, you'll be working to reap the rewards of succession in a different and smarter way.