Do you know what would happen to your business if you needed to step away for a prolonged period of time? How would it continue to operate and how would you fulfill your deliverables to your clients?
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Today, we are talking about a topic that service based business owners often put on the back burner until it is right in their faces.
Expert Julee Yokayama joins us to talk about her own methodology and body of work in the area of contingency and succession planning for your business.
Today’s conversation is focused on the business impacts of these two likely situations that will be in your life at some point.
Meet Julee
Julee Yokoyama is a small business operations consultant. She’s a strategist with certifications as a Director of Operations and Project Management Professional. Needless to say, she’s a planner who does her homework and helps service-based business owners do the same by organizing and protecting their business operations. The results? Peace of mind, operational efficiency, business growth, and overall life fulfillment. With 15 years of consulting experience in both corporate and small business settings, Julee guides and supports her clients through the tough conversations around risk management and succession planning, so the mission-critical aspects of their businesses are covered in case of emergency or extended leave. Julee lives in Seattle, WA with her husband and two fur babies, Lucy and Desi.
What is Contingency Planning?
- Contingency planning is taking a proactive look at whatever subject you are looking at
- If you are familiar with contingency and succession planning it’s usually because you worked in corporate at some point
- Risk management in a formal sense tends to be unfamiliar territory for entrepreneurs
- It involves proactively looking at all of the risks, then
- ranking the probability that they would happen
- planning for their impact, and your response
- looking at if they can be prevented and what would it look like in action and/or financially
- You can take this kind of philosophy and apply it to any level of the business
- It is a great facilitator when working with leaders
“[Contingency and succession planning] are not talked about in the small business and entrepreneurial spaces, so risk management tends to be an unfamiliar territory for many entrepreneurs” – Julee Yokoyama
- Operators can often see the forest through the trees, so we can come to our leaders with strategy or advice on how something will go
- This is a great framework to walk [leaders] through the risks so they can see it for themselves
“Entrepreneurs do not think about the what-ifs because they are so gifted at looking at the vision… there is a big opportunity to educate your leaders on the importance of contingency planning.” – Natalie Gingrich
Having the Conversation
- You should look at the leaders background, which will tell you if they are figuring business out as they go, or if they are established and understand what plans need to be in place
- Use this information to start the conversation
- You can bring in the team as well to help with risk identification
- If you are supporting someone, bring this risk up sooner than later; it is a conversation that needs to be had
- Julee focuses on strategy, and is a certified DOO (Director of Operations)
- When she was going through the Strategic Mapping Model ™, she started asking her clients the question “What happens to your business if something happens to you?”
- Most small businesses have a primary knowledge holder who has systems and processes only they understand
- Many of these businesses responded “If I die, the business ends”
- This is misguided because there are all of the pieces that the business owner took the time to assemble to create this asset that need to be dismantled
- Many of these businesses responded “If I die, the business ends”
“If you were to be gone tomorrow, all of those pieces [of your business] need to be dismantled, or the asset becomes a liability for your loved ones.” – Julee Yokoyama
- If you are thinking of these things in advance it creates so much more opportunity because you’re not in a space of crisis or panic so there is more room to be creative with your ideas and solutions
Succession Planning
- Succession planning is the most essential type of contingency plan, even for solopreneurs
- Start with the question “What happens to the business if something happens to me?”
- Break it down to “what are the types of things that could happen?”
- You can start to decide what needs to be organized and what are the gaps and SOPs that need to be documented
- Start with the biggest source of potential failure, which would be the leader
- DOOs may need to start with the delivery piece
- Identify what would happen if you were gone forever
- Do you want to sell?
- Pass it off to a team member or a peer in the industry?
- Does anyone else know what your plans are? Document all of this and think about who else needs to know about it
- Who would be taking action if something happened to you?
- Do they have access to anything, or the knowledge of what to do?
- What do they need to be successful?
Project CYA
- Julee’s program, offered as a one-on-one intensive: a holistic contingency plan
- Essentials: a Done For You digital product; a place to start that will help you organize your business affairs and get your documentation in order
Connect with Julee
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