When the time comes to move on from your contracting firm, executing a succession plan can be more challenging than you might expect. Historically, a succession plan would entail the stakeholder relinquishing control to the most qualified person in their family, but today, the stakes have been raised, and a merit-based system is more commonly implemented to make such decisions. Contractors face many challenges when making succession decisions. In this brief article, a construction lawyer in Clarksville, TN, will outline some of these challenges.
When you think about your succession plan, you probably envision one of your children taking over your legacy and driving it into the future. However, education can play a significant part in this determination. For instance, if your child’s education didn’t pan out the way you expected, they may lack the qualifications to take over your role. Conversely, if your child has pursued a degree in medicine or another highly intellectual field, they may have no desire to join the construction industry at all.
Many construction professionals believe that workers from more recent generations lack the toughness and work ethic to take over a high-level construction position. There may be some merit to this sentiment as indicated by the severe labor shortage plaguing the industry. Millennials have a tendency to chase white-collar professions, which doesn’t bode well for many contractors’ succession plans.
As the construction industry embraces new technologies and smarter strategies designed to expedite construction and increase safety, it’s never been more daunting to take on the role of a general contractor. Established professionals are often at a disadvantage when it comes to the integration of new technology. On the other hand, newer workers might not have a full grasp on the foundational principles of the industry.
Forward-thinking business owners have likely planned in advance to successfully implement their succession plans; however, determining the perfect person for the job can be tough without family ties firmly planted to monitor the autonomy that follows a succession plan. As a contractor, you’ve likely forged strong bonds with many of your employees, and some of these employees may be the answer to your succession plan. Unfortunately, this leads to other challenges including the potential for interfamilial conflicts.
Another challenge associated with succession planning is timing. How can you tell when it’s the right time to implement your succession plan? During a volatile economy, a poorly timed succession plan can send your business plummeting into the red. When a succession plan results in a revamp of your business, re-establishing your foothold in the industry can take much longer than your successor planned, resulting in lost profits and unhappy workers. While past generations had a tendency to work themselves into the grave, today’s business owners want to enjoy the finer things in life and spend time with their families before old age sets in. Fortunately, a construction attorney in Clarksville, TN, can assist you with all of your succession planning needs.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.