I am often asked what the difference is between strategic planning and succession planning. Strategic planning and succession planning have significant similarity, both being long term endeavors with significant overlap.  The stakes are high in each endeavor. The success or failure of either will have a long-term, lasting impact upon the business. Likewise, unawareness of the importance of the initiatives or an unwillingness to address either initiative will also have an undesired, lasting impact. Therefore, this is a legitimate question meriting an extended answer to avoid confusion. 

Strategic planning is an important component of succession planning and is one of the ten interdependent factors of the Succession Matrix® that also includes: Owner Motivation and Perspective; Successor Identification and Preparation; Key Manager Motivation and Retention; Teamwork and Synergy; Business Structuring; Personal Financial Planning; Family Governance; Leadership and Management Continuity and Family Communication and Harmony. Each of these factors and their interdependence are explained in more detail on our website.

To start with, let’s address the similarities between strategic planning and succession planning that had led many to confuse the two. Both of these initiatives involve teamwork among a diverse group who has a vested interest in the success of the event. Both teams work together to confirm a vision for the business. They review and confirm goals and develop a plan for the achievement of those goals.  Both endeavors identify the issues that will impact their goals and consider the resources available to them to address these issues and support the achievement of the goals.  Both initiatives address “Reality Alignment,” which is the adjustment/refinement/modification of goals and/or the action steps needed to attain these goals so that they are more in line with what can actually happen and get done. And similarly, both initiatives articulate action steps for the achievement of the goals.  Recognizing that “buy-in”, unity and teamwork are critical to both initiates, these diverse action steps are reviewed, refined and approved by advisers and key managers who are instrumental to the fulfillment of the action. And finally, due to interdependence, both strategic and succession planning require accountability that the action steps are being addressed in a timely and effective manner. An independent, fee-based facilitator is needed for either endeavor to ensure all assigned action steps are being addressed and that coordination among the team members is being achieved. And finally, both initiatives require regular review and refinement to assure adaptation with constantly changing circumstances. 

As I have most likely just added to the confusion between the two by pointing out all their similarities, we will consider the differences between strategic planning and succession planning in my next two posts, Strategic Planning and Succession Planning: Different Goals and Teams and Strategic Planning and Succession Planning: Expertise and Time Frames.

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