Shop floor to CEO: Succession planning for manufacturers
In the fourth of a series of blogs looking at the manufacturing sector, Moore and Smalley’s Ginni Cooper offers advice for identifying and grooming the next generation of leaders.
Management buy-outs (MBOs) are popular among owner-managers of manufacturing firms who want to pass on what they have built to people they know and can trust.
MBOs enable retiring owners to get the personal satisfaction of knowing the ethos of their business will be preserved, while rewarding the people who have played a major part in its success.
This means it is essential to ‘home-grow’ a management team capable of running the businesses, which in turn means promoting your best people from the shop floor.
The right skills
Identifying individuals with management potential is not straightforward. Technical abilities are rightly given a high priority in the manufacturing industry, although owners should place equal store by leadership qualities, commercial awareness, and organisational skills.
Nor should owners underestimate the challenges faced by MBO team members who were previously ‘one of the lads’ or ‘one of the girls’. This perception can’t be shaken off overnight and it is essential to give promoted individuals sufficient time to gain the leadership qualities they need and readjust their relationships with former shop floor colleagues.
Mentoring future leaders
The grooming of future managers, and eventual owners, is a long term process that requires careful thought and investment. Managerial candidates can acquire the self-confidence, technical skills and leadership capabilities through a range of options.
In-house mentoring sessions involving the owner and promoted managers are an effective way of passing on the commercial savvy needed to take the helm. However, sometimes external input is needed and business coaching consultants across the region offer one-on-one programmes tailored to the development needs of individuals.
Addressing gaps in academic success
In addition, foundation degrees, HNDs and HNCs in business management are available from numerous regional educational institutions and special care is taken to make the process accessible to budding managers with limited academic experience.
Ultimately, the strength of your management team will play a key role the decision-making process of a potential MBO investor – the stronger your managers, the greater the value of your business.
For more information, contact Ginni Cooper on 01772 821021.