Hartford Business Journal

22 Hartford Business Journal • February 24, 2020 • www.HartfordBusiness.com B udding entrepreneurs face a number of challenges when preparing to bring their dreams to fruition. As they create a business plan, assemble a board of directors and or- ganize finances for a company, there is another critical task to consider: who else will eventually assume the leadership role? According to Kevin C. Leahy, CPA, CFP®, president and CEO of Connecticut Wealth Management, succession plan- ning — the process by which a business owner transfers a business to someone else or some other entity — should be- gin the moment the company is created. To determine the ulti- mate goal, entrepreneurs need to ask some questions. Will the company operate in perpetuity? Is the goal to build a business that will sell for the highest price? "Depending on the answer, what happens next could be very different," Leahy said. Forward-thinking individuals would be wise to take a long-term view of the company and set up a structure that ensures a successor will be in place when the time comes, said Denis M. Horrigan, CFP®, co-founder, Connecticut Wealth Management. "Planning needs to be done. You can't just work quarter-to-quarter or year-to-year," he added. Family-owned businesses usually expect to pass the reins from one generation to the next. However, any suc- cessor must embrace the same passion as the founder and have the ability to actually lead the company. Leahy pointed out that a successful company with many long-time em- ployees might be disheartened if a dispassionate or inad- equately prepared family member assumes leadership. Planning is key While many entrepreneurs think of succession planning in relation to retirement, other situations, such as disability and untimely death, also require advance preparation. "You should purchase life and disability insurance to ensure that the company has money to continue operations and the family and owners of the company have enough money to live the lives they desire," Leahy said. "Above and beyond that, it's important not just to prepare financially, but also to ensure that the proper management team is in place and the company is not reliant on one person." S P O N S O R E D C O N T E N T T H O U G H T L E A D E R S H I P Succession Planning: Early Preparation Maximizes Outcomes Kevin C. Leahy, president and CEO of Connecticut Wealth Management (l), and co-founder Denis M. Horrigan emphasize the importance of early planning to ensure a smooth leadership transition.

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