What is Succession Planning or Replacement Planning?

One of biggest misconceptions is that succession planning and estate planning are one in the same. Succession planning (aka replacement planning) directly relates to the actual business itself. Whereas, estate planning relates to your ownership interest in the business. Succession planning is the process of identifying new leaders to replace the old ones. It involves strategizing who will lead the business after a company’s most important people move on to other opportunities, retire, or pass away. Succession planning often involves training the new leaders so that they develop the necessary skills and gain a global understanding of the company for when it is their time to replace the older leaders.