Can your business survive without you? (column)

Can your business survive without you?

DENVER, Colo -- What would happen to your business if you, the owner, had a freak accident and could no longer run it?

The Fails Management Institute recently surveyed private construction firm owners on management succession and ownership transfer. Below are three of the questions and their responses.

Q. What would happen to your company if you were hit by the proverbial "red truck" tomorrow morning?

A. The family would inherit the business (65%).

Q. Would the business survive without you?

A. Yes (83%).

Q. Is there anyone -- a "Prince(ss) Charming" -- currently in your employ, who could run the business in your absence?

A. No (79%).

These responses say a lot about the lack of adequate contingency or "death" planning by contractors. Plans are frequently vague and, in most cases, the owner doesn't know what would happen "if."

In practice, only one out of five construction firms will survive into the next generation.

FMI was recently summoned to the office of a large general contractor, run by a second-generation son, to discuss issues related to stock transfer and organization planning. When asked what would happen to his stock if the old red truck got him, neither he, his chief financial officer, nor his…