JPMorgan Chase CEO Jamie Dimon's revelation that he has throat cancer shook up the business world Wednesday. Luckily for the leader of the U.S.'s largest bank, doctors detected the cancer early and called the condition "curable."
Dimon said in a memo to employees he would not stop working on day-to-day operations at JPMorgan, but his illness raises an important question for entrepreneurs: How do you manage your business when you get sick?
As Inc. reported last month, contingency plans and succession plans are vital to keep your business going if you have to step away due to an illness. A contingency plan outlines what you would do if all of your optimistic plans went wrong, while a succession plan provides for the continued operation of a business in the event that the owner--or a key member of the management team--leaves the company, is terminated, becomes incapacitated, retires, or dies.
Still, most business owners haven't thought that far ahead. Two thirds of companies lack a succession plan, according to U.S. Trust's 2014 Insights on Wealth and Worth Survey, which polled 680 people throughout the U.S. with investable assets of at least $3 million.
The reason for the oversight may be that a business owner doesn’t want to confront his or her own mortality, is reluctant to choose a successor, or does not have many interests beyond the business, Inc. previously reported.
"The economic costs are significant," stated James Bieneman in Business First-Columbus. "[But] the human costs are even greater in terms of spoiled family relationships, missed career opportunities, and the discomfort of living in a state of misalignment.
Getting the proper plans in place may simply be a matter of careful consideration--that is, in other words, you need to sit down and force yourself to think about what happens to your business if something happens to you.
It may also come down to asking for help. According to the U.S. Trust report, entrepreneurs with a financial advisor are more than twice as likely to have a succession plan.
But even after you jump through this initial planning hoop, proper succession and contingency plans will need to be re-examined regularly as your business grows. As John Thiel, head of Merrill Lynch Wealth Management, told Inc. in 2012, succession planning is not a one-and-done task.
“The best succession planning strategies evolve and require frequent evaluation," he said. "A transfer of ownership or management could happen on a timeline as planned, or come as a result of sudden or unforeseen circumstances.” The same is true for contingency plans. If, say, your contingency plan calls for holding your important business documents in a safe at your home, you might want to rethink this strategy as better (safer) technologies evolve.
In the end, ask yourself: If you had to temporarily or permanently leave your company, would your business be prepared for a seamless transition? If your answer is no, you'd better get to work.