Succession Planning – Part 2

It Worked for Us and Can Work for You

As we discussed in part 1 of this series, PBO Advisory recently went through our own succession planning process, and we wanted to share our experience. Succession planning is a service we’ve offered for several years. Viewing succession planning through the lens of an organization actually going through the process gave us a different, and unique, perspective.

Succession planning is a process that typically leads to a business transition, such as a sale to a third party, management, or employees (ESOP); key executives taking over leadership roles; or younger members of a family continuing a legacy. In our case, PBO Advisory Founder Mike Ford spent time thinking about what he wanted next for our company and for himself. He ultimately decided to retain majority ownership but position himself in a new role to concentrate on growing our business nationally. To take over Mike’s role as CEO, Francesca San Diego, our then CFO, was selected. In January 2024, the transition of leadership took effect.

Of course, there were a lot of steps in between Mike’s contemplations and Fran taking the reins, including changes in personnel, services offerings, and growth strategies — to name a few. Those steps were carefully planned out and then implemented over the course of a couple of years, with several adjustments along the way.

What to Plan

Your goals are the foundation of the transition and drive all aspects of it. A plan is a living document that evolves as time goes on. Changes will cause reverberations to other aspects of the plan. This is why planning should start early, at least two years from the transition date, if not more. This will give you time to hone your strategies, map executional actions to achieve your goals, and pivot to new options, as needed.

Many factors go into planning and having someone on your succession team who has experience in planning a transition can save time and heartache. Bringing in outside professionals is a good option.

A plan can be simple, complex, or somewhere in between. Mike describes our plan as fairly simple, focusing on WHO would be part of the succession team, WHAT services we should focus on over the next few years, and WHERE we will find strategic partners to help us implement new strategies.

Planning is not one size fits all. Each plan is different. Here are four of the critical areas that need to be addressed in most succession planning processes:


Most owners planning to sell or transition typically want to get the highest value for the business. Plans often include significant focus on the steps that will help reach the goal of maximizing company value. While making more money right away is one strategy, a demonstrated trend of higher earnings is even better for increasing value. This, of course, takes time and is another reason for starting early.

With her extensive background in finance, Fran recommends that businesses focus on improving multipliers when increasing value. This will have a greater impact on valuation than an improvement in earnings. (Multipliers are measurement tools that evaluate one financial metric as a ratio to another and makes comparing the value of different companies more efficient.)

Factors that positively influence your multiplier(s) are a sustainable record of growth in revenue and customers, the in-place management team, strong IP, and a solid brand.  Multipliers include tangibles such as an accounting system and financial statements, as well as intangibles such as personnel, customers, and company structure.

A CFO, either on your staff or a fractional CFO, can help with the valuation process and developing the value portion of your plan. Fran and other C-level members of the PBO Advisory team were instrumental in the value and financial aspects of our planning.


Solid operations increase the value of a company. These include well-defined and documented internal processes, a highly scalable overhead structure, a solid project management approach, strong contract administration, and up-to-date, off-the-shelf, widely used software.

Buyers need to understand how your company operates. Fran suggests explaining your operations in terms of your financial results to tell a more complete story of your business. This strategy ties together key areas of the business and makes clear how operations relate to value.

If certain aspects of your operations need fixing, these should be top priority for improvement in your succession plan. Allowing enough time for implementation of your operational goals will let you fix the issues and demonstrate results vs. a Band Aid approach that could result in unpredictable ramifications.


Company culture is a mix of history, values, priorities, and vision. A company with a high-producing, long-term management team is going to be more attractive and yield a better transition. While it is hard to put a value on culture, it is still an important component of succession planning.

As PBO Advisory planned our future, our history played a big role. The new priorities and goals we set required us to look at our past successes and weaknesses. We needed to evaluate which members of our team embraced our new vision for our company and if changes needed to be made. Did the current company values align with where we wanted to go or did they need to evolve to support what was next?

Making cultural changes can be painful but may be needed during succession planning to fully realize the transition you want.  Identifying a succession plan that integrates the existing company culture supports the company and helps its people navigate change more seamlessly.

For a professional services firm like ours, people are our product. Strong people will gravitate to a company that has a defined culture, as well as solid operations.

Human Capital

Our people are our most important asset. Businesses are made up of the people who do the work. A strong succession plan considers the impact on its people. Human capital plays an important role in transitions.

We’ve turned to the expertise of PBO Advisory’s Nicole Devine, our Consulting Chief People Officer, for part 3 of this article, which will go in-depth on human capital issues as part of succession planning.

For more information on succession planning, please reach out to Mike Ford or Francesca San Diego.

Mike Ford

President & Founder



Francesca San Diego
CEO & Member
(858) 935-4846