The transition planning every business can benefit from

AT A GLANCE

• 82% of what a transition-readiness review uncovers are operating improvements that can strengthen the business today
• Fewer than one in three CEOs within 10 years of a planned transition have a documented succession plan
• Fewer than one in five have discussed transition planning with their bank
• The businesses that start planning years in advance are often better positioned for growth, leadership continuity, and future opportunities

For many business owners, succession planning feels like a future problem. If a transition is years away, it's easy to put the conversation off.

But recent research on CEO strategy and risk suggests many leaders may be looking at succession planning the wrong way. When middle-market companies complete a transition-readiness review, 82% of what it uncovers are ordinary operating improvements that can make the business stronger regardless of whether a transition occurs.

That includes improving financial reporting, developing management depth, addressing customer concentration, documenting key processes, and reducing operational dependencies. These are the same improvements many businesses would prioritize as part of a long-term growth strategy.

In other words, preparing for a future transition often means building a better business today.

The challenge isn't recognizing the value of preparation. It's starting early enough to benefit from it.

The research found that fewer than one in three CEOs within 10 years of an intended transition have a documented plan, and fewer than one in five have discussed a transition with their bank. In fact, most preparation efforts begin within 24 months of the event itself.

While 24 months may be enough time to organize documents or address immediate needs, it often isn't enough time to make meaningful operational changes.

Companies that begin reviewing readiness five or more years in advance have the opportunity to identify gaps, implement improvements, and realize the benefits while they still own and operate the business.

Those improvements often include:

• Developing stronger leadership teams
• Improving decision-making through better reporting
• Reducing business concentration risk
• Strengthening operational processes
• Creating greater organizational resilience

The result is often a company that’s easier to manage, more efficient, and better positioned for long-term success.

Many readiness issues can be improved with focused attention and investment. Financial reporting can be strengthened. Processes can be documented. Customer concentration can be addressed over time. But leadership development is different.

One of the most important factors in any transition is whether the business can operate successfully without the owner at the center of every decision. Developing future leaders, transferring knowledge, and building organizational confidence takes time, making it difficult to accelerate that process during the final stages of a transition.

That’s why many of the most successful succession plans begin years before they're needed.

Many owners assume a readiness review focuses primarily on how to sell, transfer, or exit a business. In reality, the review is often much more operational. Key questions typically include:

Can the business demonstrate strong financial performance?
This includes timely financial reporting, realistic budgets, reliable forecasts, and clear financial visibility.

Can the company operate without depending on one individual?
A strong management team, clear decision-making authority, and leadership continuity can help ensure the business remains stable through change.

Where are the business's greatest risks?
Customer concentration, supplier dependencies, and key-person risk can all affect long-term business value and stability.

Are business and personal plans aligned?
Ownership transitions often bring together business goals, personal financial objectives, liquidity planning, and estate considerations. Understanding how those pieces fit together can help create a smoother path forward.

Answering these questions doesn’t require an owner to decide when or how a transition will occur. It simply provides a clearer picture of where the business stands today.

One of the most interesting findings from the research is that companies frequently benefit from readiness planning regardless of whether a transition actually takes place.

Organizations that improve reporting gain better visibility into performance. Leadership development reduces reliance on a single individual. Stronger processes improve consistency and scalability. Risk management efforts strengthen the company's foundation. The same improvements that support a future transition can also support growth, profitability, and operational effectiveness.

That's why succession planning is increasingly being viewed as a business planning exercise rather than solely an ownership discussion. Having the pieces in place, no matter what the future holds, is a competitive advantage few are capturing.

As you think about the future of your company, consider these questions:

• If a readiness review were conducted today, what would it reveal?
• Who leads the business when the current CEO is unavailable?
• Are your financial reporting and planning processes supporting future growth?
• Where does your organization face concentration or key-person risk?
• Have the business’s goals and leadership’s personal objectives been considered together?

The answers can help identify opportunities to strengthen the business today while preparing for whatever comes next.

Succession planning touches more than ownership. It affects business operations, leadership development, capital planning, risk management, and personal financial goals. That's why effective planning often starts with a conversation rather than a transaction.

At M&T Bank, we work with business owners to evaluate both the business and personal sides of long-term planning. By bringing together commercial banking capabilities and wealth-planning expertise, owners can gain a clearer understanding of where they are today, identify areas for improvement, and prepare for future opportunities.

Because the companies that navigate ownership transitions most successfully aren’t the ones who have been planning to leave the longest. They simply decided to find out where they stood and made improvements long before they had to.

Contact your relationship manager to learn more or set up a discussion.

Source: Sawbux 2026 CEO Strategy and Risk Survey