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Unless No One Gets Sick, Quits, or Dies, A Plan’s in Order

by
Tony Kubica and Sara LaForest
Mar 13, 2012, 5:24 am ET

Does your organization have a succession program in place? Too many organizations and small businesses default to the practice of reactionary assignment of a successor amid a now-glaringly-vacant position, or embark on a rushed external hire that often ends up as a high cost disappointment from a ”hiring misfire.” The consequences are not only expensive but are also a missed opportunity due to lack of focus and the inability to support fast growth.

And this is the challenge for recruiters: urgent hires, and the inability to explain the succession process (i.e. growth potential) to candidates, as well as to current employees who are looking to build their career. Recruiters can have an important role in helping leadership address the issue of succession readiness.

A succession strategy is about having an identified plan to fill key positions within your organization. A succession program is the implemented process of identifying, developing, and transitioning potential successors for the company’s present and future key roles, aligned with the talent and ambition of its current employees and talent network.

A common error that we see in succession planning is to target only the key executive roles (CEO, COO, CFO). This is a significant risk unless you are a micro business. For example, if you are in the construction or transportation industry, a logistics manager may be critical for the success of your business. Having a vacancy in this position could quickly result in a decrease in service and an increase in customer complaints, and possibly a decrease in customer retention.

This is why critical positions across the business need to be identified and replacement processes planned.

In our work with companies we hear some common arguments and justifications. We repeatedly see that the president or key executive doesn’t believe there is an immediate need for a succession plan. Their stated arguments are, “we’re too small,” “we’re too new,” “we already have good people in place,” or “I’m not going anywhere soon!”

In an unlikely static environment where no one leaves, no one gets ill (including the owner, president, or senior managers), growth isn’t that important, and performance is exceptional — these arguments hold true. But, we don’t live in a static business environment. People do leave, they do get sick, the executives need to focus on growing the business verses operating it, the employees are not all good performers, and some roles are hard to fill!

There is also a tendency to hold on to marginal performers because there is no clear plan on how to replace them. The impact: the business suffers, the executives suffer, employee morale and productivity decreases, the customers become less than satisfied with their service, and new candidates are not attracted to your company.

When organizations do not have a succession program in place, consequences include:

  • Knee-jerk replacements — either unsuitable hires or “not ready for prime time” promotions that end poorly due to lack of suitability, development, and transition support
  • Retention challenges — the best talent leaves to pursue growth and other opportunities as they do not sense an opportunity at your company to advance in alignment with their career aspirations
  • Unnecessary costs during crises, or perpetual recruiting and training
  • Disruption to the work culture/environment, meaning that a sense of stress, discord, competition, and posturing for position will manifest in employees and could embed (negatively) in your culture
  • No or poor bench strength to deliver (let alone to grow)

To help decipher their organization’s succession readiness, start with these four questions:

  1. Do you have a people-related plan to support the growth initiatives?
  2. Do you have current and relevant job descriptions to establish expectations, role clarity, and accountability of your workforce/talent?
  3. Do you have an identified talent pipeline (candidates by talent areas and for the key positions)?
  4. Do you have a process or structure in place for identifying and developing those high-potential, “promising” employees who fill the talent pipeline?

Building a succession program is like any other business initiative; it has two components: strategy and implementation.

Building Your Strategy

  1. The first step in succession readiness is to recognize and accept that responsibility for it must sit with the top executive as part of their job description and performance review. Many organizations with effective succession programs include this metric for all their key executives.
  2. The executive team or designated committee needs to explicitly identify current and future key roles and core talent areas that are needed to run the company and to support growth initiatives. This includes: A) Identifying an interim process if there is an emergency absence of a key position; and B) Anticipating future growth and the required talent needed to support it. This will also help you align your recruiting efforts by focusing on interviewing candidates for growth potential and adaptability to address and support the future growth needs of the organization.

Implementing Your Plan 

  1. Management needs to gather information and track high-potential employees. This includes not only their performance in their current role but also their commitment to the organization and their career growth ambition. There is a risk that high-potential employees will leave, as they are the quickest to explore and pursue something better. They are also very attractive to your competitors. While seemingly obvious, but unfortunately frequently overlooked, management must practice quality employee performance reviews in order to learn, gather, and track information on the potential successor candidates (aka maintaining the talent pool or pipeline).
  2. The organization will need to either develop or adopt existing methods, tools, and techniques to identify employee competencies and aspirations, such as using talent management systems, talent assessments, or business personality and performance indicators, as a means to further assess and develop candidates. This can be done quite efficiently and accurately through candidate feedback and electronic assessments.
  3. After assessing and capturing employee capabilities, competencies, and aspirations, you need to implement a structure and process for developing potential successors. Progressive organizations have formal Emerging Leaders programs.
  4. At the point your internal candidates are promoted, we recommend a three- to six-month (minimum) active mentoring and/or coaching process to best transition successors into their new role.
  5. Lastly, review and evaluate your succession program’s effectiveness annually and update it as required. Consider measurements like number of promotions, employee retention, and reduced recruiting costs in reviewing the effectiveness of your succession program.

Four Tips to Help You Identify and Develop Your Talent Pool and Potential Successors

  1. Keep a pulse on the talent network in your industry. They may be enticed to join your organization based on the opportunity it provides to grow and advance.
  2. Develop and maintain a learning organization by integrating regular formal and informal training and skill development to promote a growth mindset among employees (i.e., targeted courses, seminars, workshops, conferences, professional association sponsored programs, e-learning, in-house brown bag lunch knowledge meetings, peer group exchanges, etc.)
  3. Entrench the practice of management delegation above micro management. Make sure to give assignments that require demonstration of skills (enable the candidate to learn new skills) to develop and apply skills that will be required by managers in your company. (Candidates should have an opportunity to make and “live” with their recommendations.)
  4. Make sure your performance review and appraisal system is more than a once-a-year monologue. Conduct at least semi-annual reviews to stay in touch with the candidate’s performance. This can also include selective 360-degree reviews to focus on skills learned, skills demonstrated, skills to be learned, what went well, what can be done better, professional and career goals, and how the colleagues see the candidates performance and behavior, derived from the 360-degree review.

While often overlooked or misunderstood, succession planning is an important component for business growth and organizational sustainability and success. Whether your organization has a formal plan or an informal plan is less important than that it has a plan, which is worked on throughout the year.

Business growth needs people to support it and recruiters are key to the people strategy. Understanding and helping your organization refine who you need now and in the future and who will replace key positions is an important and necessary growth strategy. Recruiters play a critical role in helping insure the right talent in the right area to carry the organization forward to manifest the success of its business strategy.

photo from Bigstock

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  1. Succession Planning and Career Development « abrownhrpro

    [...] pays off! 3 days ago Follow @ABrownHR ERE.net- Recruiting NewsUnless No One Gets Sick, Quits, or Dies, A Plan’s in Order March 13, 2012Does your organization have a succession program in place? Too many organizations and [...]

  2. Keith Halperin

    Who’s at a company long enough these to be concerned with a succession plan? You only need to concern yourself with them until you or they leave, which isn’t very long.

    Cheers,
    Keith

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