Succession Planning
Many presidents and leaders of firms have a multitude of issues demanding their attention, yet one of the most significant for the long - term success of the firm is likely not even on their agenda. The issue of identifying and developing the firm's future leaders is a matter that can not be delayed. Given that many baby boomers will be retiring, the next ten years will be a critical time frame for firms to have their house in order key for management, technical, marketing and administrative positions. It will not be enough to concentrate only on senior positions. Mid-management and supervisory roles must also be considered. Executives are not cultivating the talent required to fill existing positions, not to mention the ability to have the personnel to capitalize on new business opportunities or developing markets.
One method to address a firm's future requirements is to work closely with the HR department and identify retirement dates for employees in "high risk" positions critical to the company's success. Another factor affecting succession planning is the state of the economy. In an improving economy where employment opportunities increase, high calibre candidates will leave, depleting the existing talent pool, and placing further pressure on the company's existing personnel and resources. The same result happens in a weakening economy: as firms lay staff off, the talent pool becomes depleted and places undue pressure on remaining resources.
Succession planning and retention will become parallel strategies. It is one thing to identify who is available to fill positions, and entirely another issue to ensure people will be there when required. Having a defined succession plan and employee profiles including a summary of their goals, aspirations and desires is essential to proactively manage the process prepare the resource required.
Firms that take this seriously are identifying the competencies necessary for success within all key positions in the organization. Competencies such as leadership, planning and organization, coaching and employee development, performance management, financial management, customer focus, communication skills are being used as the basis against which employees are being evaluated for their potential.
This process is being further enhanced by the creation of personality style/traits profiles. Psychometric assessments can provide valuable information to help identify high potential performers best suited for specific jobs and tasks. For example, if high levels of sociability, detail orientation or patience are required for a specific role, a profile can be created against which employees can be assessed. This not only helps take the guess work out of evaluating successors but also provides significant assurance that the candidate will have a strong, even above-average, probability of success.
The process is more complicated than simply identifying competencies and preparing personality profiles. A structured training and development plan is also required to ensure employees are developed to be competent, assume more responsibility and ascend the corporate ladder. Again, HR should be a partner in the development of the training programs.
A note of caution is required when preparing a succession strategy. Too often managers will identify individuals similar to themselves as being the perfect successor. Others, such as peers, subordinates and senior management can provide important input to the skills and behaviours required and objectivity to avoid biased or one-sided hiring. This approach will also encourage people from within the firm to apply for positions. Employees reach their own conclusions on their potential for becoming a candidate when they see the competencies, skills and training required for the role.
For the succession plan to work, a strong commitment is required from the president. Without this, critical and future defining issues will be left to chance or decisions will be made out of necessity largely based on emotions and lack of a plan, resulting in potential corporate disaster.