Succession planning should be approached in a thoughtful, organized way
If something were to happen to you tomorrow, who would lead your organization? Departures of senior and mid-level managers have been a wake-up call for many businesses. This trend is projected to continue as the Bureau for Labor Statistics reports that overall labor force participation rates are on the decline. Between 1996 and 2006, the population of people between the ages of 55 and 64 increased by 54 percent, while those between 25 and 34 experienced a net decrease of 8.8 percent. Corporate observers are predicting that more than 20 percent of all senior executives will be nearing retirement in the next five years.
If you study businesses that are consistently successful, such as Dell, Intel, GE and Allied Signal, you’ll find that their leaders are intensely focused on creating a leadership pipeline. For executives, the ultimate test is not whether he or she makes smart decisions and takes decisive action, but whether he or she teaches others to be leaders and builds an organization that can sustain success even when he or she is not around.
Leaders who look for depth within their organization and value succession planning create the ability to promote within. Their leadership style benefits the individual and the business. Many organizations adopt a “natural selection” strategy where executives assume that there are “born leaders” who have the right stuff and that there is a kind of natural selection process that assures that only the fittest survive. This approach has an inherent reliance on hiring individuals from the outside if not enough people bubble up from within the organization. This approach can be unfair to employees because chance plays a significant role in determining who gets opportunities to cultivate their skills with increasing levels of responsibility earlier in their careers. At the same time, individuals who have considerable innate skills get trapped in organizational silos or can be overlooked because management doesn’t know them. Without immediate opportunities for growth within the organization, people will seek opportunities elsewhere, causing a talent drain.
However, this mostly untapped pool can be transformed if nurtured throughout the organization. The “nurture model” is used by proactive organizations that invest in growing their future leaders from within. They do this by identifying people with leadership potential and attempt to nurture their skills and other attributes. This approach is similar to operating a “farm club” for a professional baseball team. These organizations attempt to find people with potential and, with coaching and training, gradually move them up to increasingly important and varied leadership positions until they reach the top executive ranks.
Consider these steps for developing your succession plan:
• Evaluate the existing resources in your organization
• Analyze your role and job functions within the organization and the value you create
• Study the people in your organization and determine who could do your job
• Select the people you think could do the job and have them do a self-assessment
• Compare your job description with potential successors and develop a plan to address the skill gaps
• Create a mentoring and skill development program to groom candidates
The time to start planning is now. Creation of a leadership pipeline ensures continuity for your business and a future direction. The quality and skills of your team is the best competitive differentiator. No matter what your age, succession planning should be a priority if you want your business to succeed.
Dr. Lisa Edwards is the executive dean of Workforce Development & Continuing Education at Clark College.