Succession Planning in 5 Steps
40%-60% of baby boomers will retire in the next ten year. Do you have a plan for succession? How will the baton be passed from today’s leaders to tomorrow’s? According to a survey conducted by Development Dimensions International, only 11% of current leaders indicated they were groomed to be a leader through a formal development program within their organization. It’s vital to prepare for the loss of key leaders who may leave suddenly for many reasons, including retirement, poor performance, resignation, illness or death. You can create a competitive edge by having a succession plan in place.
Key Benefits of a Succession Plan Include:
- Ensures long-term viability of the organization
- Keeps younger talent engaged and motivated
- Provides a stable workplace environment, attracting new talent
- Reduces financial risk when the unexpected happens
- Builds a pool of outstanding leadership talent
- Pass on key skills and business relationships
5 Steps For An Effective Succession Plan
1) Change the name. “Succession Planning” implies a negative outcome and highlights the mortality of the incumbent. Names like “Succession Development” or “Leadership Development” focus positively on the future.
2) Engage future leaders. Involve multi-generational talent in the creation of long-term strategies and priorities. Enrolling future leaders in the process of creating enterprise value rather than just a process of determining tomorrow’s leader will produce superior immediate and long-term results. Remember, it is important to have an internal pipeline of future leaders rather than needing to go outside for a leader.
3) Measure the outcome. Setting goals and evaluative metrics will provide a scorecard of progress toward the selection of an eventual successor.
4) Keep it simple. Don’t over-analyze, over-evaluate, or drag the process out for years.
5) Hire an outside consultant. It is usually impossible to find someone internally who has the time, expertise, experience, and unbiased perspective to lead the succession planning effort. An independent, no-agenda consultant can provide the entire organization with the confidence of future certainty and control. Succession planning must be transparent, perceived as fair, and in the best interests of the company to be successful. We at SharedHR specialize in providing unbiased succession planning strategies.
12 Key Questions to Ask
1) What type of leadership will the company need in 5 or 10 years?
2) What new opportunities will the company likely pursue?
3) What will be tomorrow’s value proposition?
4) What is the company seeking to accomplish or achieve?
5) What talents or skills will be needed 5 to 10 years from today?
6) What organizational changes may be needed as a result of succession?
7) What weighted, evaluative criteria will be used to assess potential candidates?
8) Who will be involved in the selection process? What training or assistance will they need before the process begins?
9) Who will lead this process?
10) What is the anticipated timeline for transition?
11) Is the company willing to look outside for prospective candidates?
12) Is the company willing to hire an experienced outside consultant?