Succession management has been on the top of every HR professional and business leaders’ list for years. Technology allows us today to create huge transparency around talent across all lines of business. The aim of succession management is simple: to continually strengthen our internal employee capabilities as well as refine suitable pools of employees by tailoring their knowledge, skills, and abilities for roles in the organization.
As HR professionals, we know that this is very important, as succession management ensures that talents are developed and trained employees are ready and able to step into new roles. Another plus: It also ensures and maintains long-term organizational growth especially as we are in a VUCA (volatile, uncertain, complex, and ambiguous) world.
We need to prepare and plan, and we need succession management. Through smooth succession planning this ensures fast access to internal talents, opens concrete career opportunities for employees, and enables fast reactions to new business models. That is a great model to have. So why do we still fail to get it right?
While this definition seems easy enough, much time has already been spent in ferocious discussions. Despite these efforts, the outcome is moderate.
Even at the highest level of organizations, succession plans are rarely concrete. Each time a position becomes open and we go through the succession short list, discussion starts to get animated. The question is: Why are we still not able to make our succession plans reality? And where are the gaps or inefficiencies that have hindered this process?
Surprisingly, the research shows that “two-thirds of US public and private companies still admit that they have no formal CEO succession plan in place”, according to a survey conducted by the National Association of Corporate Directors last year (CEO succession starts with developing your leaders.
As HR professionals, we also know that succession management takes years, not months or days – so preparation is key.
According to a 2014 Senior Executive Report on Succession Planning and Talent Development by the Institute of Executive Development and the Rock Center for Corporate Governance at Stanford University, only 46% of respondents have a formal process for developing successor candidates for key executive positions. Additionally, only 25% of respondents agreed that there was an adequate pool of ready successor candidates for the CEO position at their companies!
Main reasons for failure
According to my experience, the main reasons for this are:
- The listed talents are not ready
- The role has shifted focus and priorities revised
- The decision-making committee has enlarged
This means we must again critically assess our succession management approach and do some things fundamentally differently. In these times of fast change, workforce planning becomes crucial. A smooth succession management process would ensure fast access to internal talents, open concrete career opportunities for employees, and enable fast reaction to new business models.
Here are a couple of easy ways to respond to this:
1. Involve all decision makers from the beginning
One important exercise is to carefully consider the full list of decision makers, and involve them all from the beginning. For example, very often the direct manager of the position is involved, while the next level manager, business unit leader, or board member is not. If, 12 months later, the direct position holder changes their role, there is nobody left in that organization that gave their explicit commitment in the beginning, which in turn reduces the likelihood the previously identified successor will be selected.
In addition, once identified, it should be very transparent to the successor. Open lines of communication with potential candidates are important to minimize any unexpected surprises in the future. When potential successors participate in the process, you can guarantee transparency and acceptance from the beginning and ensure a smooth transitional process. The position holder should give a clear commitment toward direct managers and successors, and direct managers should give a clear commitment to help the successor build and accomplish a development plan to prepare.
2. Focus on future skills
Invest in the development of employees focusing on future skills, as opposed to focusing only on current role models. Define future role profiles, anticipating which competences and skills will be increasingly relevant in the future. Involve your business leaders in the process to ensure that it does not become an academic exercise. Once the key 3-5 future skills are identified, direct managers of the identified successors should play an active role in building an individualized development plan that is targeted to fill the gap. Business-wise, this makes management proactive and prepared.
3. Assign talents a sponsor out of the influencers of the decision maker committee
One of the priorities for the decision-making committee should be to identify catalysts in the organization. It is with this that the chosen executive sponsor should be committed in grooming these talents to develop in their career and ensuring the success of these talents.
In conclusion, succession management and planning, while not impossible, requires us as HR professionals, leaders, managers, and executives to critically challenge ourselves, to review the impact that our succession management practices have, and change the necessarily elements that are in our control. Being strategic influencers at the beginning of the process will yield succession plans that are more realistic and of true value to the business.
For more insight on hiring strategies, see How HR Professionals Use Technology To Hire The Best Candidates.