July 2024: Succession Planning; Part I

The truth is all organizations have two sources of irreplaceable knowledge – people and databases. If either is lost, years of insight can be erased instantly. While many leaders recognize the importance of implementing data backup plans, fewer appreciate the critical necessity of developing succession plans that foster the transfer of knowledge from person to person long before any departure. This Part 1 installment on Succession Planning will lay a framework that promotes an ongoing mindset geared towards future leadership and succession.

Succession planning should start by identifying the vital roles that keep an organization thriving and creating a diverse talent pipeline. Typically, these roles will be the CEO, the Management Team, and Board. The goal is to ensure a smooth transition when key leaders or employees leave – talent management is critical. Here are four proactive strategies to plan for the future.

1) Be Deliberate and Proactive

A big obstacle to overcome when succession planning is changing people’s perceptions. Start by educating the leadership team on why it is vital to address it now and why to not put it off. Even if retention is high, planning is a continuous process. Internal knowledge needs to be captured long before a replacement is necessary. Succession planning can also be positioned as an opportunity for employees to build their own career path.

2) Identify Future Leaders Early

The process takes time, which is why replacements need to be identified early. The average number of years an employee stays with a company has decreased, so it is best to identify multiple potential leaders. This will protect your business in the event critical employees leave. Because of current environments, you may have lost key players and need to reevaluate key roles and replacements.

When looking for leaders, technical aptitude alone is not the determining factor. Each level of seniority (CEO, CFO, Regional Managers, etc.) has its criteria. Still, leaders need a wide range of traits such as strategic problem-solving, adaptability, and must be forward-thinkers (to name a few). These questions can help determine if a candidate embodies any of these qualities:

• Are they engaged? Did they participate in strategic problem-solving?
• Do they align with the company vision? Are they focused on the future?
• Are they open to new ideas? Do they share ideas with others? Are they quick to adapt?
• Do they inspire others? Do they understand what motivates the team?
• Do they communicate well? Do they strive for clarity?
• Are they a good cultural fit? Are they likely to remain part of the company?

Remember, candidates do not need to be ready now. You are not necessarily tapping the potential for now. You are looking for someone with room to grow. Look for the potential and then foster it as you train and test them to be future leaders.

3) Determine How to Measure Readiness

When looking for internal talent, evaluate each candidate’s innate skills and aptitudes. Understand which needs refinement and which needs nurturing. Also, consider any missing skill sets and how to foster them.

When evaluating readiness, make sure the candidate is dedicated and aligns themselves with the strategic direction of the organization. These two questions will help gauge readiness:

How is this employee perceived internally?

During this assessment, understand how they interact with others. Do they demonstrate leadership skills and confidence? Look at this individual through the eyes of the coworkers and leaders they interact with daily. Get feedback from peers, supervisors, and even customers.

What are their unique characteristics? What are their motivations, interests, and values?

When asking these questions, look at their job positions, how they have handled incremental challenges, and how their career has developed. Ideally, throughout their career, they have grown by rising through the ranks, taken on more responsibility, and worked hard.

Once this person is on a clear path to succession, they should be mentored by the person they will replace prior to a public announcement. This pragmatic step will support a seamless transition.

4) Be Confident in Your Choice

Consider succession planning as you would any other kind of strategic plan. Take your time and assess your options as much as possible. Evaluate talent objectively. If the process creates internal conflict, you may need to consider hiring an objective, neutral third party to help guide the leadership team through the process. Set a high bar and communicate your expectations. Remember, this is an investment in your company’s future and a method to retain your strongest performers who often have a strong desire to know the direction of their careers.

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Include succession planning in your executive leadership strategic meetings NOW; direct the process and address the critical attributes needed for effective leadership. Without a long-term strategy, you leave yourself vulnerable. Yesterday was the perfect time to start the planning process.

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At Warren Whitney, we help develop plans for a smooth transition to the next generation, whether that’s a family member, a current employee, or someone from outside the organization. We develop succession plans that include: Current Organizational Assessment, Emergency Absence Procedures, Employee Development Plans, Communication Plans. Additionally, we provide search services to help identify candidates who are appropriate for your organization. Let our strategy team get your succession planning on the right path.

If you have any questions or seek further clarification, please contact Scott Warren at 804.282.9566 or email him at swarren@warrenwhitney.com.  We do not charge for the initial call. We want to learn more about your needs.

MAKING POTENTIAL HAPPEN