October 25, 2016 • Beth Williams
4 Succession Planning Strategies to Ready Your Business for Tomorrow
Modern businesses have two sources of irreplaceable knowledge that, if lost, would leave a crater-sized hole in their operations. One is their databases, which if damaged can decimate years of insight in an instant. The other is their people, which, if lost before their transfer of knowledge, can force companies to relearn hard lessons. Most companies recognize the need to implement data backups in their business continuity, but far fewer feel that succession planning strategies are an immediate concern.
Talent can disappear faster than imaginable. Retirement, health concerns, personal issues, and employment offers can all cause the sort of brain drain that slows operations. Successful succession plans don’t wait for obvious signs a transition will happen. They ensure knowledge is shared from person to person long before any departure is ever a threat.
To be proactive rather than reactive, forward-thinking companies try to put the following succession planning strategies into motion.
1.) Overcome Excuses
One of the largest obstacles to succession planning is the program launch. Often, the whole process is misperceived as retirement planning, an ostensibly far off event that makes procrastination an easy choice. Yet even if employee retention is high enough that retirement is the only way talent leaves, the transfer of years of knowledge is still crammed into a few scant months.
Good succession planning is never reactionary. Internal knowledge is spread long before a replacement needs to be made. Much of the trick is taking the plunge and seeing succession planning as just another way employees learn on the job.
2.) Identify Future Leaders Early
Proper succession planning takes time. For key processes, tactics, technical competencies, and collaborative methods to be sustained, replacements need to be available at the right place at the right time. Since the average employee tenure at a given organization is 4.6 years, its best to identify several future leaders early to mitigate the natural effects of attrition.
When looking for leaders, technical aptitude alone is not the kingmaker. Each level of seniority (CEO, CFO, Regional Managers, etc.) will have its own criteria, but there are a range of traits that all leaders need to exude. The answers to each of the questions below can help determine whether a candidate should be included in the line of succession:
- How well does a candidate align with the future vision of the company?
- Are candidates 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?
- Do they have a strategic or analytical approach to problems?
- Are they a good cultural fit? Are they likely to remain part of the company?
- Are they focused on the future? Will they be instrumental in ongoing succession planning?
Remember, the candidates do not need to be of the “ready now” variety. Good succession planning isn’t going to be tapping their potential until a while down the road, so if there’s room for them to grow into a position, it’s important to see that value and foster it as you train and test them to be future leaders.
3.) Run Test Scenarios to Measure Readiness
What good is a leader untested? When tapping internal talent as part of succession planning, successful businesses evaluate a candidate’s innate skills. Which aptitudes are already strong? Which aptitudes need refinement? The types of positions and projects they are tasked with should maintain old talents while fostering new ones.
Google is a great example of this succession planning tactic getting results. Current CEO Sundar Pichai has been given incrementally evolving challenges within the Google family for years. His potential was spotted as he made Chrome into a widely popular web browser. New challenges were presented to him, each resulting in phenomenal products and output. Eventually, Larry Page selected him to become the next CEO of Google. That was after they gave Pichai the opportunity to step into a larger capacity overseeing product and engineering responsibilities.
Larry Page made a point of mentoring Pichai in the months preceding his announcement and the months until the official hand off. Page has been described as having the “blue sky vision” while Sundar as having a more practical day to day approach. The consultation that Page provided in the interim years helped Pichai test out more innovative roles with the guidance of one of the best “moonshot” thinkers around.
Companies that can follow this model in their succession planning strategies will experience greater luck in the long run. The path that Google took refortified areas where Pichai was already strong (deliverability, operations, etc.) and provided him with guided opportunities to review and experiment with the more innovative aspects of the emerging Alphabet vision.
4.) Convey Confidence in Your Choice
Once the succession plan is in motion, one of the worst things a company can do is to undercut their intended successors. How does that happen? Failure to communicate confidence, idle consideration of external candidates, or even restriction of a candidate’s efficacy can wither the figurative fruit on the vine.
Take the Walt Disney Company as a cautionary example. Originally, they had intended exiting COO Thomas Staggs to inherit the position of CEO Bob Iger once the formative leader left. But some internal conflict led Staggs to step down from his position. It’s unknown where Staggs will take his career, but Walt Disney will not be reaping the rewards of the time and talent they invested in him.
There has been speculation about what happened behind the scenes at Disney but the most important lesson to take is that successful succession plans put faith in the people involved – especially if those leaders continue to deliver strong results. Getting cold feet just shy of the end goal is very bad for business.
How to Fuel Your Succession Planning Strategies
One final key to ensuring that succession planning goes the way it is intended is to find effective, culturally compatible leaders in the first place. To improve your odds of quickly finding future leaders and keeping confidence in that candidate requires a careful search for the right people.
At SMART Resources, our years of experience as an IT staffing and consulting firm have helped us to find great people who can create innovative solutions using great technology. We find our clients technical talent that will be able to overcome challenges and become leaders in their businesses. With your technical team in place, let our strategy team get your plan for succession on the right path.
For additional information that can propel your business forward, download Your Start-to-Finish Guide to Implementing Vital Business Intelligence Strategies today.