Succession Planning is Not Just Succession Planning
Succession planning is most often viewed as a process for identifying internal talent to replace top leadership positions. The focus is on creating back-up lists, mostly by executives nominating candidates from their own departments.
The problem with this approach is that the hit rate on backup lists is often very low - about 15%. Not a very effective use of time and resources. Because of this, it is better to view the process as Succession Management versus Succession Planning.
I also use a much more encompassing definition of Succession Management based upon the components required to achieve a return on the time and resources invested in the process.
Succession Management is a deliberate and systematic effort to identify leadership requirements, identify pools of high-potential candidates at all levels, accelerate the development of mission-critical leadership competencies in the candidates through intentional development, select leaders from the candidate pools for pivotal roles and then, regularly measure progress.
(Click here to read more about my definition of Succession Management)
I actually prefer the term Organization Capability Management. It helps emphasize that I am defining "leadership" and "succession" in very broad ways. Leaders are not only those at the top of org chart and not just managers of others. Leadership includes thought/knowledge leaders. Succession is not just replacing key people but identifying, reinforcing and sustaining pivotal roles and organization knowledge
Read on to learn:.
- How to build an effective Succession Management process
- 10 ways to improve your existing Succession Management process
Building an Effective Succession Management Process
Seventy-Five percent of companies in a 2011 survey on Succession Management acknowledged that they need to make their process stronger. So, if your company counts itself in the 75% and wants to improve Succession Management (SM), what do you need to do to build a robust process?
Build the Business Case. Succession management is no different from any key business process. It will more likely create value if the business case is firmly established from the start. Build a value map that shows the link from key business goals to potential SM outcomes to the components of the SM process that will create the desired outcome.
Build Leadership Commitment. Leadership commitment is a hallmark of any successful change management effort. This should be a natural outcome of the business case. The "what's in for the organization" and "what's in it for me" should be clear at this point. HR leadership plays an important role but the key is building commitment with line managers.
Build A Robust Process. The most often cited requirement for an effective SM process is a valid and reliable method of assessing talent. The best assessment practices are candid, facilitated, behavior-based team discussions that do not require preparation or paperwork and do not depend solely on a single manager's assessment. (Read more about assessing your organization's talent.)
Build A Differentiated Process. The SM process should clearly differentiate roles that are pivotal versus those that are enabling or business necessity roles. How employees with different capabilities are handled must also be differentiated. The past CEO and Chairwoman of Xerox, Anne Mulcahy, stated in a 2009 NY Times article that "Not everybody is created equal, and it's important for companies to identify those high potentials and treat them differently, accelerate their development and pay them more. That process is so incredibly important to developing first-class leadership in a company." I couldn't agree with her more.
Build Accountability and Follow Up. You have a clear business case, committed leadership and a robust process that differentiates. That will all be for naught unless talent action plans are created for which managers are held accountable. As a plus, it is very difficult to have candid talent discussions (See Building a Robust Process) and just walk away without discussing ,"OK, now what do we do?"
(Read more about Building a Robust SM Process)
10 Ways to Improve Your Succession Management Process
- Do not depend solely on talent assessments done by each employee's manager. They are notoriously unreliable and skewed
- Link the SM process to the business planning cycle. Do talent reviews at the same time that the company builds its annual business plan and budget.
- Do not use forms that managers fill out in advance. No paper is best.
- Use talent reviews with facilitated discussions focused on leadership behaviors and the impact of those behaviors.
- The process should not be seen as the sole province of HR. HR should guide the process but it should be owned by line management.
- Use a common language - preferably a validated competency model for the roles you are discussing. Do not build your own competencies from scratch. Use a system that has some research behind it.
- Review more than just the top of the house. Think about the process as assessing pools of talent throughout the organization, not just building back-ups for the executive team.
- Measure the SM process. Link the measures to key business goals.
- Track the talent data and make it accessible to leaders to use in decision making.
- Link the SM process to other talent processes. For example, the talent assessments should match the feedback that employees receive in Performance Reviews. Use the SM process to calibrate the reward system. Hire and promote on the same competencies.