In the first of two articles, Target Leadership Consulting Managing Partner Paul Surridge talks about FIVE key things to consider before embarking on your executive succession planning process. Here are his thoughts on what should be a standing board agenda item…
You may well have read about some of the pitfalls and challenges of successful succession planning, with the high profile case at Starbucks where Laxman Narasimhan coming in as ‘chief executive in waiting’ to take over from founder and legendary business icon, Howard Shultz in 2023. Perhaps not the template you’d want to follow for a smooth transition given the many bumps along the way!
Let me first start by saying that succession comes in two forms. First, you have long term succession, as in the example above, which is for critical positions in an organisation such as your next CEO appointment which you might want to make in the next three to five years. The thinking here is not about what the role entails today but how it will change in the future. This is determined by your organisational strategy.
But what do you do when someone unexpectedly leaves? Who will carry out that role in the interim now until you have a long term plan and person in place? That’s the short term aspect. It’s worth noting that the person covering temporarily isn’t necessarily moving up. Roles evolve over time and the incumbent leaving may have assumed broader responsibilities.
So, how can you maximise the effectiveness of any succession plan? Here are my top tips:
1) Understand future organisational needs
This will typically include the competencies required to deliver against that strategy, how your target operating model will change and how that will affect the senior leaders, their roles and the way they work. In a nutshell, the roles that exist today will look different tomorrow. Some of the roles might not even exist in three years’ time, so you won’t need a successor if your operating model changes.
2) Clearly define the role(s) and scope
You have to meticulously map out and define the roles and responsibilities that you want your eventual successors to fill. All the work to ascertain the type of organisation, structure, roles and people requirements needs to be done first! In other words, what are the critical roles that are fundamental in shaping and driving your future strategy?
3) Don’t confuse performance with potential
Succession is not limited to identifying individuals. Once you’ve mapped out the design changes, the journey then begins to discover who, out of the people in the running, you believe to be your successors – not just for the roles in question, but those individuals who can adapt to the future structure. Just because someone is performing well in their current role, does not mean they will be able to step up into a broader, more complex role and achieve the same level of success, especially in more senior roles. Performance is not the same as potential.
4) Identify AND develop your successors
Once you’ve earmarked the people in question, the next crucial aspect is how to provide them with the right development. By the way, senior leaders brought into the process to oversee the succession for their roles must be supported too. By delegating more and giving others greater exposure, will not only strengthen their teams but free them up to focus on other areas, developing their skills and knowledge. Succession planning informs the development part of the wider talent management process, which must always be aligned to the overall business strategy.
This is particularly pertinent given that one of the biggest challenges is that people don’t like to think about their own tenure and that they might be replaced in the future. Therefore, they may feel vulnerable and threatened. It can be a tough conversation for some.
5) Build momentum
Succession planning should never be a static process. It drives strategic decisions and the development of individuals, whether that be in the form of a secondment to another area of the business, being given additional responsibilities or different levels of exposure to gain that experience. The word ‘planning’ doesn’t cut it in my opinion. It’s really succession development, equipping people with the experiential learning needed to boost leadership capabilities.
These are some of the key areas you ought to consider before embarking on your executive succession planning process. In my next post, I’ll be looking at the FIVE key criteria in assessing and unearthing who those successors will be. And that’s where robust, data-driven objective insights come into play to help you make those informed critical decisions. More on this next time.
If you have any questions about any of the points above or if you’d like to discuss your executive succession planning requirements in more detail, Paul can be reached on 07587 003 990 or email paul.surridge@targetleadership.co.uk.