Succession Planning - Investing In Leadership Continuity And Future Performance

Succession Planning
Investing in Leadership Continuity and Future Performance

Concerning Leadership Transition Statistics
46% of executive departures are unplanned
50% of baby-booming senior managers will reach retirement age in the next five years
51% of companies do not have a succession plan in place
Only 6% of companies have a system in place to build “top-flight” executive teams

Why Succession Planning Matters
Management succession is one of the most critical strategic risks a corporation faces
Failing in leadership transition can be deadly to even the most successful of businesses
The faulty integration of a senior executive can cost a company 10 to 20 times the executive’s salary in opportunity costs
64% of new executives hired from the outside fail; 40% do so within the first 18 months

Effective Succession Planning
Assures that leadership continuity plans are in place for all key positions in an organization…
… thereby providing for managed change in organizational leadership
Allows executive leadership to take a discerning look at leadership requirements and capabilities, both now and into the future…
… and build plans of transition, career development and fill gaps of consequence

Critical Deliverables
Creates a roadmap for executive succession and leadership continuity
Guides development activities of key executives
Serves to anticipate and manage issues of responsibility readiness/career ambition
Avoids transition problems and premature promotions
Provides the pipeline of leadership capability necessary to deliver strategy

Key Components
Key position requirements, now and into the future (2 – 5 years out), taking account of likely organizational architecture shifts
Potential successors (or the lack of) to each key executive position, together with development needs, gap assessments and timelines
Next move readiness assessments so that opportunities can be identified or departures anticipated
Actionable plans to prepare current leaders and high potentials for continuing performance improvement, capability development and future career opportunity

Actionable Insights
Succession matches. Situations where the timing of a leaders’ readiness for new responsibilities coincide with the timing of a successor’s readiness.
Incumbent restrained. Situations where a leader is ready for new responsibilities, but no successor is as yet identified.
Succession mismatches. Situations where a leader is ready for new responsibilities, but no successor is ready.
Blocked potential. Situations where a leader is ready for new responsibilities, but the incumbent in the next-level position is not ready/likely to move on for 2 – 3 years or longer.
Valued leader at risk. Situations where more than one successor is identified. The unsuccessful candidate will be at risk of leaving unless alternatives are found.
Organization at risk. Situations where no successor is present and corrective action is either a priority or simply judicious.

Tangible Results
Puts in place strategies and plans for leadership continuity and succession
Defines and personalizes leadership developmental priorities and investment
Motivates leadership performance and retention