0
Win the war for talent through
best-in-class succession planning
David Edwards, Head of Professional Services, CEB
7 Octob...
•

The Succession Landscape

•

Reducing your succession risk - 4 key steps to success

•

Questions and answers

2

© 201...
Changing landscape of succession
•

Changing requirements of leaders

•

Corporate governance

•

Focus on specialists and...
Talent Management and Succession Planning
Talent Management

Succession Planning

Starts with people

Starts with jobs

Th...
Challenges we hear
“We don’t know if we are bringing the
right people into our talent pools.”

“We are concerned about the...
4 key steps to success in succession

Step1
•Know your
critical roles
•Understand what
it takes to be
successful

Step 2

...
Step 1 – Know your critical roles

7

© 2013 The Corporate Executive Board Company. All rights reserved.
Case story: ZHC
•

Family owned business – second generation of 12 brothers run Zamil Holding
Company (ZHC)

•

About 40 c...
Client goals
•

Clear understanding of the future leadership requirements to deliver the Zamil strategy

•

A robust and o...
Zamil Leadership Talent Matrix

What

Potential

How

10

© 2013 The Corporate Executive Board Company. All rights reserve...
Step 2 – Identify future potential

11

© 2013 The Corporate Executive Board Company. All rights reserved.
HIPOs contribute significantly to leadership pipeline
HIPOs are more valuable and contribute
disproportionately to the org...
Inadequate measures of potential
Most HIPO identification systems fall short
These strategies increase risk
of selecting c...
SHL Model of High Potential
Assessment Methodology

Intellectual
Agility

The indices are assessed online
utilising a comb...
Step 3 – Accelerate high potential

15

© 2013 The Corporate Executive Board Company. All rights reserved.
Are you maximising High Potential?
Have you identified High Potentials or
created Talent Pools?
Do you know what they have...
Mismanagement of HIPOs is costly
• Employee performance is 14% better in organisations that invest in HIPO programmes
• HI...
HIPO programmes deliver worrying low ROI
HIPO programmes target future leaders, yet
struggle to do so effectively
The top ...
Validating and accelerating HIPOs @ EDF Energy
Context & Objectives
•
•
•
•

Quantify and validate the capacity and capabi...
Individual profiles and group benchmarking

20

© 2013 The Corporate Executive Board Company. All rights reserved.
Step 4 – Assess for readiness

21

© 2013 The Corporate Executive Board Company. All rights reserved.
Effective leadership transitions affects revenue and profit
High performing transitioning leaders
reach full productivity ...
Difficult transitions have wide reaching impact
A significant percentage of transitioning
leaders underperform

Underperfo...
Assessing readiness at The Coca-Cola Company
•

Marketing talent is critical to the success of The Coca-Cola Company

•

I...
The succession challenge
•

Pipeline challenges

•

Employees not completely engaged

•

Organisational feedback

25

© 20...
The goal
•

The Coca-Cola Company’s goal was to
complement their People Development Forums
with objective and relevant dat...
Assessing for readiness: A comprehensive approach
Knowledge –
organisational and
market know how
Behaviour – leading
and d...
The results
In Year One alone

By 2012

• 93% of senior marketing roles filled
internally

•

Nearly 100% of critical mark...
Thank you
David Edwards
Head of Professional Services, CEB
David.edwards@shl.com
Come and see us on stand B30

© 2013 The ...
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Win The War For Talent Through Best-In-Class Succession Planning, David Edwards

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Past experience shows that poorly executed succession plans can have an immediate negative impact on company momentum, reputation, employee morale and the bottom line. Any business or public sector organisation, irrespective of its size, should have a strategy to deal with losing talent, whether it’s planned or unplanned. This strategy should not simply be focused on the C-suite, but applied to every level of an organisation. Find out how companies are building effective succession planning with long-term successors as well as short-term replacements in order to maximise business performance and continuity.

This presentation was used at HR Summit and Expo 2013 www.hrsummitexpo.com

Published in: Business, Technology
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Transcript of "Win The War For Talent Through Best-In-Class Succession Planning, David Edwards"

  1. 1. Win the war for talent through best-in-class succession planning David Edwards, Head of Professional Services, CEB 7 October 2013 © 2013 The Corporate Executive Board Company. All rights reserved.
  2. 2. • The Succession Landscape • Reducing your succession risk - 4 key steps to success • Questions and answers 2 © 2013 The Corporate Executive Board Company. All rights reserved.
  3. 3. Changing landscape of succession • Changing requirements of leaders • Corporate governance • Focus on specialists and experts • Critical roles • Risk and cost of external hiring • Shortage of available talent 3 © 2013 The Corporate Executive Board Company. All rights reserved.
  4. 4. Talent Management and Succession Planning Talent Management Succession Planning Starts with people Starts with jobs The agility to match key talent with strategic opportunities is critical to outperforming in today’s dynamic and hypercompetitive global marketplace. 4 © 2013 The Corporate Executive Board Company. All rights reserved.
  5. 5. Challenges we hear “We don’t know if we are bringing the right people into our talent pools.” “We are concerned about the strength of our leadership pipeline.” Only 1/15 Only have the potential to be effective leaders in the near term 29% of high performers currently have the potential to rise and succeed in more senior critical positions Source: CLC Realising the full potential of rising talent 2005 Source: The SHL Talent Report 2012 “Our HIPO programmes are not delivering a return for the business. ” “The failure rate of transitioning leaders is high.” Nearly 46% 40% of all transitioning leaders underperform of internal job moves made by people identified as “high potentials” end in failure Source: CLC HIPO Program Operations and Outcomes Survey, 2012 Source: CLC High Impact leadership Transitions, 2012 5 © 2013 The Corporate Executive Board Company. All rights reserved.
  6. 6. 4 key steps to success in succession Step1 •Know your critical roles •Understand what it takes to be successful Step 2 Step 3 Step 4 •Identify future potential •Build talent pools •Be clear about what potential means •Nurture, motivate and develop your hi potentials 6 •Assess for readiness •Give new leaders the best possible chance of success © 2013 The Corporate Executive Board Company. All rights reserved.
  7. 7. Step 1 – Know your critical roles 7 © 2013 The Corporate Executive Board Company. All rights reserved.
  8. 8. Case story: ZHC • Family owned business – second generation of 12 brothers run Zamil Holding Company (ZHC) • About 40 companies in the group: • Steel • Air conditioning • Glass • Want to become more global in outlook, leveraging their brand and financial strength • Also want to ensure that 3G family members assigned appropriate roles in the business • Talent management at the top of the agenda, both for 3G and also for professional staff 8 © 2013 The Corporate Executive Board Company. All rights reserved.
  9. 9. Client goals • Clear understanding of the future leadership requirements to deliver the Zamil strategy • A robust and objective assessment regime to measure leadership capability and potential amongst the 3G family members • Individual and organisational data for all participants, including clear development plans 9 © 2013 The Corporate Executive Board Company. All rights reserved.
  10. 10. Zamil Leadership Talent Matrix What Potential How 10 © 2013 The Corporate Executive Board Company. All rights reserved.
  11. 11. Step 2 – Identify future potential 11 © 2013 The Corporate Executive Board Company. All rights reserved.
  12. 12. HIPOs contribute significantly to leadership pipeline HIPOs are more valuable and contribute disproportionately to the organisation’s future leadership pipeline Non HIPOs HIPOs HIPOs are 91% more valuable to the organisation than Non-HIPOS and three times more likely to succeed at the next level than High Performers High Performers 1.9 x HIPOs 75% 1.0 x 25% Source: CLC Human Resources High-Potential Employee Management Survey; CLC Human Resources Head of HR Function Survey. Probability of Success at the Next level Value to organisation High-Potential talent Management a top strategic concern for CEOs and Heads of HR High-Potential Management Is Not a Top Priority for the CEO but it Is a Top Priority for HR 19% 6% For 75% of organisations, HIPO management is a top priority for both the CEO and HR High-Potential Management Is Not a Top Priority for Either the CEO or HR 75% High-Potential Management Is a Top Priority for Both the CEO and HR Source: CLC Human Resources Realising The full potential of rising talent 2005 12 © 2013 The Corporate Executive Board Company. All rights reserved.
  13. 13. Inadequate measures of potential Most HIPO identification systems fall short These strategies increase risk of selecting candidates that may be performing well in their current roles, but are not truly high-potential. High Performance: Necessary, but not sufficient on its own. Tenure & Experience: Relying on these indicators alone would yield an accuracy rate of less than 9% Leadership competencies Success rates are far from ideal when using leadership competencies alone Source: CLC Human Resources Realising The full potential of rising talent , 2005 Most high performers are not high potential The remaining 71% are missing something needed to excel at the next level of the organisation Only 29% of high performers are also high potential employees 13 © 2013 The Corporate Executive Board Company. All rights reserved.
  14. 14. SHL Model of High Potential Assessment Methodology Intellectual Agility The indices are assessed online utilising a combination of Personality, Motivation and Cognitive Ability Tests (approx. 2 hours) Aspiration Motivation Individuals demonstrating these 3 key indices are 3 times more likely to reach a senior executive position. 14 © 2013 The Corporate Executive Board Company. All rights reserved.
  15. 15. Step 3 – Accelerate high potential 15 © 2013 The Corporate Executive Board Company. All rights reserved.
  16. 16. Are you maximising High Potential? Have you identified High Potentials or created Talent Pools? Do you know what they have the potential for? Are your HIPOs engaged and motivated to deliver business results? Do you know what support and development they need? Have you set them up for success? 16 © 2013 The Corporate Executive Board Company. All rights reserved.
  17. 17. Mismanagement of HIPOs is costly • Employee performance is 14% better in organisations that invest in HIPO programmes • HIPOs in such organisations are 69% more likely to succeed in more senior roles • Organisations can maximise High Potential by: • Leveraging employee relationships – ensuring HIPOs are surrounded by quality people (colleagues and their manager) • Showing genuine organisational commitment to the individual by understanding their motivation and aspirations • Structuring challenges within job experiences and designing a meaningful and achievable personal development plan Identifying HIPOs does not guarantee business results. HIPOs need to be individually understood and nurtured to ensure they fulfil potential. CLC – ‘Realising the Full Potential of Rising Talent’, CEB Research, 2005 17 © 2013 The Corporate Executive Board Company. All rights reserved.
  18. 18. HIPO programmes deliver worrying low ROI HIPO programmes target future leaders, yet struggle to do so effectively The top objective of most HIPO programmes (81%) is to build a pipeline for succession management 36% Effective Ineffective 64% But few HIPO programmes deliver expected talent outcomes Only 36% of HIPO programmes are effective at building a pipeline succession management Refers to percentage of respondents who choose Very Effective or Effective on a 7 point scale Source: HIPO Program Operations and Outcomes Survey 2012 With dangerous consequences Nearly 40% of internal job moves made by people identified as “high potentials” end in failure. 40% Failure Success 60% Source: CLC HIPO Program Operations and Outcomes Survey, 2012 Percentage of internal job moves made by High Potentials that end in failure. 18 © 2013 The Corporate Executive Board Company. All rights reserved.
  19. 19. Validating and accelerating HIPOs @ EDF Energy Context & Objectives • • • • Quantify and validate the capacity and capability of the leadership talent pool Build sustainable development plans and set stretch expectations Engage the executive Benchmark leadership talent Programme Overview Briefing with Talent and HRBPs Identification Stretching “day in the life” simulation Online diagnostics In-depth career achievement and aspiration interview Career profile review Personal report 3-way Feedback & Development Planning Development 19 Talent Review Individual Profiles Predictive Talent Analytics © 2013 The Corporate Executive Board Company. All rights reserved.
  20. 20. Individual profiles and group benchmarking 20 © 2013 The Corporate Executive Board Company. All rights reserved.
  21. 21. Step 4 – Assess for readiness 21 © 2013 The Corporate Executive Board Company. All rights reserved.
  22. 22. Effective leadership transitions affects revenue and profit High performing transitioning leaders reach full productivity nine months before their average peers These factors combine to generate potential improvements in revenue of 3% to 5% and profit of 2% to 5% Attrition risk for their teams is 13% lower than average, and their teams show discretionary effort levels that are 2% higher than average Source: High-Impact Leadership Transitions: A Transformative Approach 26 October 2012 But few organisations prepared for leadership vacancies 13% Less than 15% of business leaders’ direct reports are ready for immediate transition into the next role 71% 16% Ready now Ready in more than 1-12 months Ready in more that 12 months Nearly one third will not be ready within next two years Succession Readiness Among Leaders’ Direct Reports (percentage of potential successors) Source: CLC, Improving Business Leaders Effectiveness Survey 2008 22 © 2013 The Corporate Executive Board Company. All rights reserved.
  23. 23. Difficult transitions have wide reaching impact A significant percentage of transitioning leaders underperform Underperformance proves more likely (and troubling) than derailment. 51.4% Only one-half of transitioning leaders perform solidly during the course of their transitions 100% 46.3% 2.5% Source: High-Impact Leadership Transitions: A Transformative Approach 26 October 2012 Total population of transitioning leaders Solid Performers Under Performers At Risk of Derailment Ineffective transitions cause a ripple effect Direct reports of a struggling transition leader perform, on average, 15% worse and are 20% more likely to leave the organisation or be disengaged, than those who report to a high performing one Source: High-Impact Leadership Transitions: A Transformative Approach 26 October 2012 23 © 2013 The Corporate Executive Board Company. All rights reserved.
  24. 24. Assessing readiness at The Coca-Cola Company • Marketing talent is critical to the success of The Coca-Cola Company • Inability to fill a critical marketing leadership role from within raised serious questions about the marketing leadership pipeline • Having to look outside to fill vacancies was: • Expensive • Risky • Demotivating for top talent 24 © 2013 The Corporate Executive Board Company. All rights reserved.
  25. 25. The succession challenge • Pipeline challenges • Employees not completely engaged • Organisational feedback 25 © 2013 The Corporate Executive Board Company. All rights reserved.
  26. 26. The goal • The Coca-Cola Company’s goal was to complement their People Development Forums with objective and relevant data that enriches understanding of the potential and readiness of their talent in global marketing • Who has the potential to make the transition? • What do they need to make them ready to make the transition? 26 © 2013 The Corporate Executive Board Company. All rights reserved.
  27. 27. Assessing for readiness: A comprehensive approach Knowledge – organisational and market know how Behaviour – leading and developing the business, inspiring others to deliver Experience – leading teams, managing in a downturn, managing a P&L Qualities – drive, resilience, learning orientation 27 © 2013 The Corporate Executive Board Company. All rights reserved.
  28. 28. The results In Year One alone By 2012 • 93% of senior marketing roles filled internally • Nearly 100% of critical marketing leadership roles filled internally • 71% of participants promoted or taken on significantly expanded job responsibilities • Programme extended to 3 levels of marketing leadership and customer and commercial leadership • Many moves have been across geographies • Ownership and commitment from senior leadership • Reduced regrettable turnover ”Now we can make sure that the right people with the right skills and behaviours are in the right place at the right time.” 28 © 2013 The Corporate Executive Board Company. All rights reserved.
  29. 29. Thank you David Edwards Head of Professional Services, CEB David.edwards@shl.com Come and see us on stand B30 © 2013 The Corporate Executive Board Company. All rights reserved.
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