5 Hot Tips for Succession Planning

5 Hot Tips for Succession Planning

This article was published in the March, 2014 issue of Professional Safety magazine, at their request.

Here is the pdf for you to share with others: SuccessionPlanning_PS_3.2014

Here is the article:

At a recent ASSE meeting I asked, “What is your leadership succession plan?”

After a blank stare from several members I heard:
“We don’t have one. What is it, exactly?”
“You’re looking at it. I’m all we’ve got.”

Safety professionals are not alone. Let me explain what succession planning is, and provide the 5 steps you need to develop a succession planning process.

Definition
Succession Planning can be defined as a process for identifying and developing key leaders within your company. The primary purpose is to increase engagement and retention by providing a career ladder. Some people talk about “bench strength” as if it is a number- how many people do we need to replace the “first string” or senior team in the “hit by a truck and all down scenario?” (Sorry for such a morbid view for safety leaders.) Another purpose of succession planning is to create a talent development culture that affirms individual strengths and develops competencies that drive results. For instance, if you need more safety leaders with business development expertise to review proposals, then you would consider including the safety leaders on sales calls. Over time you would promote the best safety leaders who also generate new business.

Trends
By 2020 some 25% of the workforce will be baby boomers, over age 65, called the “silver tsunami.” These boomers may not be able to afford to retire. Sadly, the average retiree in the U.S. has a median household net worth of less than $190,000. And men will live to 86 years of age. Your senior leaders may be forced to continue working. Your younger safety leaders may become so discouraged that they take other positions in related fields in order to make more money or develop their careers. Look closer to home for trend patterns: There is a dearth of ASSE members in that 25-50 age cohort. Some job sites look more like country clubs- dominated by silver-haired veterans and young workers. Too many companies lack mentoring or coaching programs. My conclusion: there is a tremendous need for simple, effective succession planning processes.

How to create a succession planning process?
Imagine a wheel with 5 spokes, or a calendar item that tickles you every 5th month, or assigning these 5 steps to 5 different people. These are the 5 steps in an ongoing succession planning process:
1. Identify key roles (such as managers and above) that may require replacement in the next 3 years. List each role and each person.
2. For each role, list the job competencies and personalities that are a) required and 2) recommended. Keep it simple. Lean on your HR colleagues. Solicit updates from those in the role. We know that the best workers compensation people, for instance, have a high attention to detail. If uncertain, or if you desire confidential expertise, hire an external vendor like us.
3. Assess your current people based on their a) status now (e.g.: ready now, development needs defined, development needs to be defined) and b) potential (e.g.: skills, ability, longevity, health, etc.) Then list concerns for each person such as job performance, health risks, medical needs, family concerns, job potential, or ability to travel. Create a database or flow chart.
4. Identify a pool of potential talent. Great people are everywhere. “Talent scarcity” is a myth perpetuated by managers who choose not to invest in their people. Your primary talent pool is internal; your secondary talent pool is external. Please hire internally. Internal promotions lead to higher levels of retention and engagement at lower cost. External hires typically cost more and drive conflict (which can be a necessary motivator at any company.)
5. Use progressions of experiences to actively develop key people so that they can be “ready now” for advancement. Succession planning is not a checklist or software package. It is a series of meaningful experiences. For instance, action learning teams of cross functional managers may be selected to develop a breakthrough product. High potential managers may be tasked with a business development opportunity or leadership training experience. Senior leaders can be partnered with 3-4 “hi pos” for quarterly mentoring sessions. Note that none of these experiences is expensive. For expertise contact any external vendor with experience in succession planning and leadership development experiences. Avoid wasting money on events.

Review your metrics
You all know the value of “What gets measured leads to results” attributed to Peter Drucker. You need to know the corollary, “What gets rewarded gets repeated.” There are two parts to that maxim. If your reward compensation is not tied to succession planning, then you are wasting your time and resources. As a graphic example, one CSP recently told me about a company where they were tasked with setting up goals on an annual performance review sheet. But they did not need to ever attain those goals. If they completed the sheet they were rated “satisfactory.” They were measuring the wrong metrics. Good people left. They wasted time, money and careers.
A better metric for effective succession development is the % of vacancies that are actually filled with internal promotion vs. external hire. Your job as a leader is to encourage people to stay in your company. They must believe in your “leadership pipeline” or “career development ladder.” Pick your metaphor. In fact, at some publicly traded companies, if 45% of the promotions are external hires then it begs questions about the quality of the senior leadership team and the board. You should be developing people, not hiring externally.

The bottom line? You only have 3 options for succession planning:
1. develop succession planning internally
2. develop succession planning externally
3. ignore the inevitability with a “wait and see” approach

In reality, you only have 2 choices if you have 20+ employees. See options 1 or 2 above.

A coaching question to leave you with is: How are you identifying and developing your best people?

Bio: Doug Gray, PCC, is a leadership coach who helps safety leaders develop and retain their leaders. Reach him at 704.895.6479 or www.action-learning.com

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