Business succession planning: Here today, here tomorrow

Michael Boyd

The future of any organization depends upon the smooth transition of leadership from one generation to the next.

From the C-suite to the first-line supervisor, sooner or later, most positions will be open. Without a succession plan, organizations find themselves with vacancies at lead positions or, worse, with underqualified people filling key slots.

The best way to minimize the effect of leadership vacancies is to develop and implement a robust succession plan for all key positions.

Current trends in the U.S. economy make succession planning a top priority. Consider the following points from “Succession Planning and Management” by Theresa Howe:

• Baby boomer retirements are on the rise just at the time when the economy is growing, increasing the demand for senior-management expertise.

• There is no emerging group of potential employees on the horizon of comparable size as in the past.

• Many organizations eliminated middle-manager positions during restructuring in the 1980s and 1990s and no longer have this group as a source to fill senior level vacancies.

Successful organizations — for-profit and nonprofit — align their organizational talent needs with their business goals as defined in their strategic plans. This practice seeks to ensure consistent, strong performance.

A well-developed succession plan supports the continuity of organizational success in several aspects.

It loads the management pipeline with qualified people to fill vacancies that occur due to expansion, retirement or turnover.

It demonstrates stability and a commitment to future growth as well as opportunities for career advancement.

It shows commitment to maintaining and increasing the organization’s competitive edge in the marketplace.

Building a bench with supervisory talent includes four key elements: comprehensive technical training, administrative-task training, formal or informal mentoring, and occasional special assignments that test the individual for the next level of responsibility.

Comprehensive technical training programs identify skill gaps and prepare employees to assume more responsibility. In the short term, this type of cross-training maintains productivity when key employees take paid leave or when there is turnover. Long term, well-rounded technical training programs prepare the next generation of supervisors, ensuring that key technical knowledge is captured before the baby boomer supervisors walk out the door for the last time.

Administrative-task training is crucial to success as employees advance in their leadership roles. Tasks such as performance reviews, financial record keeping, budgeting, statement reviews and production-data input are essential to assuming positions of higher responsibility. Exposure to these tasks in a formal training program shortens the learning curve when an employee is elevated to a supervisory role.

Mentoring programs focus on developing the specific leadership characteristics needed to assume more responsibility in the organization. Mentoring is a formal or informal relationship established between an experienced, knowledgeable employee and an inexperienced or new employee. The purpose of a mentor is to help the new employee quickly absorb the organization’s cultural and social norms, thus preparing him or her for leadership.

Special assignments like covering for vacations and team projects, are opportunities for testing the potential of those candidates identified as future leaders. Successful organizations create structure around those opportunities, provide support to the individual and gather post-assignment feedback to make informed decisions.

The model for leadership succession varies from organization to organization. There is no one-size-fits-all solution. Business conditions change and some of the variables are not controllable. Proactive organizations constantly prepare for a variety of scenarios. Succession planning is one way to prepare for the uncertain future.

The best time to start succession planning was yesterday. The second-best time is today.

Michael Boyd is the program manager for Business and Workforce Development at Hagerstown Community College. He can be reached at mdboyd@hagerstowncc.edu or 240-500-2490.