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Succession Planning and Development

Succession Planning and Development

Dan McCarthy | Great Leadership

April 16, 2010

After having written my 500th post for Great Leadership, I thought it was finally time to write something on how to do succession planning. After all, it’s where I probably spend 50% of my time, and have been doing it for over 20 years at three different companies (my goal to write an e-book on the topic some day).

It’s not that I haven’t written about many of the components – and I’ll try to link to as many as I can – it’s just that I’ve never written a single “how-to” guide on the topic. In some ways it’s harder to step back and look at it at the 10,000 foot level, because I’m so close to it – like an engineer writing a 1,000 word post on how to do engineering.

I hope this hits the mark for most of my readers.

Here is a simple, practical, and effective (no b.s.) guide to succession planning & development:

Step 1: Have a damn good reason to do it.

For you PhDs out there, this step is often called “Link to business and HR strategy” or something like that. Most damn good reasons are usually pretty strategic, unless you’re doing it because the CEO, your boss, or some regulatory agency says you have to do it. Some examples of damn good reasons are:

- You’re anticipating a wave of retirements of a lot of very key talent

- You don’t have the talent to fill key positions – resulting in too many costly and risky external hires, or “over-promotions”

- You’re business is growing and/or changing, and you’re afraid you won’t have the talent needed to be successful

Identifying your damn good reasons will also help you stay focused and establish the foundation for measuring your progress. If you skip step one, beware – you’ll end up with a bureaucratic nightmare that everyone hates, and probably end up looking for something else to do to annoy people.

Step 2: Identify key positions and or “pools”.

In other words, who are you worried about finding and developing replacements for? Who would the Board of Directors, or an investor be concerned about if they left?

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In most cases, there are only a few key positions that are critical enough to bother with position-based replacement planning. Usually those are C-level positions, or perhaps some rare scientist or programmer full of intellectual property. Otherwise, it makes more sense to identify key levels or functions, and then identify “pools” (groups) of talent that could potentially step into any position at a specific level of function. For example, you might have a “senior executive” ”, or a “management” pool. Large organizations often have many pools, one for each level.

Step 3: Data gathering.

This is where the process can take on a life of its own, and where I see companies get bogged down. Here’s a simple way to look it: Say you’re doing succession planning for a big fish position for a 1,000-person company. You’ll want to somehow throw a net out there and haul in the handful of those 1,000 little fish in the ocean that have the potential to be your next big fish. This data gathering usually takes the form of talent profiles, resumes, HR data, and assessments. You could also do a little “demand forecasting”, to figure out how much talent you need for key levels or functions. Software programs can help keep track of this information, as well as monitor and track progress and results.


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