Over the past few months, almost every business in the world has had to adjust their strategy and way of working to address the significant challenges presented by the current global pandemic. It’s been wonderful to see the personal and professional resilience that people and organisations have shown and the result is that most have now settled into the ‘new normal’ and it’s business as usual.
But before we get too comfortable and start patting ourselves on the back, it’s important to remember that the true impact of this pandemic is probably yet to be felt. The lockdown has given everyone a lot of time – time to think, time to plan, time to weigh up what is truly important to them and the result of this time is very likely to be attrition.
As anyone in recruitment will tell you, attrition is not always a bad thing but I do wonder how many organisations are already thinking about succession planning? My guess is not many.
In my opinion, one of the most important actions an organisation can take right now is to plan for succession below CEO level because failing to do so can hit firms financially and/or result in bad reactive hires being made. HR and Executive members have an obligation to ensure that their businesses can continue to operate effectively and face the challenge of new competition in an evolving market.
So… how do businesses create a well thought out succession process and limit exposure to unnecessary risk?
By focussing your efforts both internally and externally, you have the opportunity to bring diversity and fresh thinking into the business, to gain valuable insight into competitor talent maps and organisational structures, to potentially identify new ideas, new revenue streams and new innovative leaders.
Having invested in a succession plan recently, one of our clients fed back that they finally felt in control of their hiring. They knew that no matter who left, for whatever reason, there was a contingency plan in place, and this made them feel empowered.
Our succession planning process also highlighted two external individuals who filled ‘missing pieces’ in their teams that they hadn’t realise were missing until we presented these candidates as part of the external market map – one in leadership, the other a revenue generator.
An external succession plan needs to be so much more than just a list of potential candidates, it needs to be an educated assessment of what talent is ACTUALLY available. Are these people open to moving, what skills and knowledge do they bring, how will they fit into your organisation, who will lead them best, who will they lead best…
External Succession Planning
An external succession plan should on all aspects mirror internal planning:
- Avoid the temptation to use lockdown as a ‘comfort zone’ or an excuse to procrastinate. Skills shortages occur at all levels which can be mitigated with careful planning.
- Assess potential candidates on a cross-organisational basis and in particular as replacements for business leaders below board level.
- Consider how a succession planning team can better avoid blind spots and biases – unconscious or otherwise – when assessing external talent.
- Set clear objectives that link to the business strategy and the company’s ESG targets. What part can external succession planning play in increasing diversity, innovation and resilience?
- Use external succession planning and talent mapping to identify opportunities to upskill teams and support their development by bringing new skills and experience. Often this means tracking the ‘understudies’ who may be ready to step up if given the opportunity.
- Evolve external succession planning into a continuous process to develop a true external talent pipeline that will be ready as your business evolves and your needs change. The priorities and career goals of potential candidates working for competitor firms will change, as they do with your own employees. Are there systems in place to track key contacts who may be looking for a new challenge – or the same challenge with a different work environment? What are the factors that motivate employees at different life or career stages?
- Assess your employer brand and how you will communicate culture and values to candidates. The underlying factors driving employees to move also affects the perceptions of the external talent pool. An example of this is the trend we are seeing of people getting ready to move for a position with greater social or environmental impact. If people are leaving your business because of these factors, you will need to assess how you will attract employees to your business who are likely to have very similar concerns.
- Working from home is already leading many organisations to review their employment criteria including policies, procedures and benefits. Lockdown is changing how people want to work. How does your business appeal to external talent in terms of the practicalities of how they may want to work? To what extent are factors such as remuneration unconsciously blocking diverse talent, or those in different life stages? Do you need to stress test your hiring protocols, and can these be adapted to facilitate more rapid action?
- Your leavers are also a part of your talent pool. Create opportunities for leavers to provide insight that can lead to operational improvements and identify areas where competitors may have a stronger story. There is such a thing as boomerang employees because sometimes the grass really is greener.
There’s a lot to digest there, I know. But succession planning is a topic I truly feel should be on the forefront of every organisation’s agenda and it has to go deeper than board level positions if businesses are to execute strategy and meet their objectives. We are already hearing from our network that significant levels of attrition are likely as employees emerge from lockdown. Companies that build a robust succession plan now will reap the benefits and ensure the financial performance, business and brand is best placed in the future.
Don’t be the business that leaves it too late.
For more information on how Falcon Brook can assist you and your business with building a successful internal and external succession plan, please get in touch for a confidential conversation. We are here to help.
Psychology plays a significant part in the success or otherwise of this process – both in creating an available talent pipeline and for those within the organisation.
Neuroconomy’s economist and neuroscientist, Louise Pollock says,
“The culture and dynamism of a business or team are created jointly by individual members. This means succession planning is as much about the whole team as it is about a single individual.
Changing any one individual will have a knock-on effect on the whole team. Hiring from outside can bring divergent views and working practices. Promoting from inside changes hierarchies and can affect working relationships. Additionally, the circumstances surrounding a team member’s departure can also affect the web of loyalties, working patterns and unspoken team norms. These aspects of human relationships are often not fully taken into account in the succession planning process.
In any process, external or internal, it is important to ensure there is a plan for integrating the new leader into their team and for encouraging the formation of new, accepted team values and norms.”