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What are you doing to cultivate leadership from within? Is succession planning a priority for you?
Fortune Magazine (May 31, 2004) published an article highlighting a company that for six years has had instability in the top post and most recently put them in greater disarray with the surprise retirement of its current CEO. The article goes on to say, not only has morale and direction suffered due to the company’s state of limbo, but their stock price plummeted.
You might be surprised to hear that the company they were referring to was not some young, inexperienced company but it was…Coca Cola—A company that has been around for 118 years! An excerpt from the article states, "…the company management is in disarray…when its CEO Douglas Daft announced retirement, the board was unprepared. It had no succession plan."
Contrast this with GE (even if you're tired of hearing about GE, it's worth noting) who had several internal candidates who had been groomed and were competing to take over the helm after Jack Welch left. Or, a client of ours, Santa Monica Big Blue Bus—lesser known, but committed to and successful at grooming and promoting from within for key positions.
Why is it that, cultivating leadership and succession planning is not a priority for many
organizations? (Please email us your thoughts at: kcatlin@insightstrategies.com).
Here is what we have seen— 1) There is no doubt tremendous pressure to hit short-term business
goals which is often at the expense of longer term goals like succession planning, 2) At upper
levels of management we see too much involvement in lower level activities and decision-making.
The Leadership Pipeline – "In some companies, at least 50% of the people in leadership
positions are operating far below their assigned layer," 3) It takes forethought, intention and
resources to make it happen, and 4) Many executives are never taught how to create a succession plan.
What needs to be in place for succession planning to occur? Meaning… for every key position in the organization there is at least one well-groomed, successor ready and waiting in the wings to perform at peak levels with a seamless transition. Here are a few things that need to be in place:
- Commitment to train, equip, and develop those down the chain (leadership based training)
- Delegation/empowerment/trust – a willingness to push responsibility (not just the grunt work) down the chain
- Formalized mentorship/apprenticeship program
- Performance accountabilities
- Frequent feedback regarding expectations and performance
- Succession plan integrated into the business/strategic plan
- Not being threatened by the "up and comers"
Let’s face it – many of us who have been in the workplace for 15 plus years have a fear of becoming extinct, outplaced, replaced by some young hotshot with more high-tech skills in their fingernail then some of us will ever have in our lifetime. One upside to the bubble bursting…it humbled the younger sect and Corporate America was reminded that strong leadership is not only essential but is typically held by the more experienced (albeit often less technical) sect.
What are the downsides if we don’t cultivate leaders from within? Start by asking yourself these questions, "If I got run over tomorrow, who would replace me? And, what impact would it have?" These are critical questions that all organizations need to be asking themselves for every key position in the company.
Not only will the organization benefit from the standpoint of stability, morale, motivation, direction and undoubtedly financial success, but your employees will benefit also. Your top performers will especially be inspired and challenged to do what it takes to compete for those key positions. Workers of today rank a company’s commitment to training and development as top criteria for choosing to stay or go.
As a side note…Succession planning is the second most talked about topic in boardrooms today. The #1 topic discussed is…the effectiveness of the current CEO.
Suggested action:
At your next staff meeting, rate your organization’s performance in the following -
areas on a scale of 1 to 5:
Commitment to train, equip, and develop those down the chain (leadership based training)
Delegation/empowerment/trust – a willingness to push responsibility (not just the grunt work) down the chain
Formalized mentorship/apprenticeship program
Performance accountabilities
Frequent feedback regarding expectations and performance
Succession plan integrated into the business/strategic plan
Not being threatened by the "up and comers"
"Drive the business or it will drive thee."__ Benjamin Franklin
The ISI Coaching Team!
© Insight Strategies, Inc. 2004
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