Succession Planning

Consider the following Case Studies:

In a large financial services office, all work on a key project stopped when the top decision-maker was absent for reasons she had not anticipated - a death in her immediate family. She had not appointed or trained anyone to make decisions in her stead.

People at the head of a small manufacturing company failed to anticipate the sudden, prolonged absence of the CEO due to illness. No one knew where he kept key data and information. Even the password to his computer was locked away for a time, putting the brakes on all business. After work slowly started up again, employees continued to operate in crisis mode for a lengthy period of time. The result was low production, high turnover and a serious threat to profits and survival.

Both situations could have been easily handled if the CEO or owner of the business had planned for a successor. In the best-run companies, planning for a future without the current CEO often begins years before the top decision-maker's retirement. Some experts say planning 15 years in advance is not too soon.

Succession planning does not have to be intimidating, but it must be intentional. This means every company, agency or institution should have a well-thought-out plan that lets the CEO-to-be learn the job before they actually have to perfrom on their own.

The key steps to a solid succession plan should be simple and logical. Top players in finding a successor are a company's executives and human resource specialists. Common sense dictates a potential successor is knowledgeable and supportive of the company's business strategy and will reinforce corporate goals. That means a human resource executive should have the successor's credentials at their fingertips. They should know what education, experience and special skills and knowledge the successor possesses.

Here are some steps CEOs often follow when choosing a successor:

• Select the right person. This is often difficult because of the CEO's closeness to the job. The help of other executives, especially those who understand the job and will be affected by the change, should be enlisted. All employees with skill and knowledge should get consideration, and the future CEO should be considered alongside the future goals and needs of the business.
• While no one wants to hand over the job and scurry out the door, it's important to establish a schedule. This goes hand-in-hand with the training process. The successor should learn the job while doing, with a clear understanding of roles and responsibilities.

After the training is complete, the departing CEO should turn the job over and go. Of course, this formerly busy executive will have prepared in advance for leaving - including what they are going to do with the rest of their life - so they will actually leave and not return unless it's for a visit.

While planning a successor for the top job is crucial, company executives must remember all key jobs need the right people. The way to retaining talented people at all levels is to make sure they are in the right jobs to begin with and to provide growth opportunities for them.

Jim