Business Excellence Series Title – 8
(Succession Planning – 2/4)
The importance of Succession Planning initiative in any organization, does not need any elaboration. However, many organizations are not able to initiate the process and many of those who initiate, get into unexpected stumbling blocks leading to undesirable outcomes. These aspects were discussed in detail in my previous article https://www.unleashpotential.in/post/succession-planning-benchmarking-with-the-best
As shared in that article, in one of the organizations where I was leading Human Resource function, we implemented the succession planning process for senior leadership team in very effective manner, but not without innumerable hurdles. By collectively overcoming those challenges, we were able to achieve remarkable outcomes.
Without the right succession planning put to play in human resources, we build for the future without a future – Mmanti Umoh
The external hiring of leaders decreased from 80%to less than 35% in 3 years, leading to increased motivation of employees witnessing immense internal growth opportunities, reduced transition time during change of incumbent in leadership roles and significant cost savings, among other innumerable business related benefits. The intervention included roles in top management team as well as up to 2 levels below the top.
It is important to mention that while certain benefits in terms of increased motivation of HiPots and enhanced visibility of organization commitment towards development of employees, were felt soon, the significant outcomes of succession planning were visible only after 3 years or in 5th and 6th Talent review meeting, scheduled every six months.
The above model is a comprehensive depiction of almost all aspects of Succession Planning, that were considered by us, which include intended outcomes, major pillars of the process and soft critical issues that need to be managed for effective implementation. While each step of the process is very important and need to be executed with every detail, it has been observed that the hidden, rather abstract soft aspects, mostly become the reason of failure,
The six major pillars of succession planning process, which were focused in a systematic manner year after year, have been discussed in some detail in the article. The attempt in this article is to spell out the process in very simple terms, so that anyone wanting to implement succession planning in their organization, gets a good insight into the process. The softer aspects mentioned in outermost circle in the above model, will be taken up in next article in this series, along with the way those were addressed for avoiding any hurdles.
Identification of Critical Roles
Succession planning is best done for limited number of key roles in the organization, as it requires significant commitment of time from top leaders and investment of financial resources by the organization.
We identified 15 key roles out of 250 plus roles in the organization for this initiative. The selection was done by the leadership team, on top-down basis, deliberating on each role keeping in view overall profile requirement including competencies critical to business. The first most critical step was to clarify the current role holders of these positions regarding their future opportunities, thereby making them willingly eager to contribute in the process.
As soon as succession planning is initiated for any set of roles, their current role holders naturally start having a feeling of insecurity, unless they have clarity about their future roles. As successors become ready to occupy the role in 2-3 years, the current incumbent need to be voluntarily prepared to move to the new role, rather she/he should be excited and looking forward to the new role. In absence of this clarity, the role holders themselves could become hurdle in succession planning process. On the other hand, if the current role holder has been made aware about his/her growth opportunity and is looking forward to that movement, she will go an extra mile to see that the successor is made ready as per planned timeline.
Talent Review
Talent Review board was formed with representation of senior leaders from all key functions, including CXOs and CEO. The scope of the Talent Review meeting included mapping business needs with respect to the current and future capacity, capability and potential of the organization. At the same time, it was also extended to review the High Potential employees (HiPos), to plan their development and growth trajectory.
These reviews were six monthly structured and facilitated meetings, where identified employees were reviewed in terms of their key strength, areas of improvement, special contributions, specific critical incidents, career goals, degree of readiness for promotion and their development plans. The first meeting needed plotting of all leaders on 3x3 Performance - Potential matrix in an objective manner and subsequent deliberations used to focus on reviewing their positioning and any changes needed in the same.
The HR team used to provide all relevant details of the individuals to be discussed, one week before the review meeting. This included their complete career history, performance assessment outcomes, last positioning and key aspects deliberated in previous meetings including certain conceptual aspects like how potential is measured etc. It was the responsibility of respective reporting managers to represent their employees at this meeting and it was the responsibility of HR to oversee the process, facilitate discussion, calibrate the evidence and information sharing.
The deliberations by all business/ functional leaders in these meetings were captured, in detail, by HR apart from specific positioning and movements of people in 9 Box Grid of Performance and Potential, for consistent discussions in subsequent meetings.
Identification of Successors
An important discussion point during Talent review meetings used to be the identification of successors based on their profile, performance and potential. While in many cases, the obvious successor to a role may be the person who is immediately next in line in the organizational chart, but that may or may not be the best choice. It is therefore important to search with open mind and look for people who display the skills necessary to thrive in higher positions, regardless of their current title.
During Talent Reviews, each position identified for succession planning was discussed and everyone's input taken regarding names of possible successors. All leaders used to share their nominations for various roles, based on their personal experience and perceptions. The same were deliberated by Talent Review board at length keeping in view functional and behavioral competence requirements of the role vis-à-vis capabilities displayed by the candidate so far and his envisaged potential.
Normally 2-3 potential successors were identified, hedging the risk of depending on one person and possibility of his/her not coming up to the expectations or getting into some controversial situation or exiting the organization. Also, the extent of readiness of each of them was discussed, as it was possible that some candidates were almost ready, some needing 1-2 years and other requiring 2-3 years' time before taking over the higher position.
Development Plan for Successors
The most important action items emerging from Talent Review discussions were in terms of development actions to be taken for potential successors. A detailed Individual Development Plan was prepared for each identified successor keeping in view their current capabilities and expected competencies for the targeted role. The objective methodology of Assessment/ Development Centers was also used for assessing the competence levels and drawing out the development actions. This was a comprehensive plan to groom and make them ready to take up new role with full confidence and preparedness, which included regular development discussions with the identified successor.
This investment was committed by the organization, in terms of financial resources as well as time of successors and mentors. In one-on-one meetings, each protégé was explained that they have been identified for positions of high importance, from among a large set of prospects. It was also conveyed to them that they need to take complete ownership of their development plan with complete support of the organization, and at the same time, there are no guarantees, as the situation can change due to circumstances encountered by either the company or by the candidate's own contribution, performance and initiative.
Governance Mechanism
A robust governance mechanism was put in place to ensure that the decisions taken by Talent Review Board and those outlined in Individual Development Plans were implemented in letter and spirit. While the progress was reviewed in next Talent Review meeting after 6 months, an additional quarterly review was done by Head HR and CEO to address any constraints or introduce much needed course corrections.
The HR team took ownership of closely working with all concerned stakeholders to ensure smooth implementation and raise red flag, as soon as something got stuck. The commitment towards effective implementation of decisions taken and governance mechanism as such, was the key to success.
Linkage with Leadership hiring process
The target taken for filling identified leadership positions through internal candidates was pegged at 70%. It was decided from the view point that all successors can not be groomed internally and also that some infusion of fresh talent from other organizations/ industries may further enrich the leadership team. Accordingly, an effective linkage was established between succession plan and leadership hiring plan, to ensure timely fulfilment of gaps by Talent Acquisition team.
Each of the above steps needed to be planned in an elaborate manner in terms of process, time-lines, progress review, course correction, stakeholder involvement and so on. These were very effectively handled as we had an expert inhouse HR team as well as committed business leaders, who could handle all these challenges very efficiently. Many organizations, who do not have such internal expertise and commitment, need to take help of some external experts to design and facilitate implementation of these processes. However, the more difficult part, which gets missed out by many consultants, is mostly related to softer aspects, that can lead to total collapse of the intervention.
As these steps were executed very effectively, with complete involvement of all functional and business leaders, the journey was not smooth. Many hurdles were faced at every stage, that needed to be resolved on the spot. The challenges were not only in terms of finding time and commitment of stakeholders involved, but many more, related soft aspects posing major bottlenecks. Some of the tricky issues to handle were -
Sense of insecurity for current role holder whose successor is being planned
WIIFM ( What's In It For Me) at all levels of organization
FOMO (Fear of Missing Out) by some High performers and High potential employees
Organization readiness to announce list of potential successors
Engagement of senior leadership
Buy-in of Operational leaders
Priority within intense business demands
Institutionalization of company culture
I will be discussing the above softer aspects which could lead to many complications and pose immense challenge on the process, along with possible ways to handle them, in more detail in next article of this series on Succession Planning.
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