Post Pandemic Succession Planning: Winning the War for Talent – Is Your HR Team Ready?
If you ever studied the American Revolutionary War in history class, you may remember reading about Baron Friedrich Wilhelm von Steuben, a military leader recruited by General George Washington to serve as the drillmaster of the Continental Army. Incredibly, von Steuben managed to turn a ragtag collection of farmers and stable boys into an officer corps that led the Americans to victory.
“Okay,” you’re thinking. “But what does that have to do with succession planning?”
Simple. General Washington’s forces faced a well-trained army of British con- scripts and Hessian mercenaries. If Washington was to level the playing field, he’d need to recruit a skilled outsider who knew the enemy and what it would take to defeat them — namely, Baron von Steuben. Washington knew he couldn’t achieve victory with second-rate people — and neither can you.
The demand for leadership talent greatly exceeds supply.
If economic growth continues at a modest 2 percent for the next 15 years, there would be a need for one-third more senior leaders than there are today. As we come out of the COVID-19 Pandemic demand for the best people will surely skyrocket as the business playing field is further leveled.
Who will replace your retiring executives or those who move to greener pastures, and how will you keep your company’s leadership pipeline full?
Baby boomers have already started to retire. Most large companies will have to scramble to meet gaps in senior leadership talent. A lower birth rate—at least in North America—has made it difficult to fill the shoes of older outgoing executives. But that’s not the only reason.
Another cause is that few companies provide young workers with the training they need to advance. In fact, according to a 10-year study of executive performance by a leadership consulting firm called Navalent:
- “76% of respondents indicated the formal development processes of their organization were not, or at best minimally, helpful in preparing them for the executive role.”
- “55% indicated that they had minimal, if any, ongoing coaching and feedback to help them refine their ability to perform in an executive role.”
- “45% indicated they had minimal understanding of the challenges they would face in an executive role.”
Although young executives have begun to assume senior and C-suite roles, according to Navalent, they lack the “experience, knowledge, relational, and emotional maturity necessary to sustain success.”
Who will replace your retiring executives, and how will you keep your company’s leadership pipeline full?
To make matters worse, the global and more dynamic economy of the 21st century requires executive talent with a more complex skill set:
- Greater technological literacy
- A sophisticated understanding of global marketplaces
- Multicultural fluency
- Relationship savvy, with extensive networks of alliances and stakeholders
- Leadership skills over a delayered, disaggregated and virtual organization
Succession Planning in the 21st Century post COVID-19
In response to these challenges, organizations have a renewed interest in succession planning systems. While these systems functioned merely as replacement charts in the past, and was a general function of HR, there are two critical differences today, emphasizing:
- The focus of the HR Executive on strategic planning and the responsibility and involvement for leadership development within the work group, with the person’s manager and team members (a joint-management effort)
- Leadership development at all levels (not just senior executives)
Distinct Leadership Levels
Most development models fail to consider leadership requirements at all levels. As a person is promoted from line manager to business manager to business manager, skills and requirements change.
Companies mistakenly focus on leadership traits, styles and technical competence. They commit a major error when promoting technically successful individuals without acknowledging the required experience and skill set differences that are essential at different levels of leadership responsibility.
The Leadership Pipeline
Hiring gifted people makes sense as a tactic, but not a strategy. Companies need to build leaders, not buy them. (Heresy coming from an executive recruiter? Hardly. I want to recruit for well run companies too.) History and personal experience show that potential is not fixed.
The more people achieve, the more they learn. Their willingness to tackle new challenges increases. To capitalize on potential, companies must define the true work requirements at each key leadership level. Succession planning systems must spell out what is needed to make a successful transition from one layer of leadership responsibility to the next.
Succession Planning to Fill the Pipeline
The following five-step plan will facilitate succession planning:
- Tailor a leadership pipeline model to fit your organization’s succession needs.
- Clarify standards for performance and potential, in your own language.
- Document and communicate these standards throughout the organization.
- Evaluate succession candidates through a combined potential-performance matrix.
- Review plans and progress of the entire pipeline frequently and seriously.
As part of a succession plan, smart companies maintain a leadership pipeline. As explained by Jack Zenger at Forbes,
“a leadership pipeline is used to create a more systematic, visible system of identifying candidates for succession, combined with the processes for their development.”
Pipeline development is a crucial component of any successful succession plan and gives you a big jump if you have to replace an outgoing executive.
Firms that must rely on external recruitment during a transition in leadership will find smaller and smaller pools of qualified, talented executives—and increased competition to hire those same executives. This puts these firms at risk. Developing a leadership pipeline offers an important safety net. Organizations that invest in developing a leadership pipeline are better positioned to thrive in the face of change.
The best of all possible worlds is to have a strong pool of internal talent, which you can benchmark against a strong pool of external candidates. This enables you to select the right person at the right time.
With talented leaders retiring at an ever-increasing rate, companies that do not prioritize succession planning will find themselves at a distinct competitive disadvantage! Waiting around in the hopes your ideal executive will miraculously become available precisely when you need her is foolishness.
In today’s hyper-competitive environment, business is war! If you’re going to win, only the best executives can lead the charge. Locating and enlisting those executives is what succession planning is all about.
Is your HR Leadership, ready?