When someone says to me, “This is the fourth person we’ve had in this job in six years; I hope he can make a go of it,” I respond, “It’s not likely.” Why? There is clearly a systemic performance failure: a problem with the position and the system around it. Instead of looking to the individual, you need to look to the staffing and talent-management processes—including succession planning.
Faced with constrained resources, many companies have trouble justifying an investment in talent management or succession planning beyond the traditional use for top executives and high-potential individuals. Following are all-too-common, real-world examples of systemic problems where succession planning becomes an urgent need.
Situation #1: Business growth dilutes experience in key positions.
Example: Most organizations regard growth as a good thing. What they may fail to recognize is that if you have an informal talent-development system—time and grade—growth brings dilution. Such was the case for a company that targeted aggressive expansion based on several years of sales growth. If it continued to add sales staff by entry-level hiring and promoting from within, in two years it would find itself with sales managers that had only three years of experience. Previously, sales managers were required to have 12 years of experience, because the market placed a high value on their ability to deal with clients’ business issues.
If you are filling the same position with less experienced people, they obviously do not have the same capability for making business judgments. The rate of change is no longer slow enough for people who come in at the bottom to assimilate before reaching upper-middle management. When a company fails to recognize that requirements in key positions are changing—whether due to internal change, such as rapid growth, or alterations in the business environment—it puts itself at risk.
Situation #2: A key position is suddenly no longer easy to staff because the number of available positions has increased or the talent pool has shrunk.
Example: As a U.S.-based multinational increased its global presence, it began having difficulty finding sufficient talent to go overseas as country managers. It experienced relatively high rejection rates for these critical senior jobs, as well as collateral damage: people were coming back early, experiencing family problems while abroad, etc. When it had only a few of these positions, the company could “troll” for the people who wanted them. That pool was exhausted.
The immediate solution was to aggressively rotate people at the levels prior to candidacy for country manager between U.S. and overseas assignments. The longer-term answer was putting processes in place to identify, prepare, transition, and support appropriate candidates.
Situation #3: An urgent demographic issue arises.
Example: This example is closest to the traditional application of succession planning. In a typical scenario, a board of directors suddenly recognizes that a significant number of senior executives will reach retirement age in the next five years and asks, “Where’s our bench strength?” This situation occurs because the corporate focus has been elsewhere: winning business, lower-level staffing, etc. Replacements for top positions are too often dealt with on an emergency staffing basis when an unanticipated exit occurs. At this point, the company, suddenly realizing it should never have allowed itself to be in this kind of crisis, launches a flurry of succession-planning activities.
The way to prevent systemic problems from recurring is to have renewable solutions in place. Successful organizations optimize their succession planning by balancing the individual perspective (labor pools, pipelines, competencies) with the position perspective (changing requirements, the position’s role in the business, and the system around it). That’s a very different perspective.
Selection and development tend to be individually oriented; systemic structure tends to be ignored. You may need to rebalance, paying more attention to the position, structure, and systemic problems that cause failure. In times of change, you need to continuously monitor actual circumstances—including the talent supply and demand sides—and adjust position requirements and development as needed.
Karen Searles Brethower, Ph.D., is an Ayers Group executive coach and consultant with extensive experience in talent management and succession planning. She has worked with organizations in a variety of industries experiencing radical change. For further information, call 212.726.7888.
