Putting the Success in Succession Planning
Nov 4th, 2019
“I see my role as CEO to prepare as many people as I can to be CEO”,
Tim Cook, CEO, Apple
Last month, Citi Group appointed Jane Fraser as President, in a move that has been widely seen as putting her in line to becoming the bank’s first woman chief executive. Citi’s current CEO Michael Corbat has said that there is no suggestion of an imminent change in the top spot and that he remains “committed to leading our firm in the coming years and working even more closely with Jane”. It’s a high-profile example of how intelligent succession planning can work to benefit all concerned, including the business.
But getting leadership transition right is not always simple. While researching for Talent Wins, Dominic Barton, the book’s co-author and Managing Partner Emeritus at McKinsey, found that two thirds of companies had no formal succession plan in place. And 2018 research by Deloitte showed that, “while 86 percent of leaders believe leadership succession planning is an ‘urgent’ or ‘important’ priority, only 14 percent believe they do it well”. Some do of course, like Citi or, famously, Steve Jobs, who not only worked hard to prepare Tim Cook as his successor, but also went as far as ensuring his management philosophy was embedded in the leadership curriculum at Apple University.
Not all business leaders may have the vision – or the resources – to go that far, but in my work with clients, I see how successful transitions can make all the difference. The CEO of one of the largest businesses in United Arab Emirates sees developing future leaders as such a priority that he makes it a key success metric when new leaders are appointed, tasking them with finding and developing their successor from day one. Not only does this make commercial sense, but it also recognises the potential of each new recruit, fuelling their own ambition and career path by showing them that he believes they are worthy of even more senior roles in the future.
Another client in the professional services industry is reviewing their succession planning process. Recently, the popular leader of one of its highest performing teams took the surprise decision to leave the company. This unexpected departure meant they had to react quickly to appoint a successor internally, manage the communication and address the inevitable drop in team members’ motivation, a challenge that they managed well under the circumstances. The risk of losing market share together with some key people is always high at times like this. De-risking the business by having short and long-term succession plans in place for every key role and reviewing them regularly is vital.
Succession planning is also about looking to your own future, sometimes in unexpected ways. One of my clients recently found herself concerned at her lack of excitement when she was offered a promotion. She invested in taking time out to clarify her vision professionally and personally and enrolled in our One-to-One Vision Intensive programme. During the programme she realised she felt passionate about a different role in the organisation. This role would tap into her natural strengths, align more naturally with her personal aspirations and allow her to add greater value to the business. We recognised that she needed to identify her successor as part of the strategy to make this career move happen. We worked on finding, developing and raising the profile of that person, and today my client is relishing her new role at the helm of her company’s most profitable division – which she describes as her “dream job”.
I have seen a marked increase in the number of people in the final stages of their career who want clarity over what ‘retirement’ looks like for them. These are change makers who want to leave a legacy, but who also want to feel excited about their own next chapter, perhaps as a consultant, or combining family time with a new business. Helping them plan and write that chapter can give them the energy they need to look at how a successor might step into their shoes.
If your organisation needs to re-think the way it plans for leadership transition, or you are looking ahead to your next career move or planning a fulfilling ‘retirement’ here are some ideas to help you move forward:
- Frame and reward succession planning as a key leadership skill
Planning for change is essential in business and taking a proactive and farsighted approach to succession is a key skill. It allows leaders to develop teams, de-risk their organisation and fulfil their own aspirations, making it much more than just an HR process. By including succession planning as a key metric for success for all executives, leaders like my client in the Middle East create a culture that rewards success.
- Identify your own and others’ greatest strengths
People who bring in the greatest revenue often get promoted to leading bigger and bigger teams, but may not have the people development skills they need to succeed. It’s a leader’s responsibility to develop future leaders and to know who’s naturally good at what and tap into that strength for the benefit of the business. People who focus on their natural talents can achieve true mastery of them, and that applies to you as you look to your future, as well as to the teams you lead.
- Take time to identify and develop your successor
It may not be easy to find the person that’s right to take over from you as you move on to your next leadership step, so allocate dedicated time to your search. Think about the qualities that fit into the culture as well as the skills. Once you know who they are, work closely with them and give them the opportunities to experience and develop those skills to ease the transition. Work on raising their profile, so that others see them as your successor too. It might help you move into your dream job!
- Enjoy the view
Ambitious people are always looking ahead. What is next for you? People who are successful in what they do can get so wrapped up in it that they may lack balance. Feeling the excitement of a possible future role can give you the energy to look at your day to day work with new clarity.
- Future-proof your future leaders
Nobody needs a crystal ball to know that the world, and business, is changing fast. So when you are working to identify the leaders who may take on key positions in the future, try to identify how those roles may change and develop your key talent accordingly, by getting them to work on new projects in line with the changes ahead.
- Strike the right balance
If you are looking forward to retirement, the legacy you leave behind as a leader will always be important to you. But make sure you’re also looking forward to what you want for yourself. Today, 60 is the new 40 and, after a successful career, the world is your oyster, so tap into what you really long for. That way you’ll successfully shape your own future as well as continuing to shape the future of the organisation you are leaving.
- The right time is right now!
People often believe that starting succession planning three years before a leader is due to retire is sufficient. But it is in fact a minimum. Many successful companies have both emergency and long-term succession plans that cover more than imminent retirees – because the unexpected happens more often than you might think! Today’s businesses must be increasingly agile, so planning for tomorrow today is essential.
I say to all my clients in transition, you need to be the leader you want to be before you become it, so you are ready when it happens. Make your current role the starting point and practice the mind-set, communication and body language of what it means to be that leader. Begin now and be the best you can be.
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