The current urgency around succession management stems from the convergence of several external and internal trends. Confronted by continued economic pressure, increasingly competitive markets, and growing external scrutiny from shareholders, investors and regulators of their leadership bench strength, even the most successful organisations are realising that their future success will be severely compromised without a sufficient supply of talented leaders.
It is therefore not surprising that talent savvy executives have begun investing in the design and implementation of innovative, high-impact succession management strategies to ensure a sustainable supply of future leaders ready to drive results.
Notwithstanding these heightened demands and complexities, the traditional methods used to drive leadership succession have changed little, and are proving inadequate to meet the challenge. The consequences of not getting this right are evidenced in the growing rate of leadership failures at all leadership levels, record levels of employee disengagement, and an ever increasing mismatch between the demand for leadership talent and the skills available.
Not surprisingly, a growing crisis of confidence is starting to emerge, which can be attributed to a range of shortcomings associated with contemporary succession programmes, most notably:
• Poor articulation of the business case for succession management.
• Failure to translate strategic priorities into future leadership capabilities.
• Inadequate and inconsistent definitions of potential.
• Failure to differentiate between performance and potential.
• Use of inappropriate assessment instruments and methods.
• Reliance on generic, one dimensional leadership development programmes.
• Absence of relevant monitoring and measurement criteria.
• Lack of governance and oversight.
All of the above give rise to a number of risks, which if left unattended, can have dire implications for the effectiveness of leadership successions and the supply of leadership talent.
The most impactful of these potential risks include inter alia the risk of critical leadership positions remaining vacant for extended periods, appointed successors being ill-prepared to take on the responsibilities of their new roles, derailment due to poor on-boarding and assimilation into the new roles, and misalignment of individual capabilities with position requirements. It is essential that risks of this nature are identified timeously since each risk type demands an appropriate mitigation approach to ensure a sustainable outcome. Failure to do so is likely to result in the pursuit of a generic, undifferentiated succession management strategy that at best will deliver suboptimal results.
One emerging trend amongst exemplar organisations is movement beyond the traditional “names in boxes” replacement planning exercises to a more proactive, strategically aligned approach to succession management, where decisions are more objective and evidence-based with a strong emphasis on future focused leadership success criteria at all levels. This is in stark contrast to the informal or “intuitive” nature of many talent decisions in the past.
These organisations are viewing succession management as a series of parallel processes that involve understanding succession needs and employing strategies to address these across different time horizons.
A key component in this effort involves identifying the talent that already exists in the organisation and the employees that have the potential to be effective in other roles in the future. Significant resources are therefore being devoted to optimising their current performance, identifying their broader strengths and development needs and developing them for the next position in their career path as well as for long-term future performance.
This requires a dual focus on short- term selection and long-term prediction. To be effective, the succession management process therefore needs cater for the matching of individuals to specific known positions and responsibilities as well as predicting how much potential individuals have, with additional growth and development, to become eligible candidates in the future for a range of possible positions. In the latter scenario both the individuals concerned and the future positions are likely to change and evolve over time before appointment is considered.