by Tom Casey, Managing Principal Discussion Partner Collaborative
Welcome to 2017! Given the geo-political dynamics before us, this year portends to be a roller coaster ride!
As we enter the New Year and update our “resolutions” from new to carry forward, my colleagues at Discussion Partners and I would strongly urge an elevation of, and renewed attentiveness to, Succession and Continuity planning as a priority!
Notwithstanding pre-existing protocols we are suggesting this review encompass the most generous interpretation of processes concomitant with experimental and disruptive solution sets.
Our recommendation is driven by results of a December 2016 study DPC conducted with 1700 C-Suite participants. The survey was on the topic of envisioned 2017 challenges. 94% of those surveyed indicated “the ability to attract, motivate, and retain top talent” as their #1 concern.
Discussion Partner’s has been conducting this annual Pulse survey since our founding in 2007. The intensity of the above concern while always “on the list” was never #1. In addition the rationales expressed in the anecdotal justifications were compelling inclusive of envisioned shifting demographics, new worker expectations, disruption of organization models, competitive pressures, globalization, and ineffective human capital practices.
Our recommendation is further reinforced by a review of the recent literature on this topic.
- The strategic imperative for Talent depth to be an asset vs. liability referenced in consolidated research on Leadership Succession/Continuity most recently December 2016 series of articles in HBR and previewed upcoming articles in Sloan Management Review
- The Point of View that has emerged from our 2016 Advisory work that 2017 represents an opportunity to use a “Disruptive Organization Model” for Talent processes overall and Leadership matters in particular
As further justification for this Recommendation the following foundation is provided.
- Dr. Noel Tichy in his recent book Succession asserts that without proactive planning on how to fill, and inventory of talent well in advance of leadership, and/or key role “vacancies”, the chance of success is below 50% for replacement personnel
- Ram Charan in his book The Attackers Advantage and December 2016 HBR articles offers the following (paraphrased) – Leaders (Directors, Owners, CEO’s) who excel at selection are willing to expand the lens in how they look at the capabilities of reporting levels beyond performance track record to the 2 to 3 interwoven predictive behaviors that will be necessary for success
- The following compelling data points are from various sources (Booz Allen, McKinsey, Hedrick & Struggles, Korn Ferry and Saratoga Institute)
- Team Building and Empathy are as important as Performance for promoting enterprise success (often stated infrequently realized)
- 55% of the Fortune 500 Boards of Directors have expressed dissatisfaction with the Succession Planning processes of their enterprises including the CEO replacement approach
- A study of the 2500 largest companies on the planet indicate that inefficient Succession Planning on average results in $1.8B losses during transition
- Underperformance does not incent change 45% below peer group by sector correlates to only 5.7% probability in change of leadership
- 39% of the Fortune 1000 Boards indicate “no viable candidate” to replace the CEO compelling a similar % undertaking external hires which Charan stipulates as “highly unlikely to be successful”
In the context of the recent HBR assertion “Succession Planning takes years not months” DPC would recommend the following steps:
- Senior level stakeholder interviews focused on “beyond task proficiency” what are the essential differentiating qualities that will be needed for success
- Comparative Inventory of Leaders (broad based) and high potentials in relationship to these attributes
- Embed into developmental and hiring strategies the lessons learned from this exercise
- Creation of a Critical Constituency Depth Chart whereby the following is highlighted
- Identification of 1 ready now replacement
- Identification of 2 possible replacements
- Identification of external Search capabilities to be deployed in emergencies and/or lack of “ready now” sense of urgency
- Assignment of non-senior leaders a “personal growth and development task” similar to the GE “popcorn stand” to provide additional evaluative foundation
The New England Patriots have a mantra of “do your job” four Superbowls and #1 seed for 2016 indicates the validity of this philosophy. However, DPC would argue in the commercial sector this would be limiting for the medium to long term for any existing organization. Our impetus is that the above suggestions represent process steps that should be presently underway and if not, a sense of urgency should exist. DPC would substitute the words “do the job you should have been doing all along”!
Additionally we would embed the following questions:
- What skills sets will we need beyond domain proficiency to have a sustainable growth oriented enterprise?
- How does our current population of Leaders and Future Leaders compare to these desired attributes?
- How can we develop and/or hire sufficient numbers of people to address deficiencies in the above?
- What is the true nature of our Leadership bench in respect to Readiness?
- What is our contingency plan to be deployed if necessary?
From whatever vantage point you situate, this year will be dynamic. As a suggestion, borrowing a title from a previous book by Dr. Tichy on the topic of leadership Control Your Destiny-Or Somebody Else Will!