So is Succession Planning for us? I noticed that much of the reading I was doing on the topic was from consulting companies that referred to global organizations. Most businesses, while doing work outside of their own geography, are not of the scope/scale of the organizations referenced.

We do not have the ’stomach’ for major programs

It our last Blog post, we referenced that Succession Planning is a process. The research that addresses small/medium companies and/or family businesses use that word as well. Ivan Landsberg, a Yale University expert in family businesses, coined the term Succession Conspiracy. Forces against a company’s leadership starting this process include:

• Reluctance to let go
• Personal loss of identity
• Fear of change
• Norms against discussing ‘mortality’

Start with Communication

To make succession work, the process needs to be discussed – pointing out (in actual truth) that this is a long-term process – 3 to 6 years in advance. Talking and actual planning can then be done in small but planful steps – with a timeline. The goals of the long timeframe are anything but transparent and very important:

• Pass the business along successfully
• Reassure employees, suppliers and customers (and family members if appropriate) that the business will continue

Statistics on family-owned businesses, a large portion of all businesses, are not optimistic regarding transitions. It is estimated that only 40% of businesses make it to the second generation; roughly 12% make it to the third generation.

At the end of the day, the company leadership has no greater responsibility than identifying who will foster the company’s continued viability and success. Start the process today.

Yes we have gone through a deep recession. People have put off their retirement plans; in some cases this is the second time retirement plans have been postponed. (How can we forget the economy of 2001/2002?) That said, demographic shifts will, in the very near future, create intense competition for talent. Combine that with the fact that the Conference Board Leading Economic Index ™ (LEI) has increased every month since May 2009 and you have the very early beginnings of economic improvement.

SHRM Future of the U.S. Labor Pool Survey Report

There have been multiple warnings about our aging labor force in many different reports. This particular report puts it very clearly:

• 82 million Baby Boomers are retiring; only 45 million Gen-Xers are available to replace them.

What are the obstacles?

• Lack of support from the top
• Resistance to change
• ‘Annual’ performance management programs
• Resistance by leaders to ‘let go’ of their best staff

It’s all about business

While there are certainly short-term issues that need to be considered when developing succession planning programs, the best and most successful programs start with business objectives. Most organizations have some sort of annual strategic planning session or process. This is the time to incorporate succession planning practices.

• What are the company’s short and long range goals?
• What are the strategies and related tactics for reaching those goals?
• What are the key roles (existing today and needed for tomorrow) necessary for achieving our goals?
• How can we assure we have the team in place to get us to where we want to go?

One-A-Day®

People often think of ‘programs’ like Succession Planning as an all-or-nothing event. The key is to start a process that can and should incorporate all of your ongoing/daily workforce management programs. Performance management, leadership development, training, retention/engagement activities and talent acquisition all need to come together. You are likely doing many of the necessary activities . . . . . bringing them together with a common purpose will be key (and the topic for future Blog entries).