Effective Succession Planning

Ensuring Leadership Continuity and Building Talent from Within

William Rothwell

• Publisher: AMACOM
• Year: 2010
• eBook ISBN: 9780814414170
• Topic: Business
• Subtopic: Mentoring & Coaching
• Index: Business

William Rothwell honored with the ASTD Distinguished Contribution Award in Workplace Learning and Performance. The definitive guide to a timely and timeless topic-- now fully revised and updated. As baby boomers continue to retire en masse from executive suites, managerial offices, and specialized or technical jobs, the question is—who will take their places? This loss of valuable institutional memory has made it apparent that no organization can afford to be without a strong succession program. Now in its fourth edition, Effective Succession Planning provides the tools organizations need to establish, revitalize, or revise their own succession planning and management (SP&M) programs. The book has been fully updated to address challenges brought on by sea changes such as globalization, recession, technology, and the aftereffects of the terror attacks. It features new sections on identifying and assessing competencies and future needs; management vs. technical succession planning; and ethics and conduct; and new chapters on integrating recruitment and retention strategies with succession planning programs. This edition incorporates the results of two extensive new surveys, and includes a Quick Start guide to help begin immediate implementation as well as a CD-ROM packed with assessments, checklists, customizable guides, and other practical tools.

PART I

Background Information About
Succession Planning and
Management

CHAPTER 1

What Is Succession Planning
and Management?

Six Ministudies:
Can You Solve These Succession Problems?

How is your organization handling succession planning and management (SP&M)? Read the following vignettes and, on a separate sheet, describe how your organization would solve the problem presented in each. If you can offer an effective solution to all the problems in the vignettes, then your organization may already have an effective SP&M program in place; if not, your organization may have an urgent need to devote more attention to succession issues.

Vignette 1

An airplane crashes in the desert, killing all on board. Among the passengers are several top managers of Acme Engineering, a successful consulting firm. When the vice president of human resources at Acme is summoned to the phone to receive the news, she gasps, turns pale, looks blankly at her secretary, and breathlessly voices the first question that enters her mind: “Now who’s in charge?”

Vignette 2

On the way to a business meeting in Bogota, Colombia, the CEO of Normal Fixtures (a maker of ceramic bathroom fixtures) is seized and held for ransom by freedom fighters. They demand U.S. $1 million within 72 hours, or they will kill him. Members of the corporate board are beside themselves with concern.

Vignette 3

Georgina Myers, supervisor of a key assembly line, has just called in sick after two years of perfect attendance. She personally handles all purchasing and production scheduling in the small plant, as well as overseeing the assembly line. The production manager, Mary Rawlings, does not know how the plant will function in the absence of this key employee, who carries in her head essential and proprietary knowledge of production operations. She is sure that production will be lost today because Georgina has no trained backup.

Vignette 4

Marietta Diaz was not promoted to supervisor. She is convinced that she is a victim of racial and sexual discrimination. Her manager, Wilson Smith, assures her that that is not the case. He explains his reason to her: “You just don’t have the skills and experience to do the work. Gordon Hague, who was promoted, already possesses those skills. The decision was based strictly on individual merit and supervisory job requirements.” But Marietta remains troubled. How, she wonders, could Gordon have acquired those skills in his previous nonsupervisory job?

Vignette 5

Morton Wile is about to retire as CEO of Multiplex Systems. For several years he has been grooming L. Carson Adams as his successor. Adams has held the posts of executive vice president and chief operating officer, and his performance has been exemplary in those positions. Wile has long been convinced that Adams will make an excellent CEO. But, as his retirement date approaches, Wile has recently been hearing questions about his choice. Several division vice presidents and members of the board of directors have asked him privately how wise it is to allow Adams to take over, since (it is whispered) he has had a long-term, high-profile extramarital affair with his secretary and is rumored to be an alcoholic. How, they wonder, can he be chosen to assume the top leadership position when he is burdened with such personal baggage? Wile is loathe to talk to Adams about these matters because he does not want to police anyone’s personal life. But he is sufficiently troubled to think about initiating an executive search for a CEO candidate from outside the company.

Vignette 6

Linda Childress is general manager of a large consumer products plant in the Midwest. She has helped her plant weather many storms. The first was a corporate-sponsored voluntary early retirement program, which began eight years ago. In that program Linda lost her most experienced workers, and among its effects on the plant were costly work redistributions, retraining, retooling, and automation. The second storm was a forced layoff that occurred five years ago, driven by fierce foreign competition in consumer products. The layoff cost Linda fully one-fourth of her most recently hired workers and many middle managers, professionals, and technical employees. It also led to a net loss of protected labor groups in the plant’s workforce to a level well below what had taken the company ten years of ambitious efforts to achieve. Other consequences were increasingly aggressive union actions in the plant; isolated incidents of violence against management personnel by disgruntled workers; growing evidence of theft, pilferage, and employee sabotage; and skyrocketing absenteeism and turnover rates.

The third storm swept the plant on the heels of the layoff. Just three years ago corporate headquarters announced a company-wide process improvement program. Its aims were to improve product quality and customer service, build worker involvement and empowerment, reduce scrap rates, and meet competition from abroad. Although the goals were laudable, the program was greeted with skepticism because it was introduced so soon after the layoff. Many employees—and supervisors—voiced the opinion that “corporate headquarters is using process improvement to clean up the mess they created by chopping heads first and asking questions about work reallocation later.” However, because job security is an issue of paramount importance to everyone at the plant, the external consultant sent by corporate headquarters to introduce the process improvement program received grudging cooperation. But the process improvement initiative has created side effects of its own. One is that executives, middle managers, and supervisors are uncertain about their roles and the results expected of them. Another is that employees, pressured to do better work with fewer resources, are complaining bitterly about compensation or other reward practices that they feel do not reflect their increased responsibilities, efforts, or productivity. And a fourth storm is brewing. Corporate executives, it is rumored, are considering moving all production facilities offshore to take advantage of reduced labor and employee health-care insurance costs. Many employees are worried that this is really not a rumor but a fact.

Against this backdrop, Linda has noticed that it is becoming more difficult to find backups for hourly workers and to ensure leadership continuity in the plant’s middle- and top-management ranks. Although the company has long conducted an annual succession planning and management ritual, in which standardized forms, supplied by corporate headquarters, are sent out to managers by the plant’s human resources department, Linda cannot remember when the forms were actually used during a talent search. The major reason, Linda believes, is that managers and employees have rarely followed through on the individual development plans (IDPs) established to prepare people for advancement opportunities.

Defining Succession Planning and Management

As these vignettes illustrate, organizations need to plan for talent to assume key leadership or backup positions on a temporary or permanent basis. Real-world cases have figured prominently in the business press. (See Exhibits 1-1 and 1-2.)

Among the first writers to recognize that universal organizational need was Henri Fayol (1841–1925). Fayol’s classic 14 points of management, first enunciated early in the twentieth century and still widely regarded today, indicate that management has a responsibility to ensure the “stability of tenure of personnel.”¹ If that need is ignored, Fayol believed, key positions would end up being filled by ill-prepared people.

Succession planning and management (SP&M) is the process that helps stabilize the tenure of personnel. It is perhaps best understood as any effort designed to ensure the continued effective performance of an organization, division, department, or work group by providing for the development, replacement, and strategic application of key people over time.

Succession planning has been defined as:

a means of identifying critical management positions, starting at the levels of project manager and supervisor and extending up to the highest position in the organization. Succession planning also describes managem...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Dedication
• Contents
• List of Exhibits
• Preface to the Third Edition
• Acknowledgments
• Advance Organizer for This Book
• Quick Start Guide
• What’s On the CD?
• Part I: Background Information About Succession Planning and Management
• Part II: Laying the Foundation for a Succession Planning and Management Program
• Part III: Assessing the Present and the Future
• Part IV: Closing the Developmental Gap: Operating and Evaluating an SP&M Program
• Appendix I: Frequently Asked Questions (FAQs) About Succession Planning and Management
• Appendix II: Case Studies On Succession Planning and Management
• Notes
• Index
• About the Author