GUIDE
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SUCCESSION PLANNING
The 4 Crucial Steps to Developing Leaders Who Can Transform Your Business
Rome wasn’t built in a day, and great organisations aren’t built overnight. They’re not built in a month or, often, even a year. It takes time to create a strong organisation, and it starts with a strong foundation of leaders.
Developing leaders is one of the hardest and most underrated strategic workforce planning activities in many organisations. The word ‘leader’ is autological in that leaders lead in every sense of the word: they set the tone for organisational culture, team dynamics, productivity, communication, aligning work for business objectives, overcoming obstacles and holding accountability.
So, while tricky, developing great leaders should be at the top of your priority list. Here’s how to do it (and do it well) and exactly how it can transform your workplace.
Why you should care about developing leaders in your organisation
Any executive and HR professional worth their salt knows an organisation is only as strong as its leaders. And we’re not just talking about those at the top; leaders are those role that influence and direct others. It all comes down to a shrewd workforce planning strategy, AKA having the right people in the right place at the right time to ensure organisational success.
Consider that having the right person in a leadership role generates 48% higher profitability for an organisation than average managers. And then think about how Gallup has found organisations fail to choose a candidate with the right skills for a job 82% of the time. After that, only one in 10 possess the talent to actually manage—because, quite often candidates are considered in terms of their talent, not their people management skills.
Why you need to know this
Leadership is a fluid practice; a good leader both anticipates the needs of their environment and can react in the most effective and efficient way to evolving events. That aforementioned 10% of leaders with the right skills can naturally engage both subordinates and customers, retain and nurture top talent, and maintain high productivity. But the rest? They need a little push. Only 24% of leadership skills come naturally; the remaining 76% is learned. Not all leaders are born, and turning a self-managing individual contributor into a multi-hat wearing leader who is a direct driver of organisational success takes time and an investment in their development.
How to develop great leaders in your workforce
First and foremost: cultivating great and future leaders should be an ongoing process. Priming an employee for succession is one thing, but leaving L&D at the door of their new office is exactly why many newly minted leaders fail. We’ve seen many organisations believe that all it takes to be, say, a marketing head is to be accomplished at marketing. But how does one lead a whole marketing team? Manage business strategy? Make smart financial choices? Build consensus?
It’s easier than it seems to develop those skills. There are a number of strategies you can employ to build a strong and steady leadership pipeline.
Focus on development
If you defy all other strategies (but please, we beg of you, don’t), don’t ignore this one: your succession management plan must be flexible and development-focused. It should never be focused on the people who could ‘best fit’ an empty role or one that will be vacated in future. Integrating succession planning with learning and development gives you the best of both worlds. You get the existing skills and experience with a culture of continual learning. It also helps avoid any previously hidden and detrimental limitations that could be exposed under pressure.
How to
Pair educational leadership events with real-life exposure to a variety of job assignments before an employee assumes a role. This gives them the expertise and the chance to understand the nuances of utilising that knowledge in the workplace. Personalise the process with job rotations, special assignments or mentoring, so an individual highlighted for succession can truly understand what is expected of them.
The implications of not focusing on development
Succession planning and leadership development share a vital goal: getting the right skills in the right place. Without succession planning, you may have the right skills but no idea of where are they needed. Without leadership development, you’ll likely have a list of people cherrypicked for promotion, but without the full spectrum of capabilities a role with more responsibilities requires. Either way, your organisational structure becomes unstable—because one position that is empty too long or one key role filled by an individual lacking the right skills could cause the whole thing to crumble (and possibly take your profitability, reputation and market standing down with it).
Pinpoint vital roles
Where succession planning generally concerns itself on a few top positions, the crux of leadership development begins in the middle. Your development plans should have a particular interest in the vital job roles that are essential to the long-term health of an organisation. These can be difficult to fill, usually exist in established areas of business and are crucial for future growth. Yes, we’re talking about the middle manager.
When you train and develop managers, you’re first ensuring your supply of leadership talent is adequate at all times—which then means it’s adequate when you need it to be. It’s often the first point in the organisational structure where employees take on a leadership role, which means it’s important to imbue them with the hard and soft skills they’ll need to be successful.
How to
While it may seem like a fancy form of negging, it is actually helpful to conduct reviews of your workforce with the intention of highlighting any experiential or performance issues potential successors may have so they can be addressed in development programs. This has the added benefit of ensuring you’re not just looking at the good outcomes, but also preparing for the bad. (And this is just good workforce planning.)
The implications of ignoring middle managers
Just why are middle managers so vital, you ask?
- They’re the link between company vision and strategies and the individual contributor employees who execute it on a day-to-day basis.
- They’re learning to understand an incredibly diverse, multi-generational workforce that their predecessors didn’t contend with.
- Middle management is the leadership role with the biggest impact on culture and employee satisfaction.
- They are, perhaps most importantly, the next generation of leaders in your organisation.
This is the position in which many leaders first learn project and people management skills—responsibilities like task allocation and deadline supervision aren’t glamorous, but they are crucial to the health of your organisation. If managers don’t have the confidence, know how or acumen to align the right people and skills to the right projects, efficiency goes out the window and you can say goodbye to achieving any desired business outcomes on time, if at all.
Be transparent
An old rule of thumb is to shroud leadership fast tracks in secrecy so no one is upset. It’s a somewhat misguided approach that is built off the idea that if you don’t know where you stand, you’ll still fight to climb the ladder. Today’s succession planning is less loyal to seniority than it is performance, which is exactly why you need to be transparent with your potential leaders. Transparency creates trust and builds buy-in, it’s really as simple as that.
How to
Employees are your best source of information about, well, your employees. Through performance reviews or the astute tracking mechanisms of a learning management system, you can map out current capabilities and experience against the job roles you predict you’ll need in future. And when you align this with learning and development programs, it gives employees an actual goal to work towards rather than a blind shot in the dark.
It also takes a little weight off HR’s shoulders; simply put, many eLearning systems enable the creation of learning pathways that will autonomously populate an employee’s dashboard with the coursework needed for career progression. So, while you’re not showing employees exactly where they sit on the succession board, you demonstrating an investment in their future with your organisation.
The implications of keeping employees out of the loop
There’s this belief top performers always want to ascend. But keep in mind an obvious skill is not an indicator of ambition. An opaque leadership track disregards the commitment or motivation an individual may have for promotion, which could put an unhappy and anxious person in a leadership position they don’t want or are ill-equipped to perform. On the flip side, there’s a chance you could lose top talent to rivals purely because they couldn’t see pathways to grow. Plenty of individual contributors may also possess the drive and ambition to ascend, but not the skills that an organisational view bases succession on. All of these scenarios are harder to remedy once you’ve opened the can of worms.
Evaluate regularly
Succession is not about replacement. Replacement is a short-term solution, and developing leaders is a long-term and fluid initiative. Succession planning then becomes about moving the right people into the right job at the right time (a delicate balance), from a pool of candidates that is constantly evolving to reflect current, future and necessary capabilities, ambitions and job roles. Combined with a transparent approach, potential successors can be sure they have many opportunities available to them.
How to
Keeping the river flowing smoothly requires regular check-ups that identify potential risks before they flare up. There are many options for measuring progress, depending on organisational needs:
- You might consider measuring successor attrition rates against the rates of the entire employee population to ascertain if the former group is satisfied with their development.
- Tracking progress through a learning management system is a highly accurate way to measure development against learning objectives and future required capabilities.
- Creating learning ‘milestones’ for employees to complete that are viewed by HR systems as progress checks. This helps break up the succession pathway into manageable sections, motivating leaders with goals to work towards.
- Performance reviews that not only discuss an employee’s output, but their ambitions and feedback on their personal development pathway.
The implications of failing to re-evaluate
If you don’t keep track of leadership development, you won’t have the data you need on which to enact succession or strategic workforce plans. And making decisions on key roles based on inaccurate data could put you in a position you’re attempting to avoid: a newly minted manager who’s not prepared for the role. You may also find that as you forecast for the future or experience environmental changes, development ways of old aren’t keeping up. It’s also possible you’ll lose track of the capabilities expected of potential leaders, which puts you back at square one and hiring or promoting without understanding the skills truly needed.
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