Succession Planning is the process of identifying critical positions within an organization and developing an action plan for individuals within that organization to assume those positions (Hirsch, 2000). It is a comprehensive plan that assesses, develops and retains a talent pool of employees in order to ensure a continuity of leadership for all critical positions. It is a process that helps the leadership of a company to identify and capture necessary institutional knowledge that may be lost due to retirement, promotion and general attrition.
A CEO succession is critical and quite difficult; very few boards excel at it. The best indicator of a properly executed CEO succession is his or her impact in the business in the long run. For our bank’s CEO, the following skills shall be critical for success; balance sheet management experience, commercial credit skills, experience working with regulators, technology savvy, marketing and social media knowledge, strategic planning skills, leadership and vision, cultural agility, ability to assess and attract top talent, adaptability and flexibility, a focus on accountability, building a culture of excellence, ahead of the curve on industry trends and a person who knows how to work constructively with a board of directors (Anterasian, Stark and Smith, 2016).
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The above knowledge, skills and abilities shall be selected from high potential employees and shall also be acquired through training. Preparing the potential employee to progress in the company requires a combination of formal training, thoughtful coaching, trusted mentorship and key assignments. Career development is part of our organization’s regular human resource practices (Hirsch, 2000). It mainly focuses on closing the gaps and strengthening existing skills and competencies. The managers or supervisors will play a key role in assessing the potential candidate and providing honest feedback along the way.
To ensure that the selected successor does not leave the firm we shall maintain an open line of communication about the succession process and general timeline. This shall be done by creating opportunities for the successor to meet with the board and discuss either formally or informally about the development plans for the company. This kind of safe environment will build a strong relationship and make the successor feel free and comfortable to share his ideas or plans for the company (Hirsch, 2000). We shall also ensure to appreciate the impact the successor has had so far on the company in order to make him or her feel valued.
To be successful, we shall start the succession plan early and shall review it regularly; this is particularly because developing potential internal CEO successors is exceptionally time-consuming. We shall then develop the strategic direction of the business by carrying out an environmental scan, after which we shall identify the knowledge, skills and capabilities that are crucial for the success of the next CEO.
We shall engage an objective third party to assess internal talent and identify potential candidates. We shall the train, coach and mentor the candidates in order to strengthen their existing skills. We shall review the plan and the candidates’ progress regularly. We shall build and maintain trust during the process by being transparent, effective and ensuring all parties understands the process.
After selecting the successor, we shall remain vigilant in order to ensure that the incoming CEO has a clear plan which shall be executed in a disciplined manner. We shall also ensure that the outgoing CEO provides the necessary support for smooth transition.
References
Anterasian, C., Stark, R., Smith, J. (2016). Four Hidden CEO Succession Risks and How
to Avoid Them. Online. Retrieved from http://www.das.ohio.gov/Portals/0/DASDivisions/HumanResources/LPD/pdf/Succession_Planning_Mgrs_Toolkit.pdf
Hirsh, W. (2000). Succession planning demystified . Brighton: Institute for Employment
Studies.
