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Succession Planning: A Process Handbook Part 1

Succession Planning: A Process Handbook Part 1

First revision: Aug.01, 2018
Last revision: Nov.19, 2018

Succession Planning
A Process Handbook
By CHRIS DEROSE AND NOEL TICHY
WITH DON PRYZGODSKY
Succession Planning Introduction

This handbook will help you design your organization's succession planning process. Throughout this book, there has been repeated emphasis that identifying, developing, and selecting top talent is never solely a technical process. Human emotions, personal relationships, and organization norms all play important parts. A well-designed succession process address such political and cultural realities but must be based on a systemic approach for appraisal and development planning for leaders at all levels.
Ultimately, succession planning will be successful only if it is embraced by the leadership as an essential element of an organization's future success. Transitioning to a companywide succession planning platform requires the cooperation and support of every business leader in an organization.
Additionally, individual and team activities must be carefully orchestrated so that data can be aggregated and assessments reviewed with the appropriate checks and balances. This requires calendar alignment across multiple divisions or work units.
This workbook will walk you through steps that serve as a launching point for building a world-class succession process. Although the focus is on the technical process as the foundation, additional discussion of managing political and cultural aspects is provided at the end.

ROLES AND RESPONSIBILITIES

Effective succession planning begins with a close partnership between line operators and human resources. HR is a frequent target of criticism in many organizations-and often deservedly so given the transactional, administrative nature of many HR departments. For succession planning to work, HR leaders must be capable, trusted partners. Succession appraisals and talent planning should incorporate operators' assessments coupled with an HR partners' appropriate challenges, reflective prompting, and supplemental data. Assessment used for succession planning should provide a composite picture based on multiple information sources and varied perspectives. Operators are an important source of such data, while HR should safeguard the overall process, ensuring that no single data point or individual opinion unduly biases the final judgment.
Working in tandem with their HR partner, each business unit head, and head of each corporate staff function, should be responsible for conducting succession planning with their own business units or functions using a standardized process. In this handbook, we will focus on planning from the perspective of a business unit leader, but the process outlined can easily be adapted to any department or team leader.

A STANDARDIZED PROCESS

Succession planning and talent reviews should be integrated with other mission-critical organizational tasks such as development of strategy, operating plans, and budgets. It is important that every unit operate on the same annual calendar of events so that data can be compared across units or teams. The optimal succession process should help to identify talent that can be moved across units, helping to ensure broader development and better preparation for senior leadership roles while concurrently focusing top talent on a business's key priorities.
The calendar will be different for each organization, and may be affected by an industry's seasonlity, shareholder reporting schedule, board of directors schedule, or other factors. A sample time line is provided below. The remainder of the handbook will detail the information required and the assessment process to put such a calendar into action.

Table 1: Sample Calendar of Annual Succession Events

Month	Activity	Who's Involved
Early September	Official launch meeting with CEO, business unit (BU) heads, and HR leaders from each business unit. Succession planning begins with dialogue of key strategic initiatives for the following year and talent requirements for achieving operational goals.	CEO, business unit heads, Corporate function heads, HR leaders. Preparation work is likely to involve senior teams in each of the business units.
Mid-September	Each business unit head reports back to his/her direct reports and trains them to deliver the succession plan.	Business unit heads, direct reports from each business unit, HR leaders.
Early October	BU heads create preliminary candidate slate for their busines unit, identifying 3 candidates for each top job and proposing at least 2 candidates for their role.	Business unit heads, HR partner. Business unit head may also seek advice/input from corporate HR leader.
Early October	360-degree feedback surveys of all employees on the candidates slate are completed.	Process run by HR; all salaried staff involved.
Mid-October	Business unit heads and direct reports conduct employee evaluations and complete nine-cells on each of their direct reports.	Business unit head, direct reports, HR leaders.
Mid-October	Candidate slate, employee evaluations, and 360-degree surveys are complied into one document and reviewed by the BU head.	HR team, business unit head.
Late-October	BU heads follow up with direct reports if they have questions concerning their employee evaluations.	Business unit head, direct reports.
Late October	Succession planning binder for each business unit is finalized by the BU head and HR leader.	Business unit head, HR leader.
November-December	Succession review sessions. The chairman/CEO will meet with each business unit separately. The meeting will be a dialogue between the chairman/CEO and HR leader. Your meeting date will be scheduled directly by the chairman/CEO's office.	CEO, business unit head, corporate HR leader, business unit HR leader.

PREPARATION
To implement a standardized process across an organization, particularly a multiunit business, preparation at every stage is critical. As units prepare, it is imperative that they remember succession planning should be in the long-term service of their organization's mission, vision, and operational objectives. The immediate goal of succession is to ensure continuity by matching talent to strategic priorities. No succesion discussions should occur without candid dialogue about the organization's current strengths and weaknesses, and expectations about what will be required of leaders to win in the marketplace in the future.
For this reason, succesion dialogues between the CEO and business unit head begin with a review of the unit's current performance and structure, along with an honest review of performance gaps and how these may relate to leadership talent or skill gaps in the unit. Once the context has been set for where the organization is and what will be needed in the future, only then does the discussion of individuals proceed.
In short, talent assessment, staffing, and development rotations can only be determined in the context of the organizational structure and objectives. Since we are ardent believers that form follows function, and structure therefore must be determined after strategy, the dialogue regarding talent should derive from a shared vision about what will be required of the unit and overall organization to succeed. Armed with this agreement, leaders can discuss the relative merits of each candidate for current needs but, equally important, replace incumbent leaders as they retire or move to other posts.
The discussion of each succession candidate begins with assessment based on that individual's performance and behaviors in his or her current role. Key questions include how the leader has fared in delivering his or her objectives and how well he or she has demonstrated the desired organizational values through his or her behaviors. (Although not the focus of this discussion, it should be noted that a clear and effective goal setting process is an abolsute requirement od assessment and succession planning).

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