Over the last few years we have seen increasing levels of executive turnover in organizations as the economy continues to recover and more job opportunities become available. This turnover can cause a significant impact on any organization, particularly for small and mid-market companies, and the effects can be severe. According to the American Management Association, less than 20 percent of all organizations are well prepared for the departure of a key executive. Is yours one of them?
Having a solid succession plan in place, developing “bench strength” (your next generation of leaders), and developing and maintaining relationships with external talent acquisition experts are critical to ensuring your company is well-prepared for an unexpected departure. Without addressing these elements, your company can be vulnerable to disruptions in the execution of your strategic plans and damage to client relationships.
To gauge your readiness, ask yourself these questions about your current situation:
- Are you satisfied with your current bench strength and leadership development programs?
- What would you do if your most valuable player gave notice this Friday? Do you have someone immediately available who could step into the role on Monday?
- If you don’t have an immediate replacement, do you know who you could turn to for help? Do they understand your organization and are they capable of producing qualified candidates on short notice?
Succession plans to ensure a smooth transition in the event of the departure of a key member of your leadership team should be created well before the plan is ever needed. Additionally, they should identify the person or resource you will turn to for assistance in filling the vacant position. A few steps to create a solid plan include:
- Escalate the conversation internally if you feel it is not receiving proper attention. Often, board members and key stakeholders are aware of the potential negative impact of a significant departure and are eager to address these risks.
- Identify the skills and personality traits your executive team and other “A” players bring to the table and what would be required should you need to replace them.
- Assess your current bench strength to identify strengths as well as areas for continued development.
- Enlist the help of talent acquisition professionals, both inside your organization and externally, to ensure they have a strong understanding of your needs.
Creating solid succession plans puts your organization in the best possible position to address an unexpected departure, and being prepared well in advance of an actual need will send a clear message to your employees, your competitors, and your customers that you’ve built a strong company with an eye toward long-term success.
Adam Berman can be reached at Email or 215.441.4600.