This article originally appeared in the May 2016 issue of Smart Business Philadelphia magazine.
“Spend some time thinking about the characteristics that make your company strong,” Ridgeway says. “What is your mission statement? Why do clients like working with you? Your focus should be on creating an environment and a mindset that not only embraces new ideas, but encourages them.”
This will put you in a better position to plan for your future and hire the talent your company needs.
“If you walked in today and learned that four executives were leaving the company, what would you do?” Ridgeway says. “Would you have people ready to step up and assume those critical roles on your team? Succession planning is tremendously important for the health of your business.”
If you haven’t thought about your depth of leadership and your company’s ability to replace departing talent, don’t feel bad. Lack of planning is a common misstep for many organizations.
“It’s not easy, but the best leaders always keep succession planning in the back of their minds and create a culture where there is always mentoring taking place,” Ridgeway says.
Smart Business spoke with Ridgeway about the keys to effective succession planning and how to attract ‘A’ players to your team.
Where should you begin with succession planning?
Start with your company’s strategic plan and be clear about where you want it to go. Do you want to grow organically or through acquisition? If you want to grow organically, do you have the right people to take your company to the next level?
With that information in mind, take a look at your departments and start identifying strengths and weaknesses. Are you strong in operations, sales, finance, marketing, etc.?
If you find a weak spot, perhaps you want to invest in somebody who can jump into that role and fill the gap. You want to proactively create a strategy and a plan for how you’ll meet this goal rather than waiting until the last minute to address change.
What if it is the owner or CEO who is stepping down?
When a company embarks on a process to select a new leader at the top, there are two important psychological elements at work. The first is that you, the person who is stepping down, should try to overcome the fear of letting go and work on being able to say, ‘I’m going to turn this over to someone to operate the business and then stay out of the way.’ That’s not easy for an owner to do.
The second is that you should accept that your replacement may make changes you don’t agree with or approach growing the business in a new way. Resist the urge to step in and allow the new leader to chart their own course. This is especially important if your plan is to remain with the company in some capacity.
What are critical elements of conducting a search for a new leader?
It can be very helpful to use an outside firm to conduct the search. An executive recruiter brings an objective, fresh perspective to the process, which can be especially useful as internal candidates come forward who are interested in the opportunity.
In that case, you can say, ‘We’ve hired a professional search firm. They know what we’re looking for and you’re going to be part of the process. But it’s going to start with them.’
Externally, we are seeing more and more that job seekers are looking for opportunities to make a strong impact. Compensation is important, but just as importantly, they want to be part of a dynamic team and make a strong contribution to the company’s growth. And they expect to be compensated for those efforts. So as you go through your search, think about creative methods of compensation beyond the traditional salary and bonus in order to lure top-level talent. ●
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