Every Department Needs a Succession Plan

Succession planning is crucial to ensuring an organization’s ongoing viability. But it’s not just important for companies — it’s also essential for each division and department within. There’s a good chance you won’t have more than two weeks’ notice when a key employee decides to leave for a new job and that’s not enough time to come up with a replacement plan and get someone to fill the newly vacant role.But if you have a succession plan in place, you’ll be developing lower-level employees to step up and you’ll know what steps you need to take as soon as an important employee announces his or her departure. Read on to learn how to develop a plan that will work for your team.CIO Succession Planning Critical as IT Drives Business Growth. CIO: “As technology becomes increasingly woven throughout the fabric of business, it’s incumbent on CIOs to build a deep bench of IT leaders that includes one or more candidates who can step into should they move to a different position or retire….Succession planning may seem like common business sense but it wasn't always a requirement for corporate IT departments, historically tasked to make sure the computers worked. More organizations now look to technology as an engine for business growth and must have a succession plan for the CIO. ‘IT used to just keep the lights on, but now they're using IT to create a competitive advantage,’ John Reed, senior executive director at Robert Half Technology, says. ‘In many organizations today, the IT group sits with the business group and is very involved in strategic decisions.’"Succession Planning: A Vital Part of Business Survival. SkilledUp: “In addition to the pressures that are normal to all businesses, publicly traded companies have the added stresses of shareholder involvement. In most publicly traded companies, the governance committee of the board of directors is in charge of succession. But a poor quarterly earnings report or an unexpected revelation can spur action before the committee is ready. An example of this is Lumber Liquidators, whose CEO abruptly resigned after reports that some its flooring may contain a dangerous amount of formaldehyde. The board had to bring back the retired founder to run the company until a new CEO could be found. There was no succession plan in place. A lack of succession planning can adversely affect an organization in a variety of ways, from the absence of strategic direction to decreased productivity to weakened financial performance. More than one-quarter (27 percent) of companies said they’ve been adversely affected financially by poor succession planning or a lack thereof, according to an article from CareerBuilder.”Succession Plans are Key to Protecting Your Business When the Unthinkable Happens. Miami Herald: “Losing a CEO to an unforeseen circumstance such as a tragedy, termination or resignation can create more turmoil than losing a leader to a situation you can see coming, such as a terminal illness or an orderly, planned change. Sudden losses can leave employees and other key stakeholders devastated and bewildered. Without a designated leader or clear path to the future, the business can suffer. This can be particularly disastrous for smaller companies.While it is not uncommon for people to think their company could never survive the death of the CEO, the fact is that more often than not, it could survive with proper planning. Well strategized, efficiently executed succession plans bring benefits on multiple levels. In addition to providing a roadmap to help your company deal with the crisis, they put investors and shareholders at ease.”Ask These Tough Questions About Succession Planning Before It's Too Late. The Globe and Mail: “Business owners build great wealth by concentrating all their resources into their company. Over time, they will create significant net worth with this single investment. While they are young and in the building phase of their lives, the risk to their future life and to their family security is manageable. Eventually, however, it is inevitable that circumstances will change, and the owner will be forced to look at the options to sell. Obviously, it is better to sell when you are in a strong bargaining position. Getting prepared years ahead of time will make an enormous difference to the price tag for the business, and subsequent wealth. ‘The succession process will involve asking some tough questions and exploring scenarios that may not please all family members, shareholders, or senior managers, but it is necessary and prudent,’ says Larry Klar, partner the Succession Fund, which buys shares in small- and medium-sized businesses.”Business Succession Planning: How to Do It Right. Pozzuolo Rodden: “There are many stakeholders in succession planning, and it is important that each be brought into the process in a timely manner. Instead of the chief executive officer and head of human resources presenting their succession plan to the board once a year, I suggest that the process start by engaging the board in the development of a forward-looking skills-and-experience profile for the CEO. The profile should be a living document refreshed as necessary to take changes in strategy or market conditions into consideration. It should also go beyond the traditional position description and delve deeply into both the competencies and experiences required for the next leader. It can then be translated into a dashboard for grading succession candidates in an objective manner. By engaging the board first in setting the criteria and then in refreshing them each year, you create buy-in and alignment in the eyes of the jury who will select the next leader.”Want to learn more about succession planning? Read our white paper:Success Labs is a leadership development and management consulting firm in Baton Rouge, Louisiana. For more than 25 years, our expert team of consultants has worked with hundreds of companies to explore their business potential and improve their company and cultural performance. Contact us to get proactive about your people strategy.