Posts tagged ‘Predictability’

Why most succession plans don’t add any value

At its very core, the problem is that most succession plans are never used. And if not used, it is hardly a controversial to say, that they don’t add value. Many large international companies spend much time and resources on developing a complete success planning program, which intends to identify a person who will take over if the executive is hit by a bus or suddenly leaves the company. I have never actually heard of the famous bus incident so I guess it is for when executives get fired or leave.

There is today very little evidence to support the view that it adds value to have succession plans for top management level, however some case studies and data suggest that this is more valuable for some middle-managers and many specialists. Maybe that’s where the focus should be.

So what to do for the succession plans to add value?

  1. Succession planning works best in organisations where there is little change and a high degree of predictability. No wonder then that the term originates from the military. This is true for some organisations but for most the reality is that they experience so much change, re-organization and lay-offs that succession makes no sense.
  2. The quality of the successors must be very good, which means that a constant gab-analysis and gab-closing exercise must take place. This development project is valid when a successor is needed but wasteful when it is not.
  3. Management must be committed to use the identified successor (which frankly is not the case today, as highlighted in a recent McKinsey study of talent management).

One possible solution to lower cost and improve returns would be to make a Just In Time Succession Plan. When a job is open, find out who is the most suitable and let that person take the role. If any development is needed post hire then spend the money there.

Finally there is the option of asking a executive search company to always have a list of five candidates ready for all of the top management positions and review the list with the search company on a regular basis.

P.S. I would encourage you to read chapter 5 in “Talent on Demand” by Peter Cappelli for more on this subject.

10/11/2011 at 22:45 1 comment

Leadership in bad times – lessons for HR

I was reading a study of group behavior of baboons (which we humans share 99% of our gen-material with). The study was looking into how often the males in the group was looking at the Alpha-Male (the leader) for clues as to how to act. The average was once every 30 seconds. The interesting thing was that in times of major changes in the environment or where there was unrest in the group, the males were looking at the Alpha-Male every 15-20 seconds i.e. much more often.

In times of changes we increasingly look towards our leaders for clues of how to act and understand what is going on. As a manager you cannot not communicate. For example, employees will read a lot more into the cancelation of a Monday-meeting today than for four years ago. When rumors are plentiful employees look towards their immediate manager to try to make sense of these rumors.

Managers must be aware of how to behave in such times and reflect on how their employees can interpret their behavior. Clear communication is so important, but studies show that the oral and written communication is only one part of it – eye contact, body language, word choice, being visible in the office etc. is just as important.

An article in Harvard Business Review in June 2009 titled “How to be a good boss in a bad economy” suggest that you can do four things to overcome this problem: 1) provide predictability. This is about understanding ‘what’ and ‘when’. Studies show that the negative impact of an event is much lower if people is able to predict it. 2) Increase understanding. This is about ‘why’ and ‘how’. People simply react more negatively to unexplained events. 3) Afford control. Employees may not have much control over what is happening, but they may get a say in how and when it happens. 4) Show compassion. Prof. Greenberg from Ohio State University provides evidence that compassion affects the bottom line in tough times. It helps employees retain dignity and make them behave better.

HR can do a lot to help their primary customers – the managers – during bad times. In fact this is when HR is needed the most and is often criticized for not  adding enough value. Certainly many HR people must focus their energy on legal and functional tasks – especially during downsizing – but it is also the time for HR leadership to step up. I am thinking that all four solutions mentioned above are areas which a proactive HR department can go in and add value to the organization. Who better has the overview, capacity and competencies to handles these challenges than HR? Not that employees will ever look towards HR for clues but because HR can help managers become better mangers in bad times.

08/11/2010 at 09:05 2 comments

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