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Where do you want your company to be in three years? Most of my successful construction clients have a pretty clear answer to that question. They understand that, big or small, to ensure long-term profitability you need to address who will replace whom and to map out the path each individual will need to take to realize both individual and organizational success.
A well-designed talent strategy defines the critical moves you will need to make and develops a timeline for individuals to develop skills and gain experience to move forward. Understanding the succession planning process is the first step. Building confidence among stakeholders that you are indeed promoting the most qualified candidates is the next. As Winston Churchill advised, "Let our advance worrying become advance thinking and planning."
What is succession planning and who needs it?
Many people use the terms replacement planning and succession planning synonymously, but the two differ. Convincing decision makers to have a disaster replacement plan in the event that key individuals die or depart unexpectedly is not too difficult; persuading them to prepare people for advancement years ahead of their actual promotions presents more challenges. Therefore, replacement planning is a start but only a start. and performance. A course of action for identifying talent throughout the organization, it involves the selection of talented employees to replace key managers who will leave the
True succession planning requires a balanced evaluation of talent, potential, experience, company because of personal preference, retirement, reassignment, or termination. Here is my own definition of succession planning:
Succession planning is a deliberate, systematic effort to guarantee leadership continuity, a process for ensuring a suitable supply of candidates for current and future key jobs so that the careers of individuals can be managed to optimize both the organization's needs and the individual's aspirations.
A powerful way to maximize human capital both now and in the future, succession planning creates an ongoing, continuous plan to focus attention on talent. It establishes a way to meet the organization's needs for top performance over a long period of time, starting with the sometimes daunting plan to advance someone to the number one position, the Chief Executive Officer.
How do you really know if your current processes sufficiently address your succession planning issues? Ask yourself the following:
• Do managers complain that no one is ready when vacancies open up?
• Are expenses for external searches increasing?
• Will you compromise your strategy because you don't have the talent to support it?
• Are possible successors for key positions leaving because they perceive no room for advancement?
A "yes" answer to any one of these questions implies that your company has not adequately established or communicated its plans for the future of its people, both for replacing people in key roles and for developing high potentials for advancement.
How do You Get Started?
When is the right time to start succession planning? Now! If you start five or even ten years before the estimated departure of key leaders, it may be too late. Unforeseen circumstances can interfere with your best-laid plans, and the company will be faced, not with the quiet crisis of succession, but with a screaming one. Whatever your current situation, these steps describe how you can start a strategic succession plan:
1. Clarify expectations. What does the current CEO expect from each level of the organization? No initiative has a hope of succeeding if the CEO doesn't support it and require commitment to it.
2. Review the current succession plan for the organization. Audit its architecture to reveal vulnerabilities. Determine if this leadership pipeline supports your mission, vision, and values of the organization. Analyze the one, three, and five-year strategies, and evaluate these strategic objectives vis-à-vis the current pool of talent.
3. Based on this information, forecast future talent needs. Examine current versus required performance, existing enhancement initiatives, projected turnover, anticipated retirements, talent growth projection, demographics, and changing business trends.
4. Working together, the members of the leadership team establish competencies for each key position.
5. Identify excellence markers and critical success factors for each position on the leadership team. Ask yourselves "what are the skills, experience, knowledge, and personality characteristics required for exemplary performance?" Competency models can be created for each job or each level in the organization, but there should be some commonality at the upper echelons of the company. In general, you will want to address decision-making and problem solving, results orientation, leadership abilities, and people skills. For as many roles as possible, identify different levels of achievement and the criteria for moving from one level of achievement to the next. Start with your most important roles and scrutinize your top performers. Build a talent profile that encapsulates the best practices of these achievers. Any leadership pipeline demands a continuous flow of talent, so extend succession planning throughout the various levels of the organization. In other words, establish a systematic method for moving from the bottom to the top.
6. Next, as a team, agree on standards for high-potentials. Some organizations concentrate on the top 5% of their population. The criteria for determining a high-potential would include the following:
• The ability to advance two job levels in five years
• A willingness to relocate or acquire requisite field experience
• The potential for at least 10-15 years with the organization
7. Identify the strengths and weaknesses for each individual you are considering for key positions. Assess "ready now" people, identify a timeline for "ready now" in the future, and examine each high-potential vis-à-vis this list.
8. Ask each member of the leadership team to identify high-potentials currently in the organization and one or two possible successors for each key position in the pipeline. For immediate decisions compare this list of high potential candidates with the list of "ready now" candidates, or look at the timeline for projected readiness to determine when they will be able to take on new responsibilities.
9. Finally, assign members of the leadership team accountability for development plans for each high-potential.
Leadership Intelligence
Even though there are other predictors of future leadership success, the most crucial forecaster of success at the top of the organization is brainpower. Three main components define what I call leadership intelligence: critical thinking, learning ability, and quantitative abilities
Dispassionate scrutiny, strategic focus, and analytical reasoning form the foundation of critical thinking. These abilities equip a person to anticipate consequences, to get to the core of complicated issues, and to zero in on the critical few, while putting aside the trivial many. Often successful construction supervisors and project managers possess excellent tactical thinking abilities, or a step-by-step approach to decisions. However, this kind of thinking tends to limit people as they ascend the ladder. Often the complexity of managing multiple projects separates the tactical from the strategic thinker. I have worked with several construction companies that made the mistake of promoting a person to a position that demanded strategic thinking, when the person's true talent lay in a tactical approach.
General learning ability is the second most important aspect of leadership intelligence. When leaders can acquire new information quickly, they do not lose valuable time. Often, but not always, educational success is an accurate predictor of how quickly someone will learn in the organization.
Quantitative abilities are critical at the top of most organizations. These skills allow a person to evaluate the nuances of mergers, acquisitions, and risk-taking ventures. Estimators and risk managers often demonstrate well-developed quantitative abilities, but when it comes to promotions, decision makers too often overlook these gifted contributors in favor of those who have more operational experience:::::