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Andere Keys to...

BusinessSuccessionPlanning

HelpDeskTool-KitsforBusinessProfessionals

CopyrightNotice

Copyright©2017byAndereCorporation.

Allrightsreserved.Nopartofthispublicationmaybereproduced,distributed,ortransmittedinanyformorbyanymeans,includingphotocopying,recording,orotherelectronicormechanicalmethods,withoutthepriorwrittenpermissionofthepublisher,exceptinthecaseofbriefquotationsembodiedincriticalreviewsandcertainothernon-commercialusespermittedbycopyrightlaw.Permissionrequestsshouldbesubmittedtothepublisherinwritingattheaddressebelow:

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CONTENTS

Preface 5

1 SuccessionPlanningVs.ReplacementPlanning

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2 PreparingforthePlanningProcess 13

3 InitiatingProcess 19

4 TheSWOTAnalysis 27

5 DevelopingtheSuccessionPlan 33

6 ExecutingthePlan 39

7 GainingSupport 45

8 ManagingtheChange 50

9 OvercomingRoadblocks 57

10 ReachingtheEnd 62

Highexpectationsarethekeytoeverything.

SamWalton

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Preface

Thelossofvaluableleadershipcancrippleacompany.Businesssuccessionplanningisessentiallypreparingsuccessorstotakeonvitalleadershiproleswhentheneedarises.

Whetheritispreparingsomeonetotakeoverasthesoleproprietorofasmallbusinessorapositionofleadershipinacorporation,businesssuccessionplanningisessentialtothelong-termsurvivalofacompany.Thisbookwillteachyouthedifferencebetweensuccessionplanningandmerereplacementplanningandhowtopreparepeopletotakeontheresponsibilitiesofleadershipsothatthecompanythrivesinthetransition.

Changeisthelawoflife.Andthosewholookonlytothepastorpresentarecertaintomissthefuture.

JohnF.Kennedy

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ChapterOne:SuccessionPlanningVs.ReplacementPlanning

Successionplanningandreplacementplanningaretwodifferentthings.Replacementplanningisfocusedonidentifyingimmediateunderstudies,whilesuccessionplanningisfocusedondevelopingtalenttomoveforward.

WhatisBusinessSuccessionPlanning?

Successfulsuccessionplanningisrelatedtoleadershipdevelopment.Itdevelopsapooloftalentsothattherearenumerousqualifiedcandidatesthroughouttheorganizationtofillvacanciesinleadership.Successionplanningusedtoconcentrateondevelopingleadershipatthetoplevel,butnowitisbuildingastrongtalentbase,whichhelpstoincreaseemployeeloyaltyandensurethelongevityofthecompany.Thisstrategyrequiresrecruitingqualifiedtalent,creatingatalentpool,andinstillingloyalty.

Benefitsofsuccessionplanning:

• Decreasedturnover

• Increasedemployeesatisfaction

• Improvedcommitmenttocompanygoals

• Enhancedimageoftheorganization

Whatdoessuccessionplanningrequire?

• Identifythelong-termgoalsandobjectivesofthebusiness:Thelong-termgoalsdirectlyrelatetosuccessionplanning.Isthecompany’sgoaltogrowormaintainitscurrentposition?Willitexpandintootherfields?Allofthesequestionsneedtobeaddressedbeforecreatingasuccessionplan.

• Understandthedevelopmentalneedsofthecompanyandidentifyemployeeswhofittheseneeds:Theresponsibilitiesofemployeeschangeovertime.Somepositionsmaybeeliminatedinthefuturewhileotherswillbeadded.

• Recognizetrendsintheworkforceandengageemployeestobuildloyalty:Understandingworkforcetrendswillhelpyoupredicttheneedsofyourorganization.Forexample,areyourkeyemployeesnearingretirement?Haveyouinvestedintalentedemployeestotakeonadditionalroles?

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WhatIsReplacementPlanning?

Replacementplanningworksundertheassumptionthatthestructureoftheorganizationwillnotchange.Thisiseasiertoapplyinsmallfamilybusinessesthatdonothaveanygoalstoexpandorgrowinthefuture.Therearetypicallytwoorthree“replacements”identifiedintheorganizationchart.Eachbackupislistedwithhisorherabilitytoreplaceanexistingleader.Theemployeesarenotnecessarilydevelopedtounderstandthenewworkingenvironmentorsmoothlytransitionintohisorhernewresponsibilities.

DifferencesBetween

Manyexecutivesbelievethattheyareengaginginsuccessionplanning,butinrealitytheyarestillusingreplacementplanning.

TheMainDifferences:

• Replacementplanningfocusesonfindingsuitablereplacementsonlyfortopexecutives.

• Successionplanningmeansthatthecompanyiseasilyabletofillvacanciesthroughoutthebusinessbecauseemployeesarebeingempoweredanddeveloped.

• Thereisashortlistofcandidatesinreplacementplanning.

• Successionplanningbuildsalargetalentpool.

Successionplanningtakesalittlemoretimeandeffortfromthoseinleadership,butityieldsahighreturnonsuchaninvestment.

DecidingWhatYouNeed

Thereareseveraldifferentfactorsthatindicatewhenacompanyneedstoimplementorre-evaluatesuccessionplanning.

• Turnoverbecomescritical:Thenumberofhigh-potentialworkersleavingishigherthanaverageworkersleaving.(Thiscanhappeninanyeconomy.)

• Employeesfeelundervalued:Whenamajorityofyouremployeesfeelthatthereisnoroomforadvancementorthatyouchoosetoomanyoutsidehires,thereisasuccession-planningproblem.

• Therearenoreplacementsforkeytalent:Shouldavaluedmemberofstaffsuddenlyleave,thereisnooneabletotakehisorherplace.

• Managersnoticethattherearenotmanycandidatesforpromotion:Employeeswhoarenotdevelopedforleadershipwillneverbepromoted.

• Thetimetofillmetricishighorunknown:Thetimetofillmetricistheaveragelengthoftimethatittakestofillaposition.Ahighnumbermeansthatthecompanyneedstofocusonsuccessionplanning.

• Theretentionriskanalysisishigh:Ariskanalysisusesdifferentfactorstodeterminethepotentialnumberofemployeeswhowillleave.Thesewillfactorinretirementandothertrends.

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PracticalIllustration

Jacobhadtoplanforthescenariothattheremaybeavacancywithinthecompany.First,heinspectedtheactualrequirementsofthecompany.Afterseeingrecordbreakingsalesandprofit,itwassafetoassumetheyshouldexpand.Thiscalledforhisplantobeoneofsuccessionratherthanreplacement.Giventhecurrenttalentbasehehadtoworkwith,heknewthatthereweremanyemployeeswhorequiredonlyalittletraininginordertobecomethenextsuccessfulleadersofthecompanyontheoccasionofavacancy.

Agoalwithoutaplanisjustawish.

AntoinedeSaint-Exupery

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ChapterTwo:PreparingforthePlanningProcess

Implementinganynewprocessrequiresplanning.Likeanyotherbusinessplan,successionplanningrequirestakingahardlookatthebusinesstoidentifyitsneedsandopportunities.Deviseparameterswithinlegalandoperationalparameters.Createaplanthatfitswiththecompany’slong-termgoalsandevaluatetheplanasneeded.

HowtoSetParametersforthePlanningProcess

Beforecreatingasuccessionplan,itisessentialtosettheparametersfortheprocess.Theparametersincludeguidelines,rolesofemployees,anddifferentapproachestoimplementingtheplan.

CommonParametersinclude:

• Recognizelegalobligations:Considermethodsthatincreasediversityandprotecttherightsofindividuals.

• Identifyguidelines:Guidelinesforpoliciesandprocedures,actionplans,andidentifyingtargetgroupsareessentialtosuccess.

• Detectkeyroles:Thesearerolespeopletakeonthataredifficulttoreplace.

• Determinemethodsforhiringandretainingemployees:Thisisparticularlyimportantinkeypositions.

• Forecastfutureneeds:Remembertobeawareofchangestokeyrequirementsinthefuture.

• Createactionplans:Developthenecessarystepsforindividualactionplans.

Theparametersforeachcompanywillvaryslightly,butthelistaboveisausefulstartingpoint.

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ShouldYouEstablishaCommittee?

Thesizeoftheorganizationwilldeterminetheeffectivenessofacommittee.Smallsoleproprietorshipsmayfindittoocomplicated,butorganizationswithmorethan20employeescouldbenefitfromacommittee.

Theresponsibilitiesofacommittee:

• Identifyimportantsuccessionplanningissues.

• Outlinethesuccessionplanningprocess.

• Managetheplanningprocess.

• WorkwithHRandotherteams.

• Developspecificstrategies.

• Evaluateprogressandmakenecessaryadjustments.

Onceyouhavelaidouttheparametersforthesuccessionplan,establishyourcommittee.Creatingacommitteeis,inaway,atypeofsuccessionplanningbecauseitgivesyourvaluableemployeesroomtogrowanddevelop.

HowtoGatherOperationalData

Preparingforthebusinessplanprocessrequiresdata.Gatheringsomedataiseasy,whileotherthingsarealittletricky.Financescanassessproductivity,sales,cost,andlabor.However,thingssuchastrainingandoperationaldatademandabitmorework.

Waystogatherdata:

• QuestionnairesandSurveys:Peoplearemorelikelytoansweranonymousquestionnaireshonestly.

• FinancialReports:Keepingatabonfinancialreportswillshowyoutheeffectivenessofnewpolicies.

• Meetingswithdifferentdepartments:Havedifferentdepartmentsmeettodiscussneedsandopportunities.Createcross-functionalteamsifnecessary.

• Conductat-riskmetrics:Determineemployeetrends.

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PracticalIllustration

Kerrywantedtobeabletomakeplansforthechancethattheremaybeavacancyinthepapercompany'sleadershippositions.Thecompanywasratherlarge,sotheyfounditimportanttogathertogetheracommitteetohelpdecideupontheissues.Thoseissuesincludedthingslikelegalobligations,guidelines,keyrolesthatmightbedifficulttoreplaceandmethodsforhiringandretainingemployees.Inordertogetabetter,moreinformedviewandassessmentofthecurrentsituation,thecommitteehadquestionnairesandstatisticreportsonthecompanymadetogiveabetterview,andthisledtoabettersuccessionplanoverall.

Effectiveleadershelpotherstounderstandthenecessityofchangeandtoacceptacommonvisionofthedesiredoutcome.

JohnKotter

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ChapterThree:InitiatingProcess

Theinitiationprocessisessentialtothesuccessofbusinesssuccessionplanning.Atthisstage,thegoalsandobjectivesareset.Thefirststepofthisprocessistocreateamissionstatementandavisionstatement.Corevaluesofthecompanyneedtobeincorporatedintoanyprocess,includingasuccessionplan.Themissionstatementandvisionstatementwillguidethesuccessionplan,andsteerpeoplewhochoosetobecomementorsintherightdirection.

DevelopaMissionStatement

ConsideringthattheCenterforCreativeLeadershipestimates66percentofoutsidehiresinseniormanagementpositionsmeetwithfailurewithin18months,providingsmoothtransitionsshouldbeanimportantpartofanymissionstatement.

WhatisaMissionStatement?

Amissionstatementisaconcisesentenceorparagraphthatexplainsthecompany’sgoalorpurpose.Forexample,Disney’smissionstatementis,“Tomakepeoplehappy.”Missionstatementsdefinethecompanytoemployeesandconsumers.Shortermissionstatementsareactuallymoredifficulttowrite.Somecompaniesusebulletstohighlightimportantinformation.

HowtoWriteaMissionStatement

Eventhoughitisbrief,missionstatementstaketimetoperfect.Thefirststepistobrainstormwithemployeesanddiscoverwhateveryonedesiresforthecompany.Trytoincludethefollowingstatementswithinyourmissionstatement.

• StatementofPurpose:Thisexploresthepurposeinspirationofthecompany.

• StatementofStrategy:Thestatementexplainshowthebusinessstrategyconnectswithemployeesandcustomers.

• StatementofValue:Thislinksthestrategiesoftheorganizationwiththevaluesofemployeesandconsumers.

• StatementofBehavioralStandards:Employeebehaviorislinkedtothecompany’svaluesinthisstatement.

• StatementofCharacter:Thecultureofthecompanyisoutlinedinthisstatement.

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DevelopaVisionStatement

Visionstatementsaresimilartomissionstatements.Missionstatementsarecenteredonthecurrentsituationandstrategies,whilevisionstatementsconcentrateonthefutureofthecompany.Whatdoesitlooklikewhenthecompanygoalsareachieved?Visionstatementsareoftenusedtoguidemissionstatements.Theyinspirepeoplebasedoncommonvalues.Visionstatementsmaybecreatedforacompany,aproject,orindividuals.

Writingavisionstatement:

• Determinethevaluesofthecompany:Askpeoplehowtheyfeelaboutthefutureoftheorganizationanditsvalues.

• Discoverfuturegoals:Findoutwhatvisionpeoplehaveofthecompanyinthefuture.Attempttocreatespecificfuturegoals.

• Writeandrewrite:Visionstatementsshouldbeabletochange.Onceavisionstatementisdrafted,itcanandshouldbealteredasthemarketchangesandthecompanydevelops.

Visionstatementsfocusonthevaluesoftheorganizationandinspirepeopletoworktogethertowardacommongoal.

ChoosingtoBeaMentor

DeanTerriScanduraoftheUniversityofMiami,reportsthat71percentofFortune500companieshavestrongmentoringprograms.Mentoringisthebestwaytocreatesmoothemployeetransitionsbytransferringknowledgebetweenpeople.Sincetalentpoolsarebroad,anyoneinthecompanycanbecomeamentorandtransferhisorherpassionandvision.Choosingtobecomeamentorhasmanybenefitsforboththementorandprotégé.

Benefitsofbecomingamentor:

• Createnewcontacts:Mentoringanotheremployeewillexposethementortoanewcircleofpeopleanddifferentpointsofview.

• Developleadershipskills:Mentoringteachesusefulleadershipskillsonaninformallevel.

• Learnnewskills:Mentorscanlearnnewandusefulskillsfromtheirprotégés.

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Whoshouldbeamentor?

Successfulmentorshavecertainqualitiesincommon:

• Goodlistener:Mentorsmustbeeffectivecommunicatorswhoareabletoactivelylistentotheirprotégés.

• Sensitivityandempathy:Mentorsshouldbegenuinelyinterestedinthedevelopmentalneedsoftheirprotégésandfindthemosteffectivemethodsofmeetingtheseneeds.

• Committedandconfidential:Mentoringrelationshipsareeffectivewhentrustisestablished.Mentorsmustbecommittedtotherelationshipandkeeptheconfidenceoftheirprotégés.

Mentorsneedtocarefullychoosetheirprotégés.Donotwastetimedevelopingsomeonewhoisnotcommittedtothetask.Characteristicsofsuccessfulprotégés:

• Committedtodevelop:Learningnewskillstakestimeandeffort;theunmotivatedwillbecomeeasilydiscouraged.

• Abletoacceptfeedback:Peoplewhocannotacceptconstructivecriticismwillnotdevelopeasily.

• Eagertotakeonnewchallenges:Partoflearninganddevelopingistakingonnewandexcitingprojects.

Mentoringprogramswillvarybybusinessanddepartment,butallmentoringprogramsbringtogetherqualifiedmentorswithprotégéstocontinuethegrowthanddevelopmentofessentialskills.Togethermentorsandprotégéssetgoalsandworktowardthosegoals.

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PracticalIllustration

Garyrealizedsomethingsaboutthepapercompanythatwerelacking.Hecalledtogetherameetingtodiscussthem.Herevealedthattheyhadnomissionstatement,novisionstatement,notevenamentoringprogram.Alloftheemployeeswereaskedabouttheirviewofthecompany,andhowtheysawthecustomersviewtobe.Theyusedthatinformationtocarefullycraftatopnotchmissionstatement.Theirplansforexpansioninthefuturewereincludedintheirvisionsstatement.Theyusedtheinformationlaidoutintheirsuccessionplananddeterminedthatamentoringprogramwouldbejustthethingtodeveloptheleadershipqualitiesthatmaybecalleduponifthereareanyvacancies.

Buildyourweaknessesuntiltheybecomeyourstrongpoints.

KnuteRockne

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ChapterFour:TheSWOTAnalysis

SWOTstandsforStrengths,Weaknesses,Opportunities,andThreats.SWOTanalyseshavebeenusedsincethe1960’stocreatebusinessstrategiesbasedontheinformationfromtheanalysis.Strengthsandweaknessesareinternalfactors,andopportunitiesandthreatsareexternalfactors.ConductingaSWOTanalysisisanimportantsteptotakebeforecreatinganybusinessplan.ASWOTanalysisshouldbemeasuredagainstcompetitors,andusedtodeterminewhatneedstobeinvolvedinasuccessionplan.

IdentifyingStrengths

Thestrengthsofanorganizationareanyinternalcharacteristicsthatprovideacompetitiveadvantage.Strengthsthatarenoteasilyimitatedormatchedbycompetitorsareknownascorecompetencies.Thestrengthsofanybusinessordepartmentwillvary.

TypicalCompanyStrengths

• Customerloyalty

• Products

• Customerservice

• Financialgains

• Employeeloyalty

• Researchanddevelopment

IdentifyingWeaknesses

Weaknessesarealsointernalcharacteristicsofacompany.Theyshowadvantagesthatcompetitorshaveoveryou.Weaknessesaffectthereputationofthecompanyaswellasitsfinancialhealth.Asinternalcharacteristics,ofanorganization,itispossibletoaddressweaknesses.Itisessentialtoidentifyweaknessesintheorganizationandfindwaystoturnthemintostrengths.

TypicalWeaknesses:

• Inefficientcustomerservice

• Poorfinances

• Lowqualityproductsorservices

• Highemployeeturnover

• Disloyalcustomers

• Badrelationshipswithvendors

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IdentifyingOpportunities

Opportunitiesarenotinternal.Externalfactorsaccountfortheopportunitiesthatanycompanyhas.Whileopportunitiesarenotunderthecontroloftheorganization,theseenvironmentalfactorsneedtobeevaluatedandactedonquickly.Rememberthattheopportunitiesthatyourcompanyhaveareopportunitiesforyourcompetitorsaswell.

TypicalOpportunities:

• Growingmarkets

• Advancementintechnology

• Economicstability

• Demographicchanges

• Mergers

IdentifyingThreats

Threatsareexternalfactorsthatinfluenceyourcompany.Theycankeepyoufromreachingyourgoalsandneedtobeaddressedinthecompany’sstrategicplan.Negativeenvironmentalfactorsneedtobeaddressedsothattheirimpactisminimized.

TypicalThreats

• Pricewars

• Buyersmarkets

• Newcompetitors

• Demographicchanges

• Advancementintechnology(makesyourproductobsolete)

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PracticalIllustration

JennyneededtoperformaSWOTanalysisonapaperdistributioncompany.Thismeantthatsheneededtolistthestrengths,weaknesses,opportunities,andthreatsthatmayaffectthecompanyasawhole.Someofthestrengthsweretheloyalcustomerstheyhadthatcamebacktimeandtimeagain.Someweaknessesincludedthefactthattheyhadapoorrelationshipwiththeirvendors.Theyhadopportunitiesintheformofadvancingtechnologiesthattranslatedintoincreasedprofits,andtheywerethreatenedbytheriseincompetition.Havingallofthisinformationopenandavailablehelpedmakethecompanymoreself-aware,andthusbetterabletoplanforthefuture.

Hewhofailstoplan,planstofail.

Proverb

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ChapterFive:DevelopingtheSuccessionPlan

Onceyouhaveagraspofyourbusinessandknowthedirectionyouwanttotake,itistimetodevelopasuccessionplan.Todothisdetermineyourpriorities,usetheprioritiestosetgoalsandobjectives,anddevelopastrategytoachievethesegoals.Whenthisprocessiscompletebegindraftingthesuccessionplanthatfitsyourneeds.

PrioritizeWhattheSuccessionPlanWillAddress

Theprioritiesofeachcompanywillbeunique.Doyouneedtofocusontrainingpeopleforexecutivemanagementpositions?Whatarethestrengthsyouwishtoachieve?UsetheSWOTanalysistohelpguideyou.

CommonBusinessPriorities:

• Profitincrease

• Customerservice

• Employeeloyalty

• Inventorycontrol

• Customerloyalty

Clearlydefiningthecompany’sprioritieswilldecidewhattypeofknowledgetransferwillbecoveredinthesuccessionplan.

SetGoalsandObjectives

Successforanyplanrequiresspecificgoalsandobjectives.Goalsandobjectivesgivemotivationandasenseofdirection.ThegoalsandobjectivesofanybusinessstrategyneedtobeSMART:

• Specific:Goalsshouldhavespecificinstructions.Forexample,aspecificgoalwouldbeinstructingmentorstomeetwithprotégésonceaweek.

• Measurable:Itshouldbeclearwhengoalsandobjectivesaremet.Forexample,reducingturnoverby10percentisameasurablegoal,ratherthansimplyreducingturnover.

• Attainable:Impossiblegoalsarenotmotivating.Makesurethatgoalsarereasonableandattainablesuchasimprovingsalesbyareasonablepercentage.

• Relevant:Goalsneedtoberelevanttoemployeesandtheirfunctions.Askingsomeoneinproductiontoimprovecustomerserviceinnotveryrelevant.

• Timely:Goalsneedspecifictimeframes.Forexample,askthatturnoverdropfivepercentinsixmonths.

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DevelopaStrategyforAchievingGoals

SMARTgoalscannotbeachievedwithouttakingstrategicaction.Thegoalsneedtobedividedintoindividualactions.Aftersettinggoals,itisimportanttowritedownalistofstepstoachievethegoals.Brainstormafewdifferentideasthencritiquethemfortheireffectiveness.Besuretoseekoutfeedbackfromthoseinvolved.

Example:

Goal:Toimproveemployeeloyaltyanddecreaseturnovertwopercentin60days.

Actions:

• Increasetraining

• Matchmentorsandprotégés

• Evaluatingjobdescriptionsandpayscales

• Setclearexpectations

• Communicateconsistently

DraftthePlan

OnceeverythingfromtheSWOTanalysis,goals,andstrategiesisconsidered,theinformationisusedtodrafttheplan.Theplandeterminesspecificstepstakenonaroutinebasistoachievebusinessgoalsandalsothetimelineforreachingthosegoals.Plansmustbereevaluatedfromtimetotimetomeasuretheireffectiveness.Itisimportanttobeflexibleandmonitortheplancarefully.

PlanIncludes:

• Goal/Objective

• Action/Activity

• Dates

• Status

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PracticalIllustration

Erinneededtogatherthecompany'scommitteetogetherforameeting.Shewantedtomakeitagoaltomakeandincreaseincustomerloyalty.Afterabriefdiscussion,theyrealizedtheyneededatimeframeandanactionableplan,sotheydevelopedamorespecificgoal.Intheend,theywantedtoincreasecustomerloyaltybyfivepercentwithinthenextyear.Theydeterminedthatthebestwaytodothatistodevelopandemployeerewardsprogram,whichistheonethingthatgivesthecompetitionanupperhand.Afterlookingatthecosteffectivenessofsomeoptionsforthatplan,theyfoundtheonethatbestfitandwereabletoputitintoaction.Theywereabletoreachtheirgoalduetoproperplanning.

Staycommittedtoyourdecisions,butstayflexibleinyourapproach.

TomRobbins

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ChapterSix:ExecutingthePlan

Executingasuccessfulsuccessionplanrequiresassigningtherolesandresponsibilitiesoftheplanaswellasmonitoringtheprogressoftheplan.Doingsowillhelpguidethesuccessionplaninthefuture.Overtime,thewayinwhichthesuccessionplanisapproachedwillchange.Foranyplantohavelong-termsuccess,itmustbeflexible.

AssignResponsibilityandAuthority

Beforeasuccessionplancanbeexecuted,theresponsibilitiesofthoseinvolvedneedtobeestablished.ThisrequiresidentifyingthepositionsthatwillbedirectlyaffectedandrequiresthesupportofHRandtheseniorleadershipteam.Acommitteeorasmallteamofemployeesmaybechosentooverseetheprocess.Itisimportantthattheskillsofthoseinchargematchthejobdescriptionandthatthegroundrulesareclearlyestablished.

IdentifyingProjectLeaders:

• Personalvaluesalignwithcompanyvalues

• Haveahistoryoffollowingthroughwithprojects

• Havetheappropriatequalifications

• Communicatewell

Thegoalsandobjectivesofeachplanwilldeterminewhattolookforinprojectleaders.Onceleadersarechosen,itisimportanttoestablishaclearchainofcommandandprovidetheteamwithnecessarymaterials,support,andguidance.

EstablishaMonitoringSystem

Onceaplanisimplemented,itneedstobemonitoredtodetermineitseffectiveness.Thecommitteeorgroupoverseeingthesuccessionplanningprocessisresponsibleformonitoringandevaluatingthesystem.Thisshouldbedonecontinuously.Theplanshouldbejudgedbasedonthegoalsandobjectivesoftheplan.Aformalevaluationistypicallydoneevery30days.

Whattoevaluate:

• Howwellwerethegoalsandobjectivesachieved?

• Weretheyachievedinthetimeframeestablished?

• Whatisthefeedbackfromemployees?

• Whatisthefeedbackfromtheleadershipteam?

• Whatarethefinancialgainsorlossesfromthecurrentplan?

Evaluatingthesystemwillprovideusefulinformationandshowthoseinleadershippositionshowandwhenthesystemshouldbealtered.

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IdentifyingPaths

Thecriticalpathsofaprojectdeterminetheorderofeachactivityinthesuccessionplan.Italsoshowsthetimeandresourcesnecessarytocompleteaproject.Itissimilartoarecipe.

BasicPathAnalysis(BakingCookies):

Activity Precededby Time

Measureingredients C 3minutes

Mixingredients A 2minutes

Preheatoven Nothing 1minute

Preparecookiesheet A,B 5minutes

Cooktime B,C,E 20minutes

Apathanalysiswillhelpdeterminewhatchangesneedtooccurinasuccessionplaninordertomakeitmoreeffective.

ChoosingYourFinalApproach

Withthebackgroundandsystemsestablished,itistimetochoosethefinalapproachforthesuccessionplan.Thismeansputtingitalltogether.Thefinalapproachshouldincludeeverythingfromthemissionandvisionstatementstopathsandstrategies.Whenalloftheinformationistogether,therewillbenocontradictionsandthecoursewillbeclear.

WhatisintheFinalPlan?

• MissionStatement

• VisionStatement

• Overview

• SWOT

• Strategy

• LeadershipTeam

• Recommendations

• Conclusions

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PracticalIllustration

KevincalledtogetherameetingoftheHRdepartmentatthepaperdistributionfactorytohelpoverseetheexecutionofanewlyconceivedsuccessionplan.Theywouldhelpevaluatetheplananditsoveralleffectivenessasitprogressedovertime.Thiswastomakesurethatitcouldbechangedwhereappropriate,soitwasfoundedontheprincipleofflexibility.Onetheyhadgatheredtogetheralloftheassortedprecursorsfortheplansuchasthemissionstatementforthecompany,theleadershipteam,andthewholestrategythatwouldbeputintoeffect,theywerereadytosuccessfullyexecutethesuccessionplan.

Noonecanwhistleasymphony.

Ittakesawholeorchestratoplayit.

H.E.Luccock

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ChapterSeven:GainingSupport

Asuccessfulbusinesssuccessionplanrequiresthesupportofalltheemployeesinvolved.Peoplenaturallyresistchange,evenbeneficialchange.Itisimportanttocloselymonitoranynewplansandimmediatelyaddressanyandallemployeeconcerns.Thisistheonlywaytodevelopthesupportthatisnecessaryforasuccessionplantoreachitsfullpotential.

GatheringData

Gatheringdataonceasuccessionplanisinplaceissimilartogatheringdatabeforecreatingorchangingasuccessionplan.Infact,datashouldbegatheredonaregularbasis.Atthisstage,itisimportanttofacilitateopenandhonestcommunicationsothatemployeesfeelfreetosharetheirconcernswiththoseinleadershippositions.

Techniques

• Meetings:Largemeetingsarenotveryeffective,butsmallerintimatemeetingswillprovidemoreinsight.

• Surveys:Employeesurveysareusefulateverystageoftheprocess.Mostpeoplearemorecomfortablewithanonymoussurveys.

• Metrics:Differentkeymetricswillshowtheeffectivenessofthesuccessionplan.

AddressingConcernsandIssues

Leavingconcernsandissuesunaddressedwillleadtogreaterproblemsovertime.Evenissuesthatdonotseemimportantneedtobeaddressedimmediately.Communicationisthekeytoaddressingemployeeconcerns.Practiceactivelisteningtounderstandwhatemployeesaretryingtosaybeforechoosingtheappropriatemethodtoaddresstheissue.

ActiveListening

• Payattention:Givethespeakeryourundividedattentionandmakesurethatyourbodylanguageandcommentsshowthatyouarelistening.

• Repeat:Paraphrasewhatissaidtoavoidanymiscommunication.

• Donotinterrupt:Allowthespeakertofinish,andavoidemotionalresponses.

• Respond:Respondhonestlyandrespectfully.Speaktothesituationandtrytofindamutuallyequitablesolution.

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EvaluatingandAdapting

Gainingsupportforasuccessionplanmeansadaptingitaccordingtoongoingevaluationsofitsprogress.Theabilitytoremainadaptableisessentialtosuccess.Monitoringsystemsshouldalreadybeinplacetodeterminetheeffectivenessofthesuccessionplan.Evaluatingthesuccessoftheplanandtheemployeebuyincanbedoneusingvarioustechniques.

Evaluating:

• Self-reviews:Employeescanevaluatetheirdevelopmentanddemonstratetheeffectivenessofthesuccessionplan.

• Managerreviewsofemployees:Leaderscanreviewtheeffectivenessoftheprogramandemployeebuyin.

• Datagathered:Thedatawillgiveanideaofhowwellthesuccessionplanisworking.

Oncetheevaluationsarecomplete,considerdifferentwaystoadaptthestrategiestofittheneeds.Forexample,addapersonalactionplanorprovidementorswithleadershiptraining.

PracticalIllustration

Jamesknewthatinorderforthenewsuccessionplantobesuccessfulandreachitsfullpotential,itwouldneedthefullsupportoftheemployeesatthepaperdistributioncompany.Inordertogarnertogetherthissupport,Jamesmadeitapointtoregularlysurveyandcollectdatafromtheemployees.Ifsomethingwasgoingwrong,itwouldbeaddressedimmediately.Thisbuilttrustwithinthecompanythatnotonlyweretheirvoicesheard,butthatthecompanywasactiveinthedevelopmentofthenewplan.Overallevaluationswerecarriedoutconcerningtheplanafterithadbeenineffectforsometime.Thiscombinedtheself-viewofemployees,themanager’sreviewsoftheemployeesandthedatathathadbeengathereduptothatpointtodetermineifanysignificantchangeswereneeded.Intheend,theplanwassuccessfulduetoitsabilitytoadapt.

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Ifyoudon’tcreatechange,changewillcreateyou.

Anonymous

ChapterEight:ManagingtheChange

Changeisnevereasy.Implementingoralteringasuccessionplanneedstobedonestrategicallyinordertotransitionsmoothly.Changesthatarenotexplainedormonitoredaremorelikelytofail.Achangemanagementplanandcommunicationplanwillworkwiththesuccessionplanoranyotherplantoencouragethegrowthanddevelopmentofemployeesandthebusiness.

DevelopingaChangeManagementPlan

Achangemanagementplanisabletoclearlylinkthechangeswiththeorganizationalgoalsandcommunicatethepurposeforthechanges.Thiswillhelplowerresistancetothechangestakingplace.Peoplewhounderstandtheprocessaremorelikelytoacceptandmoveforwardwithit.

ThePlan

• Sharegoals:Explainhowthechangeisessentialforachievinglong-termsuccessandreachingthecompany’sgoals.

• Communicate:Shareabouttheunderlyingissuesandrespectdifferentpointsofview.

• Involvepeopleintheprocess:Encourageemployeestotakeownershipinthechangemanagementplan.

• Developstructureandschedules:Explaineachperson’sroles,responsibilities,andexpectationsclearly.

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DevelopingaCommunicationPlan

Becausecommunicationissoimportantinmanagingchange,itneedstobeapriority.Developingacommunicationplanwillhelpfacilitatethechange.Acommunicationplanoutlinesdifferentcommunicationresponsibilitiesincludingtheaudience,projecttopic,date,deliverymechanism,issues,presenter/communicator,source,andresult.

Example

Topic Method Date Presenter Audience

Morale Meeting 10-10

TeamLead ManagementTeam

Sales ConferenceCall

10-12

VPofSales AllSalesEmployees

Evaluation PowerPoint 10-11

CommitteeLead

PlanCommittee

ImplementingthePlans

Developingachangemanagementandcommunicationplaniseasierthanimplementingthem.Fortunately,mostbusinessplanshaveasimilarimplementationprocess.Changemanagementandcommunicationplanshaveclearstepsthathelptomakethetransitionseasierforemployersandemployees.

Steps

• Definethechangeprocess:Theprocessincludesrolesandresponsibilities,procedures,tools,andperformancemeasurements.

• Determinewhatisneeded:Considerandprovidethenecessaryresourcerequirementsandscheduletheimplementation.

• Monitor:Monitorthechangemanagementandcommunicationprocessaccordingtotheperformancemeasurements.

• Evaluateandmodify:Evaluatetheeffectivenessofthechangesandalterthemasneeded

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ProvidingConstructiveCriticism

Beingcriticizedisneverfun.Peopleinpositionsofauthority,however,needtoeffectivelydeliverconstructivecriticism.Feedbackthatisnotdeliveredwellcancausedireresults.Thereareseveralbasiccharacteristicsofconstructivecriticism.

ConstructiveCriticism

• Bespecific:Focusonspecificactions,anddonotbringinpersonalperceptions.

• Addresscontrollableprofessionalissues:Donotbringuppersonalshortcomingsorissuesthattherecipientcannotchange.

• Providecriticismearly:Donotallowproblemstocontinuewithoutaddressingthem.Thisreinforcestheideathatthebehaviorisacceptable.

• Involvetherecipient:Providepeoplewithopportunitiestoaskforfeedback,andinvolvethemintheactionplan.

• Berespectful:Considertheneedsoftherecipientandmakesurethatthetoneandmannerofdeliveryishelpfulandnotcondemning.

EncouragingGrowthandDevelopment

Employeedevelopmentneedstobenurturedandencouraged.Peopleneedtobechallenged,buttheyalsoneedtoknowthattheyareappreciatedforallofthehardworkthattheydo.Companiesthatinvestintheiremployeesarestatisticallymoresuccessfulthancompaniesthatdonot.Encouraginggrowthanddevelopmentisfundamentaltothesuccessofanybusinesssuccessionplan.

Waystoencouragedevelopment:

• Challengeemployees:Givepeopletheopportunitytotakeonnewrolesandresponsibilities.

• Recognizegrowth:Acknowledgetheprogressthatyouremployeesmake.

• Rewarddevelopment:Rewardpeoplefortakingonnewprojectswithraises,educationreimbursement,andlateralpromotions.

• Promoteinternally:Promotefromwithinwheneverpossible.

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PracticalIllustration

Terryneededtohandlethenewtransitionwellsothatitwouldbeasmoothone.Communicationwiththeemployeeswashismainconcern,andsohedevelopedasetplan.Regularmeetingsensuredthateveryonewasclearonthechangesthatweretakingplaceandtheprogressoftheirdevelopment.Feedbackwasgiventothoseneededit.Althoughsomewascriticism,italsowenthandinhandwiththeprogressofthecompanybyencouraginggrowthandchallengingemployeestotakeonnewrolesandresponsibilities,whilealsotakingthetimetorewardtheirdevelopment.Thetransitionwasmademuchsmootherbythisapproachandwentoffwithoutahitch.

Decisionanddeterminationaretheengineerandfiremanofour

traintoopportunityandsuccess.

BurtLawlor

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ChapterNine:OvercomingRoadblocks

Roadblocksaccompanyeveryplan.Itiseasytobecomediscouragedwhenplansbegintounravel,however,minorproblemsaretobeexpectedandnoreasontogiveuponaplanofaction.Successionplansarejustasvulnerabletoroadblocksasanyotherbusinessplan,butanticipatingcommonobstacles,re-evaluatinggoals,andstayingfocusedwillhelpthesuccessionplansucceed.

CommonObstacles

Theobstaclesthatsuccessionplansusuallyfaceareuniquetoeachsituation.Thereare,however,severaldifferentcommonobstaclesthatsuccessionplansface.

Obstacles:

• Lackofsupportfromseniormanagement:AneffectivesuccessionplanrequiresmorethanemployeebuyinandHRoversight.Seniormanagementneedstobecommittedtotheplan’ssuccess.

• Leadersarenotflexible:Plansneedtobealteredforindividualcircumstances.Whenpeopletrytogoforwardwithaplanthatdoesnotmakesense,theplanwillfail.

• Theplanisviewedasoptional:Acompanythathasalargetalentpoolmaybecomecomplacentaboutsuccessionplanning.

• Goalscannotbeachieved:Tryingtodotoomuchtoofastwillleadtofrustrationandfailure.

Onceobstaclesareidentified,alternativestotheobstaclesneedtobechosen.Constantevaluationandre-evaluationofgoalswillhelpovercomeobstacles.

Re-EvaluatingGoals

Businessdynamicschangeandgoalsneedtobere-evaluatedperiodically.Ifgoalsareconsistentlynotachieved,oddsarethattheyaretooaggressive.Re-evaluategoalsaccordingtoSMARTgoalguidelines.Formalevaluationsthatarescheduledareagoodtimetore-evaluateandaltergoals.

Signsthatgoalsneedtobere-evaluated:

• Goalsarenotachieved:Occasionallyfallingshortofreachingagoalistobeexpected,butwhengoalsareconsistentlymissedthegoalsareprobablynotachievable.

• Thecostsofgoalsoutweighthebenefits:Ifemployeesneedtoworkovertimetoachievegoals,thegoalsareprobablynotworthit.

• Thegoalsarecausingstress:Whengoalscauseunnecessarystress,productivitywillsufferovertime.

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• Employeefeedbackshowsthegoalsareachievable:Donotunderestimateemployeefeedback.Ifmostemployeesfeelthatgoalsarenotachievabletheyprobablyaren’t.

FocusingonProgress

Plansareneverperfect.Focusingonminorsetbackswilllowermoraleandcreateasenseoffailure.Ifgoalsareconsistentlyre-evaluatedandadjusted,itwillbeeasytomeasureprogress.Focusingonprogresswillbuildmoraleandshowsuccessionplanningsuccessandfailure.Creatingprogressreportswillhelpmonitortheprogressofthesuccessionplan.Theyaresimilartoevaluations,buttheyconcentrateontheprogressoftheplansbeingimplemented.

ProgressReportsInclude:

• Risks:ASWOTanalysiswillshowtherisks.

• Metrics:Usedatagatheredtocreatemetrics.

• Projectscompleted:Theseareimplementedprojectsrelatedtotheplan.

• Projectscontinuing:Theseareprojectsstillbeingimplemented.

• Projectsbeginning:Theseprojectsarestillintheplanningstage.

Progressreportscanbewrittenoutusingthesameformatasanyotherbusinessreport.

PracticalIllustration

Jimmywasfacedwithaplethoraofproblemswhentryingtoimplementanewplanatthepaperdistributioncompany.Thingslikealackofsupportfromuppermanagement,leadersthatweren'tasflexibleashehadhoped,andevensomeofthegoalswerenotbeingachieved.Hefoundthatbyre-evaluatingthegoalsthatwereoriginallyset,theywereabletodivertresourcestomorevaluablecauseswithinthecompanyandovercometheproblemsthatwerefaced.Evenwhenfacingthefailuretomeetcertaingoals,theyfocusedontheprogressmadebythecompanyunderthenewplanandalltheprojectsthatwerecompleted.

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Successissimple.

Dowhat’sright,therightway,attherighttime.

ArnoldH.Glasgow

ChapterTen:ReachingtheEnd

Successionplanningrequirestimeandeffort.Itisaninvestmentinemployeesandaninvestmentinthelifeofthecompany.Nomatterwhatconditionthebusinessisin,successionplanningcanleadtolong-termsuccess.Success,however,isbasedonthecircumstancesandgoalsofeachcompany.

HowtoKnowWhenYou’veAchievedSuccess

Successisdifferentforeachcompanyandforeachplan.Thegoalsandobjectivesofthesuccessionplanwillhelpdeterminethesuccessofitsimplementation.WhengoalsarecreatedaccordingtotheguidelinesofSMARTgoalsandaremonitored,re-evaluated,andadjusted,attainingthemwillbepossible.

IndicatorsofSuccess:

• Goalsareachieved:Goalsareanimportantindicatorofsuccess.Whenprogressismadetowardsachievingdifferentgoals,itisclearthataplanisonitswaytosuccess.

• Growthdemandsgoalplanstobeadjustedorexpanded:Changesinthecompanyrequirechangesinthebasicgoalsandobjectives.Sometimesthesuccessofaprojectrequirestheplantobeexpanded.

• Successionplanningbecomespartofthecompany’sculture:Successionplanningrequiresthesupportofemployeesateverylevel.Whenitisembracedinthecompanyculture,thereislittleresistancetotheplan,andgoalsbecomeeasiertoachieve.

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Transitioning

Transitioningintoaviablesuccessionplanisnotalwayssimple.Peopleresistchange,butimplementingachangemanagementprogramwillhelpmakethetransitioneasieroneveryone.Carefullyresearchwhatisneededandplanoutthedetailsoftheplan.Createanunderstandablescheduleforthetransitionandmaintainaclearchainofresponsibilityandcommunication.

Remembertoprovideopenlinesofcommunicationduringanytransitiontoalleviateanyemployeeconcernsandpreventcostlymiscommunications.Thesuccessionplanisparticularlyvulnerableduringthetransitionphase.Asmoothtransitionwillfacilitateanychangewithintheorganization,andimprovethechancesforlong-termsuccess.

WrappingitAllUp

Theimpactthatsuccessionplanninghasontheoverallsuccessofthebusinesscannotbeoverstated.ApplyingthelessonsfromthisChapterwillhelpinstillaviablesuccessionplan.Thismeansputtingeverythingtogether.Thedifferenttopicstieintoeachothernaturally,andgatheringdatawillhelpcompletemorethanoneaspectofthesuccessionplan.RefertotheChaptersasneededduringthecompany’stransition.

PracticalIllustration

Billhadimplementedaplanatthepaperdistributioncompanythatwasnearingtheendofitsrun.Therewerebumpsintheroad,buttheplanwasflexibleandsoweretheappointedleadersinvolved.Thetransitioncommitteehaddonetheirjobwell,andcontinuedtheirevaluationsanddatacollectiontotheend,makingminoradjustmentalltheway.Thegoalsoftheplanhadbeenachievedandthegrowthdemandshadbeenexpandedinsomeareas.Billandtherestofthecompanywerepleasedwiththeresults,andwerereadytoimplementthenextplan.

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Successisajourney,notadestination

BenSweetland

ClosingThoughts

• AlbertEinstein:Wecan’tsolveproblemsbyusingthesamekindofthinkingweusedwhenwecreatedthem.

• AbrahamLincoln:Agoalproperlysetishalf-wayreached.

• DavidRockefeller:Successinbusinessrequirestraininganddisciplineandhardwork.Butifyou'renotfrightenedbythesethings,theopportunitiesarejustasgreattodayastheyeverwere.