WHY SUCCESSION PLANS RARELY WORK

In my last blog post (see “How to identify a future leader” posted April 21, 2014) I stated that while many companies have implemented some formalised succession planning processes, most of these didn’t really work, as very few achieve the intended goal of a structured, planned successful handover to a recognised and identified successor. A number of readers have asked me to elaborate on why I believe this is the case, so here are some of the major barriers that I believe can get in the way of successful succession planning both at C-level and also with succession at lower management levels.

via Wikimedia Commons

via Wikimedia Commons


CEO LEVEL

– Boards are generally not good at picking a CEO … I see that many Boards tend to promote and hire in their own image, which is generally by its own nature outdated, and tend to protect the status quo while believing they are driving change. This is also one of the reasons why there are few women in senior CEO roles. Whilst I am not an advocate of quotas for gender equality, I do believe in the need for a level playing field for all.

– There is a belief that if a CEO has done it before s/he can do it again … I believe that if a CEO has done it once before then s/he has proved that they can do it once, so far. I am amazed at the C-level musical chairs played by some very average executives who just keep moving from one company to another, avoiding serious testing. Business conditions change almost daily with shifts in market conditions, technology, go-to-market, competition and regulations, so what someone did yesterday will most likely not work today. A good known internal candidate will generally be a much better bet than an outsider who looks as though he may have “done it before”.

– Horses for courses … Bringing in a “hatchet man” to slash-and-burn and to right-size a company that is struggling, and that has lost its mojo, means finding someone with a particular set of skills in being able to drive a turnaround of an ailing business. However, we should not believe that a turnaround CEO will have the same set of skills that will be needed in a CEO to lead the healing and growth phase. A blood-letter will very rarely be able to morph into a healer. When a board brings in a turnaround CEO, they should identify and start preparing his successor on day one.

By user 4C; CC BY-SA 2.5 license; via Wikimedia Commons

By user 4C; CC BY-SA 2.5 license; via Wikimedia Commons


– The step up to a CEO role from the level below is a massive one … The single-step promotion from Director to a senior VP level is generally not an enormous step, usually involving more of the same but larger, or more of the same but geographically wider. However, the single-step upwards from a VP role to CEO is enormous, and to believe that it can be done without serious preparation is folly. For a starter, the CEO needs to be able to work with a board, large investors, shareholders, the media and financial and industry analysts which all need a new set of skills, together with an even greater focus on culture, values, strategy and flow down execution than in previous lower roles. In some companies the COO, or the occasional brilliant CFO, may find the step up to CEO as being relatively straight forward, but it is a rare Regional or Divisional President who can take this step without serious preparation.

AT OTHER MANAGEMENT LEVELS

– Who should choose the successor … Generally the manager that the successor will report to will choose the person that he wants in his team. The problem is that in most companies the succession planning process puts that responsibility on selection on the person to be replaced. I have seen too many instances where these selections are not in accord, which is one major reason that analysts believe that only about 30% of promotions are as per the agreed succession plans.

– Sink or swim approach … Very few candidates are bloodied beforehand. I believe that candidates for promotion must be well mentored long term before promotion, and should be developed, grown and tested with a number of challenging assignments that are broader and more complex than their current role, and that carry elements of any potential future role.

Author: 29cm; CC BY-SA 2.0 license; via Wikimedia Commons

Author: 29cm; CC BY-SA 2.0 license; via Wikimedia Commons


– Most companies develop people for the role they are in … I have no issue with developing the skills of people in a way that ensures that they get better at what they do. The problem is that in most companies training budgets tend to be limited, and few companies allocate the funds needed to train and develop for the future rather than just for the now.

– People are pushed into management … I have come across a large number of companies, particularly in the Tech sector, where people are “pushed” into management roles because of the absence of a valid dual career path that allows individual contributors to grow in value, influence, recognition and reward. When vertical growth is the only option, good people will feel they have no choice but to start climbing despite this not being at what they can excel.

– Talent should be built for the organisation … Succession and hi-potential plans are generally built vertically rather than cross silo, and successful succession planning must work across all boundaries. Decisions on promotions and external recruitment into senior roles needs to be cross-divisional and decisions should be taken inter-departmentally. This would also ensure that promotions came to people who had already proven skills in building cross-silo trust, relationships and co-operation, which are mandatory skills needed in successful senior management.

It is critical to remember that the search, recognition and development of talent for an organisation are critical elements of success. Recognising potential in people is an important skill of any leader and there is little to be gained from unrealised potential.

Author: Chrisrobertsantieau; via Wikimedia Commons

Author: Chrisrobertsantieau; via Wikimedia Commons


HOW TO IDENTIFY A FUTURE LEADER

“In the C-suite, the need to develop and implement a plan for leadership succession is one of the most frequently discussed topics. Yet the overwhelming majority of companies have done little about it.”
Wayne F. Cascio

I have found that most companies today have actually implemented some form of succession planning process, and yet I have found very few which have one that actually achieves what one would expect, being an easy, well-structured handover to a planned, ready successor. Many companies treat succession planning as a “tick-in-the-box-done-that-so-it’s-out-of-the-way” chore for management, and the vast majority of organisations will still tend to go outside to fill vacancies for senior level appointments. The excuse is that the organisation will benefit from “new blood” and hence new ideas.

Author: Purple Slog; CC BY 2.0 license; via Wikimedia Commons

Author: Purple Slog; CC BY 2.0 license; via Wikimedia Commons


I have always believed that an internal candidate who has been mentored, developed and prepared, and who may be only a 70%-fit for the role, and who has already proven loyalty, skill, attitude, commitment and success within the company is a seriously better bet to deliver what the company needs than an outsider who may initially look like a 90%-fit on paper.

But it is not easy to recognise the skills, characteristics and personal assets that are needed for leadership, and many companies still make the mistake in believing that it is always the most successful individual contributor who will make the best manager. This means that the most successful salesman is made a sales manager, in the same way that the promotion will go to the largest fee-earning consultant or the most creative product design engineer, often with disastrous results.

This is as true for C-level succession as it is for succession and promotion at lower levels.

Here are ten key characteristics of potential leadership capability that I have tended to look for in internal candidates for possible promotion at any and all levels, and that I believe give at least some basis for recognising future leaders.

They are passionate about the company and what it does … The vast majority of workers see their company as being in a symbiotic relationship with them of work for reward, but there are some who are thrilled to be part of an organisation that ticks all their boxes, and excites them to the point of passion. I have always believed that this “infectious passion” is a key element of true leadership.

Author: Barry Langdon-Lassagne; CC BY 3.0 license; via Wikimedia Commons


People listen to them and follow their lead … Leaders accumulate followers without needing the position title. People will learn from them and emulate their actions and attitudes, because they know what they are doing, are successful and are inclusive, irrespective of what is written on their business card.

They solve problems … Leaders look for a way to solve problems that get in the way of achieving their own and team goals (see “Managers solve problems” posted March 13, 2013). People who can build solutions to barriers that get in the way of team success are a rare commodity and should be cherished and nurtured.

They love what they do … Great people put massive energy into doing what is needed of them and focus on doing their job well. This doesn’t mean that they have nothing outside of work, as true leaders have well-balanced lives and interests, but it does mean that they will also, when needed, be prepared to give up personal time if there is a critical issue that needs resolution.

They mentor, help, advise and encourage younger team members … Mentoring, advising, teaching and guiding younger and/or newer team members, without being asked to do so, and as a natural extension of their time and efforts, is one of the key indicators of a potential future leader. It doesn’t need a formal HR driven mentoring programme to be able to identify those who do it willingly and as a matter of course.

Author: Mamunjoy; CC BY 3.0 license; via Wikimedia Commons

Author: Mamunjoy; CC BY 3.0 license; via Wikimedia Commons


They drive change … Most people who appear to do well do so by protecting “the company way”, as this is one of the easiest ways to please management. True leaders drive change, and if you have no-one in your team who questions the status quo it is unlikely that you have a worthwhile successor, or that you will change quickly enough to address an ever changing business environment. ”A person who does not worry about the future will soon have worries about the present.” Ancient Chinese proverb.

They will stand up to you … Management takes courage in many different ways (see “The art of managerial courage” posted March 3, 2014) and those you view as potential future leaders need to be prepared to stand up and fight for what they believe in, even if it means going up against their boss or the herd. You must allow people with divergent ideas to have a forum to be heard, even if they do not always get their way, but the attitude of “my way or the highway” won’t work.

They can build co-operation … Good leaders know how to build co-operation and get consensus to ensure that everyone needed is involved and committed. One of my key criteria for promotion is to look for people who can attract support readily from those around them. Great salesmen may be those that can do it all on their own, but great sales managers are those that have shown that the pre-sales and support people were always ready to jump to their side in a sales campaign.

They get things done … there are those who can look good and who can “talk the talk” (empty suits) but you need to look out for, nurture and develop those who show a skill for getting things done, who meet their deadlines and who can make things happen.

They don’t play games … Understanding how to get around office politics is a key skillset for anyone in a company (see “A dummy’s guide to office politics” posted May 6, 2013), but those who love to play office politics should be weeded out. Game players who try and get ahead through intrigues are destructive and will drive out good people. Weak managers will promote politicians; great managers get rid of them.

“In the end, all business operations can be reduced to three words: people, product and profits. Unless you’ve got a good team, you can’t do much with the other two.”
American businessman Lee Iacocca

Author: Ralph Alswang; via Wikimedia Commons

Author: Ralph Alswang; via Wikimedia Commons


WHEN YOU KNOW IT IS TIME TO CHANGE YOUR BOSS

“Kill my boss ? Do I dare live out the American dream ?”
American actor and writer Dan Castellaneta

Every boss has their own style and their own set of strengths and weaknesses. It is rare to actually find a boss who is perfect and maybe the best that we can hope for is to find a boss who gives us enough direction to know what is expected of us, and enough freedom to enjoy doing it.

Author: ThisIsRobsLife (own work); CC BY-SA 3.0 license; via Wikimedia Commons

Author: ThisIsRobsLife (own work); CC BY-SA 3.0 license; via Wikimedia Commons


However, there are some bosses whose weaknesses far outweigh their skills, and who will thus have a detrimental effect on your own career development and prospects, and who will remove any of the joy of being at work.

Here are some “boss types” that you should avoid, and if necessary to move on from … or as Winston Churchill would have said “from whom you should move.” Having just 1 or 2 of these characteristics may be acceptable in most bosses, but having many more suggests that your boss is probably out of his depth, and the sooner you get away from them the better it will be for your own quality of work/life.

Business is war … “The art of war” is an interesting enough book to read and has some valid snippets of advice for managers, but the boss who totally sees “business as war” is as outdated as black and white television. (see “Sun Tzu would go broke today” posted October 3, 2011). Business today is based on a complex web of alliances that go beyond the idea that business success is just based on killing all who oppose you.

Author: FrankWilliams at en.wikipedia; PD-ART permission; via Wikimedia Commons

Author: FrankWilliams at en.wikipedia; PD-ART permission; via Wikimedia Commons


The one minute manager … life is complex, the management of people is even more so, and your boss needs to be smart enough, sophisticated enough and experienced enough to be able to handle the vagaries and subtle nuances of business, and the immense complexities of people. A boss who believes that he can learn enough from reading simplistic views of business life is not smart enough to survive.

The emperor … Some bosses believe that they can never be seen to be wrong and will therefore not brook any disagreement. The boss who believes he is always right, and who will not listen to anyone else, is unlikely to drive innovation and creativity in his team. A capable manager will try and find people who are even smarter than is s/he, and will then show that they have a right to lead by listening to the opinions of his people.

Never their problem … Some managers have an ability to let responsibility for tough issues go right past them “to the keeper” (“to the backstop” for my American readers). No matter what goes wrong, it is never their responsibility and they can always find someone to “blame and shame”. A capable manager understands that if it happens on their watch, and in their team, it is always their responsibility.

Author: Stephen Turner at en.wikipedia; GFDL CC BY-SA 3.0 license; via Wikimedia Commons

Author: Stephen Turner at en.wikipedia; GFDL CC BY-SA 3.0 license; via Wikimedia Commons


No feedback … Good managers give their people constant and timely feedback. It is impossible to work for a boss who doesn’t let you know how you are doing on an ongoing basis (both good and bad). Waiting till the end of the year to find out how you have performed from a historical perspective does little in managing behaviour, and doesn’t allow people to adjust what they are doing to be acceptable.

Captain chaos … Some managers have the uncanny skill of being able to create an incredibly chaotic environment around them. I have even come across managers who will deliberately create crises, which they can then solve, as a way of proving their worth. While flexibility in a work environment is a critical catalyst for creativity, perpetual chaos is totally destructive.

The meeting organiser … I have generally found that the number of meetings and conference calls that a manager arranges is in direct inverse proportion to their skills as an executive (see “Meetings bloody meetings” posted April 18, 2011). The premise is that you have meetings to keep people informed, and to involve them in the decision process, but the reality is that managers who call meetings all the time are just trying to cover themselves in case things go wrong. Managers are paid to make decisions and take calculated risks. Most meetings are a waste of time, effort and energy.

Author: Areyn; CC BY-SA 3.0 license; via Wikimedia Commons

Author: Areyn; CC BY-SA 3.0 license; via Wikimedia Commons


The bureaucrat … Bureaucrats achieve little in public sector roles, and achieve even less in the private sector business environment. A manager who “does it by the book” and who lives his life totally by the terms and conditions in the “Policies and Procedures” manual will take too long to move, and today inertia is death. Doing the right thing is always more important than doing the thing right, notwithstanding the need for honesty and integrity at all times.

The politician … I hate business politicians (see “A guide to office politics” posted May 6, 2013), though I do accept that being able to manage upwards is a critical skill needed in a manager. However, managers who love listening to and spreading gossip, who love the political intrigues of a Machiavelli and who believe that “who you know and who you can manipulate” is more important than what you do and what you achieve, should be avoided like rabid dogs.

The body-bagger … Business at any cost, no matter how high is the casualty rate, is not good business and I have never tolerated managers who have been successful but have left a trail of “death and destruction” behind them on their road to achieving their goals. Good managers take everyone along with them, no matter how tough is the hill that they are storming.

To really succeed in life you should find something to do that you can really love doing, and if it means working for a boss, rather than yourself, then you need to find one that you can admire and that gives you the opportunity to stay in love with what you do. If you go through life tolerating a bad manager just because he pays you, or just because he scares you, will ultimately destroy your love of life. Find a better management role model.

NOT ALL MANAGERS ARE CREATED EQUAL

“We are all flawed, but basically effective managers are people whose flaws are not fatal under the circumstances. Maybe the best managers are simply ordinary, healthy people who are not too screwed up”.
Canadian academic and author Henry Mintzberg

I have interviewed, hired and/or rejected, hundreds of managers during my career, from first level young potentials to possible CEOs and Board members, and have realised that no matter how experienced they may initially appear, they can come in many guises, including some that need to be quickly disqualified from consideration for employment, no matter how good they may look on the surface. (see “Why are so many managers so bad at recruiting” posted December 12, 2011).

The problem is that it is never easy to totally and accurately measure how well someone will do in a new management role, no matter how well they have done in previous senior roles, even if there are roles that they have held in the past that appear to be similar to the one you are currently trying to fill. As we all know, CVs can be somewhat embellished with some artistic freedoms and some judicious re-engineering, and there are some people who look great on paper and present themselves really well, but who are really a well-developed facade with very little solid structure supporting the attractive visible front.

Author: Rkwriting (own work); via Wikimedia Commons

Author: Rkwriting (own work); via Wikimedia Commons


Here are a few of these that I have come across in my time, and that one needs to look out for:

The 2-year cycler … On the surface, from their CV, they may look like they have 20 years of experience, but in reality they actually have only 2 years of experience repeated 10 times. These people have the ability to come in, stir everything up and drive change, but cannot sustain the momentum so run out of steam after about 2 years. The IT industry is full of people like this, as the industry has grown so quickly over the last 50 years that many people have never had to live with their own implementations and could just move on and start all over again before being seriously tested. Unless you have a 2-year assignment for them, don’t bother.

The empty suit … Looks the part and says the right things, but has an extremely shallow set of management skills and capabilities. This is the sort of person who works harder on looking as though they belong in the role rather than on actually doing the job. I once, in error, promoted a national sales manager to the role of MD. He immediately upgraded his suits and ties, whipped up his travel to first class and his hotel accommodation to suites, but changed nothing else in the way that he did the job, thus continuing to fulfil the function of the sales manager without taking up any of the responsibilities of a CEO, but he sure looked good while the business stalled.

Author: Argenberg; https://www.flickr.com/photos/argenberg/308888568/sizes/m/in/photostream/; CC BY 2.0 license; via Wikimedia Commons

Author: Argenberg; https://www.flickr.com/photos/argenberg/308888568/sizes/m/in/photostream/; CC BY 2.0 license; via Wikimedia Commons


The gift to mankind … Presents himself as the great saviour and the great leader. One interviewee described himself to me thus “I am very inspirational and a brilliant public speaker”. I decided to test him on his self-perception, so told him he had 5 minutes to prepare an impromptu speech on his view of “The meaning of life” and left the room for a cup of coffee. When I came back 5 minutes later he launched into a platitude-filled meaningless ramble which was far from brilliant and not at all inspirational, with really old hackneyed expressions like “I would rather have a bottle in front of me than a frontal lobotomy”. I have found that really great people don’t have to tell you of their greatness, in the same way that I am always suspicious of people who have to tell me how intelligent they are. Mensa members please take note.

The Engineer … I am always nervous about people who believe that it is all about the product rather than being about the people. I have no really serious issues with managers with an engineering background, though I do use them as a regular source of humour (see “Teaching old dogs new tricks” posted June 20, 2010), but I do sometimes struggle with senior managers in Europe who still believe that product is the main competitive advantage rather than having passionate, committed and self-driven people who understand what has to be done and how to go about doing it.

The seen-it-all-before … This is the “I’ve been everywhere, man” (made famous by Johnny Cash https://www.youtube.com/watch?v=MmFN9C9PVpg ). I have come across candidates in a recruitment process who have tried to convince me that the reason that I should hire them is that they have done everything, and seen everything that exists in their environment. As I have a strong belief that the right attitude is more along the lines of Randy Bachman’s “You aint seen nothing yet”, I have little time for people who believe that there is little left for them to learn, see or do. Learning is a life-long journey not a destination, and people who do not understand this do not deserve consideration for a senior role.

The sound-biter … Perhaps driven by the need to say something memorable in a 30-second TV news clip, I am surprised by the number of people who have forsaken the need to say something original and meaningful in their own words, for the convenience of dropping some sound bites. I once had a candidate tell me that “Leaders do the right thing whereas Mangers do the thing right” as being part of his personal philosophy. He went all a-dither when I asked him to explain to me what that actually meant for him, but in his own words. For much the same reason I have always looked somewhat suspiciously at people who see “The one minute manager” and “Who moved my cheese” as being great works of management insight, rather than being just some interesting brochures. Being a successful leader and/or manager is a tough role to fill, and is not for the simple-minded.

Author: Andre Engels; via Wikimedia Commons

Author: Andre Engels; via Wikimedia Commons


The recruitment process is one of the most critical elements of any manager’s role, and having the best people in place to provide leadership and direction to great people everywhere in any organisation is the key driver of success.

As said by American business consultant and author Jim Collins “People are not your most important asset. The RIGHT people are.”