LEADERSHIP AND CULTURE BUILDING THE ROLE OF SUCCESSION

LEADERSHIP AND CULTURE BUILDING THE ROLE OF SUCCESSION PLANNING Michael L. Moore, Ph. D. mooremm@msu. edu May 14, 2015

Presentation Overview • Succession Planning as Strategic HR • Succession Planning as Leadership and Culture Building 2

Succession Planning as HR Processes Process Objectives: 1. 2. 3. 4. Build a talent pool and a leadership pipeline robust enough to ensure leadership continuity and organization success Develop potential successors by early identification of their strengths and the ways to harness these capabilities Identify the best candidates for different categories of positions Concentrate talent development resources to allow a greater return on investment 3

Strategic Positioning of Succession Planning! Succession planning recognizes that some jobs are the lifeblood of the organization and too critical to be left vacant or filled by any but the best qualified persons. Effectively done, succession planning is critical to mission success and creates an effective process for recognizing, developing, and retaining top leadership talent. 4

What Management Really Wants to Know! (first cut) 5

The Nine Box Process Approach Misplaced Growth Employee Future Leader Med. Unmotivated Solid Performer High Impact Performer Low Improve or Remove Potential Blocker/Barrier Trusted Professional Lo Med Hi Candidate Potential Hi Candidate Current Performance Level 7

How Can We Determine the Best Candidates? • • • Personal Bias Personality Testing Background Skills and Behaviors Accomplishments/Objectives Performance Equals Ability x Motivation x Cue Sense 7 a

Helping Your HR Process Achieve Success There are several factors typically found in successful succession planning initiatives. For example: • Senior leaders are personally involved. • Senior leaders hold themselves accountable for growing leaders. • Employees are committed to their own self-development. • Success is based on a business case for long-term needs. • Succession is linked to strategic planning and investment in the future. 8

Helping Your HR Processes Achieve Success (cont. ) • • • Workforce data and analysis inform the process. Leadership competencies are identified and used for selection and development. A pool of talent is identified and developed early for long-term needs. Development is based on challenging and varied job-based experiences. Senior leaders form a partnership with human resources. Succession planning addresses challenges such as diversity, recruitment, and retention. 7 a

Succession Planning Schematic Step 1 Link Strategic and Workforce Planning Decisions Step 6 Monitor And Evaluate Leader Commitment Employee Commitment to Step 5 Learning Implement & Succession Strategies Clear Program Goals Succession Planning Step 2 Analyze Gaps Step 3 Identify Talent Pools Step 4 Develop Succession Strategies 10

Highlighting Step 4 in the HR Approach Step 4: Develop Succession Strategies This step involves “Buy or Build” Decisions • Identifying recruitment strategies: § Recruitment and location bonuses § Special programs • Identifying retention strategies: § Retention bonuses § Quality of work life programs • Identifying development/learning strategies: § Planned job assignments § Formal development 11

Highlighting Step 4 in the HR Approach (cont. ) • Identifying development/learning strategies (cont. ): § § § Coaching and mentoring Assessment and feedback Action learning projects Communities of practice Shadowing 12

Highlighting Step 5 This step involves: Step 5: Implement Succession • Strategies • • Implementing recruitment strategies (e. g. , recruitment an relocation bonuses) Implementing retention strategies e. g. , retention bonuses, quality of work life programs) Implementing development/learning strategies (e. g. , planned job assignments, formal development, Communities of Practice) Communication planning Determining and applying measures of success 13

Highlighting Step 5 (cont. ) • Linking succession planning to HR processes § § § • Performance management Compensation Recognition Recruitment and retention Workforce planning Implementing strategies for maintaining senior level commitment 14

Succession Planning System Outcomes Illustration Reports Talent on Demand Succession Planning Roadmap 15

A Different Situation Succession Planning Roadmap – Detail by VP Longer Term Hi-Po Candidates, Timetable and Potential Interim Successor for "Emergency" 16

Getting Real! Winning the War for Talent Requires a Structured Approach to Four Business Practices 1. Defining Talent: look beyond the typical job description, tenure and experience approach filling front line manager positions. Look at demonstrated/prove ability with critical leadership competencies. How do you identify a winner? They win, consistently! 2. Discovering Talent: How early can you observe someone that demonstrates a natural aptitude for high performance? Do they set ambitious goals? Do they have high emotional intelligence (EQ)? Are they respected by others? Are they “Constructively Dissatisfied? ” 17

Getting Real! Winning the War for Talent Requires a Structured Approach to Four Business Practices (cont. ) 3. Developing Talent: Are your leaders coachable? Are they hungry to learn? Do they have mentors and role models that serve as best practice examples? Only then they will develop and “mine” talent by coaching others. 4. Deploying Talent: Consider “lateral deployment” for career advancement to appoint people in the right roles where their unique talents and skill can add value in critical high degree of difficulty roles. Align talent with difficulty. 18

Speedbumps in High Talent Prediction The Vital Shift Technical Work Managerial Work Lower Levels Middle Management Supervisors Executive Management Managers of Managers 19

The Unifying Concept “Leadership Brand” David Ulrich and Norm Smallwood Harvard Business Review, July 2007. 20

Leadership Brand Assessment How does your organization rate on the following statements, on a scale from 1 (low) to 5 (high)? We know how we want to be viewed by our target customers, and we have articulated a clear company identify based on this. We have articulated a clear statement of leadership brand that is connected to our firm’s identity. We have translated our statement of leadership brand into a set of desired leadership actions. We have a process to identify development gaps in our next generation of leaders. Our individual leadership development plans include acquiring skills, knowledge, and perspective that matter to our target customers. We invest in training experiences that include customer perspectives. We create job experiences that develop customer perspectives within our leaders. We encourage our leaders to invest in life experiences that help them build relevant customer knowledge and skills. We gauge the effectiveness of leadership investments by our business results. We rigorously communicate to all stakeholders the degree to which we invest in building a leadership brand. Total : 21

Succession Planning Key Points • Organization continuity is based on today’s decisions • Leadership must consider individual attributes but must also focus on the future credibility of your firm’s leadership brand. • Today, many organizations have promoted too many people too far too fast and can now see glaring weaknesses in leadership and gaping holes in competence • Today, there is a War for Talent 1. Scarcity of Candidates 2. Role Splitting for VP’s 3. Accelerating compensation costs for replacements 4. “Poaching” 5. Longer times needed to fill key roles 6. Internal disruptions often accompany appointments 22

Final Thought “It is now time to take Succession Planning and Leadership Brand building seriously” Mike Moore, 2015 23

10 Steps for Strategic Succession Planning 1. 2. 3. Create clarity on the strategic vision Determine organizational competencies needed to fulfill the vision Assess required competencies for CEO role in the future (5 and 10 year projections) 4. Identify potential internal successors 5. Assess competencies of internal successors 6. Develop a career development plan or leader development plan for high potential individuals 7. Implement the development of each potential successor 8. Develop a viable action plan to acquire needed competencies 9. Research external potential candidates 10. Develop a CEO emergency succession plan and policies Sources: CUES Succession Planning Essentials (2007) p 28 -33 24