With a growing number of organisations having to handle the loss of senior
managers at short notice, it’s clear HR must take the development of the
managers of the future very seriously
While it is widely recognised that leadership is vitally important to
companies at all levels, many organisations fail to plan for continuity in this
area.
A number of organisations have had to handle the recent loss of senior
managers at short notice. Those in the headlines include Amey, which lost its
new finance director after just 36 days in the job; HP Bulmer, which lost both
its chief executive and FD following accounting irregularities; the Bank of
England, which took a long time to replace David Clementi; and JJB Sports,
which has suffered the tragic death of chief executive Duncan Sharpe.
With the war for talent continuing, and people moving jobs more often, the
risk of managerial loss is getting more severe.
A recent survey by DDI identified the top concern of international senior HR
specialists as "a terrifying gap between the experience levels of
executives and their prospective successors" (see PersonnelToday.com’s
archives).
Where do companies go wrong? In the first case, many organisations are
simply not good enough at assessing and identifying the potential of their
staff for future leadership roles.
This is compounded by a lack of development of managers – especially those
who are not as positive in pushing themselves forward for promotion.
Even those who have good assessment techniques then fail to co-ordinate
their work across the organisation. They often just set up function or
countrywide ‘talent pools’, which are not shared with other parts of the
company.
Companies need to start taking succession planning seriously. It needs to be
made a key business responsibility that both HR departments and managers take
seriously at all levels.
The first key step to take is to demystify the whole process of promotion –
the company needs to communicate what is needed in managers and leaders, and
actively promote the benefits of achieving leadership positions.
This may be more difficult than it sounds. Equally, many companies have
suffered from a failure to recruit a diverse enough pool of talent to produce
suitable managers as market conditions change.
Once an individual is agreed to be of high potential, they need to be added
to a centrally managed ‘talent pool’. All managers need to be regularly
assessed to see if they should be in the pool, and those identified as key to
the future of the company need to be developed strongly – they also need to be
told that they are seen as managers of the future.
Improvements to work-life balance practices can be effective in increasing
the number of potential senior managers – especially female managers.
Companies cannot rely solely on internal succession in a crisis though –
moving people around will only serve to create ‘holes’ in other parts of the
organisation, and there needs to be a series of external options.
An external talent pool is much more difficult to operate than an internal
one, but should include people who have recently retired or moved to another
company and could be brought back, and admired industry experts and
competitors. It should even include people who were considered for a particular
role but eventually lost out.
Also, the employer should develop relationships with interim management
specialists in advance of any need – enabling them to understand the nature of
the corporate culture rather than having to start from scratch once someone has
left.
HR professionals need to be managing this process.
Hugh Flouch Managing director of organisational consulting, RightCoutts
