“The organization that is not capable of perpetuating itself has failed. An organization therefore has to provide today for the men and women who run it tomorrow. It has to renew its human capital. It should steadily upgrade its human resources.” – Peter F. Drucker
What’s going to happen to your organization when key people leave? You may end up scrambling. You may promote someone too quickly. Or hire an outsider who’s not a good fit. Overcoming these challenges may seem simple on the surface. But it’s not easy. There are a lot of moving parts. And it will take time to create a plan.
Why not plan now before you find yourself in this position? The future of your organization may depend on it.
When you’re ready, use the guide below to create a succession plan using competencies:
- Identify key positions
- Define the competencies
- Evaluate candidates
- Build development plans
- Integrate plans into performance management
Step 1: Identify key positions
Start at the top. For most organizations, this means VP-Level and above.
Among these, identify key positions for initial focus (perhaps five to seven). For our example, let’s say you identify your CFO, CTO, COO, VP of Sales, and VP of Marketing.
Step 2: Define the competencies
Each position has a unique set of competencies—in short, the knowledge and skills needed for success. To uncover the competencies:
- Review job descriptions and job postings.
- Research competencies defined by industry associations, experts, and competitors.
- Interview people in the positions, their supervisors, direct reports, and board members.
Now you’ve done your research on your key positions. It’s time to create the list of competencies, a blend of hard and soft skills that make a difference to the performance of your organization. Let’s take the CFO, for example. Competencies may include:
- Advising on strategy
- Cost management
- Risk management
- Financial reporting
- Communicating effectively
- Regulatory compliance
- Developing others
Step 3: Evaluate candidates
How do your candidates stack up against the competencies you’ve defined? Don’t rely on opinions. Be empirical. And rigorous. 360° performance feedback processes are one of the best ways to evaluate candidates.
Let’s say you identify four candidates for the CFO position from the next few levels down. Create a survey that measures these four candidates on the exact competencies you’ve defined (e.g., advising on strategy). Administer it in “360” fashion, that is, to the four candidates, their supervisors, direct reports, and peers.
Step 4: Build development plans
Identify the gaps between your candidates’ current abilities and the competencies needed for success. Some initial candidates may not be ready.
Let’s say you identify two primary candidates. Help those candidates find opportunities to address the gaps. Work with them to build development plans. Make the plans time-based. Include resources for learning. The plans may include:
- Training programs
- Executive development
- Special projects
- Job shadowing
Step 5: Integrate plans into performance management
Integrate the plans into your organization’s performance management process. Set goals that directly link to the development of these competencies. Track the progress of candidates toward these goals.
Bonus: Acquire top talent
The process we’ve laid out is designed to develop internal candidates. The same approach can be used in a proactive talent acquisition process. Rather than developing the competencies desired, look for candidates who already possess them. In place of the 360, build a behavioral-based interview process around the competencies.
Planning for the future is not easy. There are many mistakes to be made. But of all the mistakes you can make, one stands above them all.
Where will your organization be in three years? Who will be at the top?
If you would like to master your organization’s strategic planning efforts, contact Dering Consulting Group.