Leadership succession for business growth and continuity.

• Author: Laforest, Sara
• Position: Special section: 2012 CORPORATE 100 - Geographic overview

Does your business have a leadership succession program in place to secure its continuity and growth? Unless no one gets sick, quits, or dies, a plan is in order. Too many small businesses default to the practice of reactionary assignment of a successor amid a now glaringly vacant position, or embark on a rushed external hire that often ends up as a high cost disappointment from a "hiring misfire." The consequences are not only expensive but are also a missed opportunity, due to lack of focus and the inability to support fast growth.

A succession strategy is about having an identified plan to fill key positions within your organization. A succession program is the implemented process of identifying, developing and transitioning potential successors for the company's present and future key roles, aligned with the talent and ambition of its current employees.

REALITY IS DYNAMIC, NOT STATIC

A common error that we see in succession planning is to target only the key executive roles (CEO, COO, CFO). We see this as a significant risk unless you are a micro business. For example, if you are in the construction or transportation industry, a logistics manager may be critical for the success of your business. Having a vacancy in this position could quickly result in a decrease in service and an increase in customer complaints, and possibly a decrease in customer retention; which is why critical positions across the business need to be identified and replacement processes planned.

In our work with companies we hear some common arguments and justifications. We repeatedly see that the president or key executive doesn't believe there is an immediate need for a succession plan. Their stated arguments are, "we're too small," "we're too new," "we already have good people in place," or "I'm not going anywhere soon!"

In an unlikely static environment where no one leaves, no one gets ill (including the owner, president or senior managers), growth isn't that important, and performance is exceptional--these arguments hold true. But, the reality is that we don't live in a static business environment. People do leave, they do get sick, the executives need to focus on growing the business versus operating it, the employees are not all good performers, and some roles are hard to fill!

There is also a tendency to hold on to marginal performers because there is no clear plan on how to replace them. The impact: the business suffers, the executives suffer, employee...