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Navigating a Leadership Transition: 5 Key Steps for Succession Planning

Changes in the top leadership ranks of companies are necessary, inevitable, and can be very healthy for the organization. Even when a CEO has a strong track record of performance, a transition to new leadership can bring a fresh perspective and infusion of new talents, ideas, and approaches that can drive and accelerate performance. On the flip side, top leadership changes can also be very risky and disruptive for the organization. The CEO and executive team set the tone for the culture of the company, they establish the vision and drive the strategy, and ultimately, they inspire the commitment of the employees. Getting succession planning right for these top roles is critical to ensuring a smooth and successful transition. While every company’s situation is unique, in our work with clients, we’ve discovered some key steps for succession planning success that are universally applicable.   

5 Key Steps for Succession Planning 

  1. Plan ahead – Don’t wait until the change is imminent.  Succession planning for key roles is an ongoing process that should commence well before a leadership change is needed. Starting early and continually reassessing provides an opportunity to cultivate an internal talent pipeline and enables proactive development of potential candidates.
  2. Consider the company strategy – Assess and understand where your company is and where it needs to go.  The strategic direction and objects of the company should be founded on in-depth analysis of external and internal opportunities. Determine if there are any major shifts in the direction, industry dynamics, economic landscape, or company culture that the new leader will need to be equipped to manage.
  3. Develop a capabilities profileIdentify what leadership capabilities and qualities are essential for driving the strategy and leading the company into the future. This is where you assess and outline the job responsibilities aligned to the competencies the new leader needs to bring to the table. Consider key attributes, talents, and experiences the leader will need to be successful.  
  4. Identify and assess candidates – Review candidates against the capability profile. Evaluate whether there are internal candidates who have the capabilities, or the talents plus potential, to meet the strategic needs and leadership characteristics. Ideally this is part of a regular – at least annual – talent and succession pipeline review process. In some cases, recruiting a top leader externally is the best path to accelerate change, establish a transformational strategy, or bring new perspectives and culture shifts required to lead the company into the future.
  5. Manage the transition – While identifying the future leader is the main objective, outlining and aligning on a clear plan to manage the transition in a controlled fashion is also essential for success. Invest in addressing and closing priority capability gaps through accelerated development activities and intentional partnerships with others to offset weak spots. Carefully consider and layout timing for the transition. In some cases, the leadership change will be immediate, while in others it can prove beneficial for consistency to ramp down the legacy leader and ramp up the new leader over several months. Establishing thoughtful communication planning and execution for the executive team, key leaders, critical customers, external stakeholders, and the organization at large will also be a key element of managing the transition. 

Ensuring a Successful Transition 

Transition in an organization’s leadership ranks offers the opportunity to intentionally assess the leadership needs to achieve the business’s future vision and align the talent, strengths, and capabilities of the successors accordingly.  Proactive planning, diligent review processes, and focused successor development are important to developing a rich talent pipeline and strong foundation for successfully navigating senior leadership changes. 

If you’re looking for guidance when it comes to succession planning at your organization, reach out to us today. 

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Tags: Strategic Advisory, Change Management