Can I Get a Big Mac With a Side of Succession Planning?
Management Monday: Managing Succession Planning
McDonalds may not be the business to ask about healthy eating habits, but they do know something about succession planning. They have come to understand the costs and mayhem that are repercussions of losing key roles in the organization. It is thanks to their succession development process that the sudden death of CEO Jim Cantalupo in 2004 did not leave the company shipwrecked without a captain. Charlie Bell, a leader from within the company was prepared to step into the CEO role right away, keeping the company on track. And even when he was tragically diagnosed with terminal cancer and resigned only eight months later, the company was equipped for the emergency with Jim Skinner ready to take charge. Had McDonalds not been prepared with a plan B and plan C, where would they be?
92% of organizations recognize that not having a plan is risky. Despite the proven success of succession plans at leading Fortune 500 companies, such as McDonalds and LL Bean, many companies still don’t have a plan in place.
What Prevents Companies from Creating Succession Plans?
- Not knowing succession planning is a viable option
- Board failing to prioritize succession
- Fear of budget limitation
- Failure to execute a plan correctly
- Neglecting succession training or resources
- Lack of time to put the plan in place
Most of these obstacles are misunderstood or easily resolved. For example, the cost of hiring professionals to help develop an effective succession plan is far less than the cost of suffering from losing a CEO every five months. Below are some tips for organization’s to consider when it comes to succession planning.
3 Tips for Organizational Succession Planning:
- Recruit candidates whose goals align with company mission
- Foster leadership values in work culture
- Reward leaders and ensure they feel valued
- Never rush prospective leaders into their roles
- Outline clear policies and procedures for the succession process
- Consider having a back-up employee (or two) for every key company role at all times
Companies can implement these tactics with the help of expert internal Human Resources employees, or outside succession professionals. A good succession plan will leave every organization saying “I’m lovin’ it.”