Succession Planning Part 3: Create a Pipeline of Talent

IIn Succession Planning Part 2: Knowledge Capture©, we covered how to identify what information needs to be recorded and transferred to your successor. In this part of the series, we will talk about finding the right person to take your place.

Now that you know what, who?

Once you have identified what the position you are looking to fill entails, you will need to determine who the best candidate is to assume those responsibilities. One of the key aspects of effective succession planning is to create a robust pipeline of talent, ensuring that there are competent and capable individuals ready to step into leadership positions when the need arises.

This step involves considering both internal and external candidates and developing a structured approach to identify and assess potential successors.

3.1 Internal vs. External Candidates

When considering potential successors, organizations have the option to choose from internal or external candidates. Consider the employees you already have, their strengths, and their potential for growth. Use the talent within your business as a jumping off point to see who else can match the work ethic and level of responsibility you are looking for. Let your employees know that your organization is looking internally to boost morale and improve employee retention. In contrast, external candidates have the opportunity to bring new ideas and strategies to your organization. Consider both approaches, as each offers distinct advantages and considerations:

3.1.1 Internal Candidates

Internal candidates are individuals already working within the organization who possess a deep understanding of the company's culture, operations, and values. They offer several advantages for succession planning:

Familiarity with the Organization: Internal candidates already know the organization's processes, stakeholders, and goals, which reduces the time needed for onboarding and adaptation.
Provides an Incentive to Stay: Recognizing internal talent and providing growth opportunities can serve as a powerful incentive for employees to remain committed to the organization.
Higher Probability of Success: Internal candidates have demonstrated their capabilities within the organization, giving them an advantage in assuming leadership roles.

3.1.2 External Candidates

External candidates, on the other hand, bring fresh perspectives, experiences, and skillsets that can invigorate the organization. They can offer a valuable infusion of new ideas and approaches, which may be particularly beneficial in times of change or transformation.

Fresh Ideas: External candidates may offer innovative solutions and novel approaches that challenge the status quo.
May Lack Internal Depth: While external candidates bring diverse experiences, they may take some time to familiarize themselves with the organization's unique dynamics and culture.
Lower Probability of Success: The success of external candidates may be less certain compared to internal candidates due to the learning curve associated with joining a new organization.

3.2 Having an Internal and External Plan

It is important for organizations to have both internal and external succession plans in place. By considering candidates from both groups, organizations can maintain flexibility and preparedness to meet unexpected challenges or opportunities.

Additionally, business owners should develop a plan for their own succession. Contemplating how and to whom they might sell their business ensures a well-structured exit strategy and secures the future of the organization.

3.3 Creating a Scorecard for Candidate Assessment

A scorecard is a research-proven tool that facilitates effective and impartial assessment of potential candidates for leadership positions. By assigning numeric values to specific capacities, experiences, and skills needed for the position, the scorecard quantifies the requirements and expectations for potential successors.

3.3.1 Key Components of the Scorecard

Listing Key Experiences or Resources: The scorecard should include 5-7 key experiences or resources that a successful candidate for the leadership position must possess. These experiences should directly align with the role's responsibilities and requirements. Use your Knowledge Capture © matrix to help identify these exact requirements. You can follow a similar scale of generic to specific responsibilities to match a candidate to your needs more closely.
Specificity and Points Allocation: The scorecard should be specific, avoiding generic descriptions. For example, instead of stating "should know budgets," the scorecard could specify "has created budgets for centers with a budget of $500,000 or more." Each experience is assigned a specific point value based on its importance to the position. Items of higher importance have larger point values while more minor requirements have lower point values.
Quantifying the Position: The scorecard provides a tangible measure of the leadership position's requirements, making it easier to compare and assess candidates objectively. While the human element of hiring is an important factor to consider, using the scorecard can help prevent our emotional decision making from taking the forefront.
Identifying Areas for Development: By using the scorecard, potential candidates can identify areas in which they may need to further develop their skills or experiences to be more competitive for the role. Use your scorecard as a means of reporting these areas to potential candidates. The more aware they are of their own strengths, the better they can serve an organization.

3.4 Utilizing the Scorecard for Succession Planning

The scorecard serves as a valuable template for assessing both external and internal candidates. For example, organizations can use it to identify areas where an internal candidate may require additional training or exposure to meet the position's requirements. Use this assessment to guide professional development efforts.

For instance, if an assistant director lacks experience in financial management, the organization can provide opportunities for her to attend relevant training courses or involve her in financial decision-making processes to enhance her skills.

Conclusion

Creating a pipeline of talent through a thoughtful combination of internal and external candidates ensures that organizations are well-prepared for leadership transitions. By using a scorecard to objectively assess potential successors, organizations can identify the most suitable candidates and develop targeted strategies to nurture their growth and development. An effective succession planning process not only secures the continuity of the organization but also fosters a culture of development and advancement, attracting and retaining top talent for future leadership roles. To begin planning for the actual transition, see Part 4 of this series.

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