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    Aug 18, 2022    |   Camille Labrie

3 Common Mistakes Organizations Make in Succession Planning

3 minute read
Written by Justin Deonarine, I/O Psychologist

We often hear the struggles that organizations face when trying to retain their high potentials. Our 2020 People Trends Report supports what we’re hearing from individual organizations, revealing that 75% of respondent organizations struggle to retain their future leaders.

When reviewing the research and the industry, I came across 3 common mistakes that organizations make in their succession planning efforts. These challenges are often those that cost companies their future leaders.

1) Focusing succession efforts solely on the C-Suite.

Most active leadership takes place on the front-line. When companies opt to focus their efforts only on the highest levels of the hierarchy, they lose the ability to stay connected with, and develop, the next generation of leaders.

This focus on only the higher tiers of the organization shows high potentials that there are limited opportunities for growth and development, forcing them to look elsewhere to realize their potential.

2) Assuming external candidates are more promising than internal ones.

Research suggests that larger organizations have an excessive tendency to hire new leaders from outside of the company. This is especially true when external candidates are already in the role being hired for. Organizations assume that success in the same role elsewhere will result in success at their organization. However, the same research suggests otherwise: When considering the CEO position, outside hires had a significantly lower chance of outperforming someone promoted internally.

Overreliance on this approach overlooks the talent being groomed internally. This results in high potentials concluding that there won’t be opportunities to move into a leadership role within the organization, and leaving to provide themselves with these opportunities.

3) Only considering one successor per position.

Putting all of your succession planning investment into one person is very risky. Despite the improved retention found from investing into your high potentials, sometimes life forces people to pursue opportunities elsewhere. In this case, investing only into one individual can leave you scrambling to adjust your plans. Meanwhile, without sufficient developmental opportunities, the other high potentials will have become disengaged.

There’s nothing wrong with considering multiple individuals for each role in your succession planning efforts. Even if they don’t see a promotion in the short-term, the act of engaging with them still improves retention.

What are successful organizations doing?

What about the organizations that are not only retaining their own top talent, but bringing in the high potentials from other organizations? What are they doing differently? In a nutshell, they are engaging with these individuals. A well-executed succession planning program contributes to their increased employee retention. High potentials see that they are valued, are receiving additional training, and understand that there is a future available for them in the organization. In other words, they don’t have to leave to grow (both when considering skill set and career progression).

While the specifics of their succession planning programs may vary, many organizations adopt the following framework as a starting point for their succession efforts.

Succession Planning Steps

Are you looking for a more effective way to identify your future leaders? Are you unsure of how to customize development plans to the individual’s strengths and development needs? Consider how the Work Personality Index Leadership Potential Report can help you improve your succession planning practices.

View Leadership Potential Report

 

Filed under: Leadership Development

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