If you want one year of prosperity, grow grain. If you want 10 years
of prosperity, grow trees. If you want 100 years of prosperity, grow people.
~Chinese Proverb
Every business should have succession plans for its key
personnel as part of its overall strategic plan. It is critical to identify
personnel vulnerabilities and determine how you might overcome them. It is so easy to ignore these issues,
but doing so puts the firm in a very precarious position.
I was helping a firm that had lost a key executive to an
unexpected illness. When I was called in, the firm was reeling from the loss of
this very well-liked executive. In addition to the staff’s grief, the business
was in dire straights as they had been unable to find a replacement. Without
someone to take over, the executive’s work fell to his staff who lacked the
necessary experience. As a result, the profitability of firm fell dramatically.
Had this firm had a succession plan in place, they would have been in a much
better position.
Succession planning must address the loss of key staff
members both in the event they pass away suddenly or become significantly
incapacitated and in the event they simply retire. The difference between these
two situations, of course, is how much time you have to find a replacement.
There are two general ways a business can work through the
unexpected loss of key personnel. One way would be to ensure that the remaining
staff is able to pick up the slack. That way, the business can keep moving forward
until a replacement is found either by promotion or a new hire. A second
alternative would be to hire someone who can come in and fill the role on a
temporary basis. There are many firms out there that specialize in locating
temporary CEOs or CFOs.
When planning for the retirement of a key executive, you can
take one of two approaches. Firstly, you can groom a successor in advance so
they are ready to step in once the executive steps down. This plan should
involve providing any requisite training and experience.
If the firm is small, however, providing the necessary
training may be cost prohibitive. In the event grooming an internal candidate
is not a feasible option, the business can hire a replacement in advance of the
retirement, which would allow the successor an opportunity to work alongside
the executive, thereby helping ensure a smooth transition. Of course, as with
all hiring decisions, a significant amount of time and money should be invested
in finding the right person for the key position.
Now go out and make sure you have succession plans in place
for your key personnel. It is important to be prepared to take action in the
event of loss through retirement or an unanticipated event.
You can do this.
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