SUCCESSION MANAGEMENT Building Your Talent Bench

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SUCCESSION MANAGEMENTBuilding Your Talent Bench
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agenda
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reasons for succession management

• To develop a talent pipeline pool
• To find out well in advance successors for each
  key position in the company
• To ensure readiness of the individuals for taking
  over
• To ensure minimum disruption/smooth transition
• To continuously foster organizational
  effectiveness
• Provide increased opportunities to high potential
  talent
• Help individuals realize their career plans
  within the organization
• Niche skils - supply gap
• Hygiene

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approach

Organization Plan
Talent Plan

• Organization Strategy
• People Strategy

Track Implement Plan

• Succession Planning for
• Critical Roles
• Talent Pipeline High
• Potential
• Talent Retention

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Recent Research Data

• 40 of those surveyed said that company growth
  was limited because they didnt have the right
  talent.
• 75 said that their company is chronically short
  of leadership talent.
• Failure rates are high (40-50) when executive
  talent is hired from outside.
• Two-thirds of employees have low to moderate
  confidence in their companies top executives
• Employees say company leadership is a key
  contributor to job satisfaction, commitment and
  intent to stay especially true for top talent.
• Recent surveys state that employees value most
  the leadership qualities of honesty and
  integrity.
• Only 1 of companies rate their succession
  management plans as excellent two-thirds rate
  them as fair or worse.

-McKinsey, The War for Talent, Rights People
Brand Research Report, DDI Exec. Dev.
Succession Management
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key elements
Identification of Key Talent
Assessment of Key Positions
Assessment of Key Talent
Succession Management
Development Monitoring Review
Generation of Development Plans
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Lets pause.

• Have you lost high potential talent because they
  didnt know they were on the list?
• If your executive team got run over by a bus,
  would their replacements be able to step right in
  and be productive?
• Is anyone on the top floors or in the Boardroom
  worried about the status of your talent bench?
  
• What lost opportunity costs has your organization
  incurred because it took a long time to replace
  a key leader?

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Lets pause..

• How does someone in your organization get
  selected to be a potential successor?
• Do you have leadership development and talent
  management processes in place to grow successors?
• If your organization has succession criteria, is
  it past focused or future oriented?
• If you have a succession planning process, is it
  grounded in your business strategy?
• Would your selection/promotion practices pass a
  drop in legal challenge?

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key success factors

• Secure senior level support
• Align with future organizational strategy
• Keep the process simple so that busy line
  managers do not find the process burdensome
• Engage technology to support the process
• Continual reinvention
• Global approach

Build or Buy ?
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Evolution of Succession Planning

• Near-term needs
• Back-up charts
• Critical positions
• Risk management

• Immediate needs
• Single positions
• Crisis management

• Long term needs
• Key leadership roles/pools
• Talent Reviews
• Development plans

• Strategic focus
• Active, ongoing process
• Pivotal talent pools at all levels
• Leadership org development

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why it fails..

• Succession management not linked to business
  strategy
• Reactive approach only when a position becomes
  vacant
• Lack of ownership by top management
• Line managers ignore development of the talent
  pool
• No formal process to track candidates
• Lack of objective, data based discussions

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role of top management

• Communicating their support
• Share perspectives on the future leadership needs
  of the organization
• Ensuring that it is perceived as management
  directive, not just a HR initiative
• Volunteer to be part of succession management
  process
• Ensure allocation of adequate resources

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role of hr

• Targeted processes
• Ensure comprehensive assessment of talent
• Creation of talent databases
• Identification of future talent requirements
  being pro-active
• Structured individualized development planning

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• Talent hot houses

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_at_ PG

• Rigorous leadership program - Build From Within
• Each of the top 50 jobs has three replacement
  candidates lined up
• Ensure each successor gets the experience to be
  ready for the next job
• They train people to work in different countries
  and businesses so as to develop a deep bench
  globally
• The disadvantage is that people did think in
  similar ways

President Chief Executive, PG From A.G.
Lafley to Bob McDonald in 2009...
Today I could show you the next generation
of successors to current leaders, the
generation after that, and the generation after
that. - Moheet
Nagrath, Head of Human Resources at PG
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_at_ GE

• Jack Welch (Chairman CEO, GE) submitted a list
  of 23 potential CEO candidates to the Management
  Development Board in 1994
• Successors reviewed every June and December by
  Board and Welch
• No outside candidates considered
• Succession plan was closely tied with management
  leadership development plan
• Leading contenders were put on various proving
  grounds given cross business exposure
• GE Board made regular visits to get impression of
  the candidates natural style and approach

From Jack Welch to Jeffrey Immelt in 2000...
From now on, choosing my successor is the
most important decision I'll make. It occupies a
considerable amount of thought almost every
day.
- Jack
Welch, 1991
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_at_ Wipro

• Succession Planning program is called Talent
  Review Planning (TRP)
• Identify employees who are ready to take over
  the critical roles immediately and over the next
  1-2 or 2-3 years
• Developmental planning for each identified
  internal candidate - job rotation, training,
  coaching and performance counseling
• They also keep track of potential external
  candidates, and establish touch points for
  attracting them at the appropriate time
• Training could be through internal programs or
  on-the-job (local as well as global) to gain
  cross-functional or cross-geographical exposure

Azim Premji succession plan disclosed to board
of directors
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_at_ HUL

• System of listers
• Continuous process of discussing people
• Identifying people at different levels
• For the distance they will be able to travel in
• their career
• The process is centered on
• Identifying a list of potential candidates
• Placing them in specially chosen and challenging
  
• roles
• Then observing the outcomes

Nitin Paranjpe joined HUL in 1987 as mgmt
trainee, appointed as CEO MD in 2008
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_at_ LT

• Six out of eight Executive Directors on the board
  are retiring within three years, including AM
  Naik (Chairman MD, LT)
• The company is putting in place an interim
  leadership team to steer the company until 2015
• Two global consultants McKinsey Bains are
  working on a succession plan for the company

Successor yet to be identified for AM Naik
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_at_ airtel

• Critical positions identified as part of OTR
  process basis
• Impact on financials
• Exposure to brand
• Uniqueness of the skill (Supply in market)
• Span of influence control
• Relevance of position If redesign the org
• from scratch would this role be there
• Impact on customers / shareholders / investors
• External value (How much sought by
• competition)
• YLP,eLeap,bLeap,Shadow boards

From Manoj Kohli to Sanjay Kapoor in 2010...
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_at_ airtel

• Succession Plans created for all critical
  positions
• Succession Plan analyses the possibility of
  making a growth plan after matching employee
  strengths / skills / development needs with the
  Business needs and requirements

Position Position Current incumbent Current incumbent Current incumbent Current incumbent Potential Successor Potential Successor Potential Successor Potential Successor Potential Successor Potential Successor
Function Critical Position Current Incumbent Planned Move Time for the Next Move (0-12mths/1-2/gt2) Retention Risk Name Readiness (Ready now/1-2 yrs /gt2 yrs) Talent Segmentation Retention Risk Openness to Relocation (Yes /No) Comments / Development Needs / Next Assignment
                       
                       
                       
                       
Guiding Metrics N ( Numerator) D ( Denominator ) Month 1 . Month 12
Out of internally closed positions filled by identified successors Total no of positions closed by identified successor Total no. of critical positions filled internally N/D   N/D
Career Plans implemented No. of people movements as per plans captured Total no. of Successors to critical Positions N/D   N/D
Development Plans implemented Total no. of Development Plans implemented Total no. of Successors to critical Positions N/D   N/D
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Bosses are stewards of peoples talent
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Thank you!