William J. Rothwell - Effective Succession Planning (2005)(3-e)(en)

85+

80–84

75–79

70–74

65–69

60–64

55–59

50–54

45–49

40–44

35–39

30–34

25–29

20–24

15–19

10–14

5–9 0–4

Population (in millions)

Source: U.S. Census Bureau (2000). Population pyramid summary for China. http://www.census.gov/egi-bin/ipc/idbpyrs

..pl?cty IN&out s&ymax 250.

Exhibit 14-5. Age Distribution of the Population in the United Kingdom in 2025

85+ 80–84

75–79

70–74

65–69

60–64

55–59

50–54

45–49

40–44

35–39

30–34

25–29 20–24

15–19

10–14

5–9 0–4

Population (in millions)

Source: U.S. Census Bureau (2000). Population pyramid summary for the United Kingdom. http://www.census.gov/egi-bin/ ipc/idbpyrs..pl?cty IN&out s&ymax 250.

begin to focus on older workers and institute policies to encourage people to retire later. These older workers will represent an important political group, exerting influence directly or indirectly on government policymakers.

Although managers in the United States are often tempted to think only in terms of domestic talent, the fact remains that SP&M issues have a global impact and may require a global solution. At one time, many companies relied heavily on expatriate labor forces to meet succession needs globally. In other

85+

80–84

75–79 70–74

65–69

60–64

55–59

50–54

45–49

40–44

35–39

30–34

25–29

20–24

15–19

10–14 5–9 0–4

Population (in millions)

Source: U.S. Census Bureau (2000). Population pyramid summary for France. http://www.census.gov/egi-bin/ipc/idbpyrs

..pl?cty IN&out s&ymax 250.

words, when they needed specialized skills not available in the developing world, they simply exported talent from the developed world. But this strategy is less frequently used as decision-makers pursue localization strategies designed to identify and accelerate the development of high-potential local talent.9

A localization strategy has many advantages. One such advantage is that it builds the bench strength across the corporation, serving as a rising tide that lifts all boats. In other words, the corporation builds bench strength everywhere rather than relying on exported talent. A second advantage is that local talent faces no problems adapting to the local culture the way expatriates do. A third advantage is that local talent is not resented, as expatriates often are, for the higher wages and better benefit packages they receive. A fourth advantage is that a localization strategy provides political and public relations advantages, since the organizations are seen as building the local economy rather than exploiting it.

In the future, localization efforts will increase. Government policymakers may even require it. Additionally, forward-thinking corporations will find ways to hitchhike on the talent they have internationally by using online and other virtual methods to encourage ‘‘sharing,’’ telecommuting, videocommuting, concurrent work (prepared in one nation but used in another), and idea generation across borders. These developments have profound implications for SP&M, since they can build competencies at the same time as the work is performed.

The challenge for SP&M program coordinators will be to find ways to carry so-called soft skills technologies—such as management and HR practices— across cultures. That may require special programs to encourage information-

sharing and skill building across cultures, through either online or face-to-face approaches.

Prediction 4: Succession Issues Will Be Influenced by Real-Time Technological Innovations

As Chapter 12 showed, technological innovation is already exerting a major influence on succession issues. This trend will continue. Right now, many organizations are using online methods for recruitment. In the future, online methods will be used in real time to conduct competency modeling, potential assessment, performance appraisal, individual development planning, and individual coaching.

The challenge for SP&M program coordinators will be to find and apply these approaches. One major goal, of course, is to slash cycle time for filling key positions and sourcing talent. Another major goal is to lower geographical barriers, making it possible to access—and develop—talent anywhere and at any time.

Prediction 5: Succession Planning and Management Will Emerge as an Issue in Government Agencies, Academic Institutions, and Nonprofit Enterprises

Traditionally, sectors of the economy other than business have been slow to adopt effective SP&M practices. Government agencies, academic institutions, and nonprofit enterprises have not typically attempted to identify replacements for key positions and have often relied on a talent-pool approach, which is more consistent with the laws, rules, regulations, political realities, and organizational cultures found in these economic sectors. Additionally, government agencies and academic institutions in particular have found systematic succession approaches difficult to use because of institutional policies or civil service regulations that require competitive searches, job posting, and preferences based on factors other than individual performance. Efforts to groom individuals in these settings have sometimes been prohibited rather than encouraged. One result has been long lead times between the appearance of a vacancy and the appointment of a successor.

However, as a direct result of increasing turnover, increasing retirement rates, lagging salary and performance bonuses, and the greater rewards in a private-sector economy that makes the (relative) security of government service and academic appointments less appealing than they once were, I predict that government agencies and academic institutions will be forced to adopt more systematic succession practices. It is no longer effective to follow the business-as-usual approach of ‘‘calling for the list’’ of qualified individuals who have taken civil service exams or ‘‘conducting a national search’’ for each academic appointment by simply placing one advertisement in the Chronicle of Higher Education. The reason? There are few, if any, candidates on the civil

service ‘‘list’’ and few, if any, applicants sending in material to Chronicle advertisements for academic positions. This problem is particularly acute at senior levels in government and in educational institutions, where people do not want or need to move.

It is important to understand that these problems take different shapes in government, educational institutions, and nonprofit organizations; hence, they require different solution strategies. Within each economic sector, differences in procedures also exist. For example, in government, human resource practices have not been the same among local, state, and federal agencies. In academic institutions, human resource practices have differed among govern- ment-supported and privately funded colleges and universities. In nonprofit enterprises, unlike in government agencies and academic institutions, the intrinsic satisfaction of the work has mediated the need to pay competitive salaries or provide competitive benefits.

However, these three economic sectors do share similar challenges. Indeed, the key challenge is to find better ways to recruit, retain, motivate, and cultivate talent without sacrificing existing civil service laws and rules and without sacrificing merit-based employment in favor of political patronage, nepotism, or unlawful discrimination. There are no simple answers, and each institution needs to form a task force and focus attention on improving succession within the framework of its existing policies, procedures, and governmental laws, rules, and regulations. The challenge for SP&M program coordinators will be to find ways to adapt the approaches recommended in this book to the unique settings of government agencies, academic institutions, and nonprofit enterprises.

Prediction 6: Succession Planning and Management Will Lead to an Increasing Policy of Organizational Openness

Many organizations still do not share information about openings with the prospective successors for key positions. Some executives worry that such openness might lead to problems such as ‘‘greenmail’’ or the ‘‘crown prince dilemma.’’ Greenmail occurs when designated successors attract lucrative offers from other employers and then leverage them to achieve counteroffers from their current employers. The crown prince dilemma occurs when designated successors believe they are guaranteed advancement, rest on their laurels, and let their performance decline.

Despite these potential problems, however, I predict that organizations will be forced to become more open about naming future successors. If they do not, they risk losing their high potentials to employers that are more open, make promises, and are forthcoming in offering attractive employment packages that include professional development opportunities.

Exhibit 14-7. Important Characteristics of Career Planning and

Management Programs

Directions: Use this worksheet to rate your organization on how well it addresses important issues in career planning and management. For each characteristic of an effective career planning and management program listed in the left column below, rate how well you believe your organization rates on that characteristic in the right column. Use the following scale:

1 Not at All Effective

2 Somewhat Ineffective

3 Somewhat Effective

4 Effective

Interpretation of the Score

Exhibit 14-8. An Assessment Sheet for Integrating Career Planning and Management Programs with Succession Planning and Management Programs

Directions: Use this worksheet to assess how well your organization’s career planning and management program is integrated with your SP&M program. For each characteristic of effective career and succession programs listed in the left column below, rate how well you believe your organization has integrated them in the right columns. Use the following scale:

1 Not at All Integrated

2 Somewhat Integrated—but Not Enough

3 Well Integrated

4 Very Well Integrated

Interpretation of the Score