22 February 2007

Succession planning my ass

Leaders not being groomed, study finds

Most Canadian companies are unprepared for an abrupt change in leadership, according to a succession study that found many are also bad at spotting internal talent and grooming them to climb the hierarchical ladder. A survey of managers found that just 18% of companies had a contingency plan that identified someone who could fill the shoes of an essential senior executive. “It is not an easy conversation to have,” said Peter Hausdorf, an associate professor of industrial psychology at the University of Guelph, who wrote the study with PhD candidate Rebecca Slan Jerusalim. “Who wants to ask the ceo what he thinks will happen when he leaves or if something happens to him?” Difficult or not, Hausdorf believes companies that don't have that conversation are flirting with danger. “If something happens and you have to respond during a crisis, you may put the wrong person in that role.” A company without a key top executive might appear rudderless, resulting in uncertainty for leaders and employees, Hausdorf said. A prolonged void could also trigger an internal catfight, with senior leaders jockeying for the coveted top job.

In addition to looking at short-term succession plans, the study also looked at whether companies are pursuing long-term strategies to identify exceptional employees as future executives and foster their talents. The looming retirement of the baby boomer bulge will leave some very senior corner offices vacant over the next decade. However, this study found that less than a third - 31% - of Canadian companies had programs to identify and develop future leaders. Most companies prefer to promote one of their own, he said, since they will get someone who is up to speed on the business and the clients, as well as the internal culture. Nevertheless, the corporate practice of spotting high-potential up-and-comers and grooming them for management positions is relatively new, Hausdorf said.
(Globe and Mail 070221)

This is EXACTLY the conversation I've had with people recently. Why aren't corporations more concerned about this? Why aren't the Boomers who know they are in a position to retire in the next five years putting definitive succession plans into place? Like the conclusion we made on this, I believe most of them are more focused on their retirement nest egg rather than the long term health of the company they work for or the long-term health of the economy.


Acquiel said...

So true, I'm always wondering what is going to happen in 5-10 years max. There will be a massive retirement movement and I'm not sure if the companies are ready to assume it.

It might be interesting to add in the equation the 2 generations which are probably going to "fight" for these CEO jobs. (Gen X-last are born in 1980 and the millennium gen- born after 1980) I'm wondering if they translated in English the book: "Les bommers finiront bien par crever" (the boomers will die someday, but more offensive) It is a very interesting book relating why the different generation act as they do. It offers a new point of view to understand the generation conflict. Is there any conflict here in Alberta? I know it was getting more and more obvious in Quebec but I haven't seen it here yet.

Jeff Skybar said...

OPh, On Saturday let me fill you in on the gong show going on around at PC. you'll laugh, you'll cry and it's just such a shitshow.

Succession planning is key, however if managers of today are trying to be role models for the younger generation, we're in trouble. ANother 25 years of chaos in the workplace with a bunch of highly ineffective and inefficient managers. So if companies want succession planning, make sure the current managers are in sync with actually being a manager and not avoiding the role all together.

doug said...

I'm not even surprised. Long term planning seems to be such an unimportant concept these days. From the environment,oil, to immediate conumer gratification. Lets face it humans for the most part are procrastinators and poor planners - especially when there is trouble looming in the future. I mean really, planning for the future can really take the BUZZ out of todays debauchery. Ticketmaster is just proof. They know you GOTTA see superstar XYZ and will pay through the nose to do it.....instant gratification remember! Same goes for inflation in Calgary.....more money means more spending = higher inflation. I say fuck it and get what you can now because who knows what tomorrow will bring. Its too bad that that type of thinking may do us all in eventually. Then again we MAY wise up. I'm not counting on it though???? Time will tell.