Upload
anshuvivek
View
774
Download
2
Tags:
Embed Size (px)
Citation preview
www.vivekmehrotra.com
Malaysian HR Congress 2007
Succession Planning
www.vivekmehrotra.com
What if something happens to the CEO or to a senior executive of my organization?
Who will replace him?
Will the new incumbent have the maturity and the desired competence to execute all responsibilities?
Are people other than him, groomed enough to fill the void that would be created by his absence?
www.vivekmehrotra.com
Charlie Bell, President and COO of McDonald, succeeded Jim Cantalupo, CEO hours after the sudden heart attack death
Mr. Zeien, succeeded Chairman and CEO Colman
M. Mockler of Gillette Co.'s when he died of a heart attack in his office
The Wall Street Journal Online
www.vivekmehrotra.com
Session Outline Succession Planning - an introduction Succession Planning @ family run business An approach towards Succession Planning Steps to effective Succession Planning Identifying and nurturing Hi-Pos Potential and Performance mix of a Hi-Pos Putting success into Succession Planning How to measure its effectiveness Conclusion
www.vivekmehrotra.com
Succession Planning Is not just a process to merely find a deputy or 2IC It is a conscious process to ensure continuity of
Business Operations
Organization’s Policies
Organization’s Culture
www.vivekmehrotra.com
Organic Business Growth
Mergers
Acquisition
Promotions, Demotions & Transfers
Business Re-engineering
Succession Planning“Global aging (Over the 1998 - 2008 period), more job openings are expected to result from replacement needs (34.7 million) than from employment growth in the economy (20.3 million)” (Braddock, 1999)
www.vivekmehrotra.com
Succession Planning: an age old art
H Recruitment of appropriate candidateetaining the good performers
www.vivekmehrotra.com
Getting the right number of people
with the right skills, experiences, &
competencies in the right jobs
at the right time.
Workforce Planning
Nancy B. Kiyonaga, NYS Department of Civil Service
www.vivekmehrotra.com
Succession planning ensures that there
are highly qualified members for all
important positions, not just today,
but tomorrow, next year, and
five years from now.
Succession Planning
Kathryn Towe Littleton
www.vivekmehrotra.com
What does an organization lose if it does not implement succession planning?
Revenue? Market Share? Company’s Image? Stock Prices or Market Cap?
Human Cap? Workplace will lose high performers
Lack of skilled workforce that understand business well
Right skill mix for the future
Right leaders to accomplish organization’s Vision & Mission
www.vivekmehrotra.com
Succession Planning = Commercial Success There is a direct correlation between:
Organization’s ability to develop senior executives & Confidence to meet future growth needs
Organization’s ability to recruit highly able executives & having well-organized program to develop Hi-Pos’
Developmental ‘stretch’ assignments within company & the personal involvement of the CEO Organization’s need to hire outside leaders
& Lack of confidence to meet future growth needs
HUMAN RESOURCE MANAGEMENT, VOL. 13 NO. 1 2005
www.vivekmehrotra.com
A process that ensures…
• Right people to lead tomorrow… who live the values,
today
• Organization identify / recruit future leaders
• Employees develop new competencies & skills
• Organization alerts its rising stars to potential leadership opportunities; well in advance
Succession Planning… what is it?
www.vivekmehrotra.com
A process that ensures…
• Better talent retention
• Greater employee satisfaction
• Enhanced commitment to work by the employees
• Improved image of organization
Succession Planning… what is it?
www.vivekmehrotra.com
Succession Planning… what isn't?
Succession Planning is similar to Workforce Planning
It’s an option with management to develop leadership
Succession Planning & Leadership Development are Two different HR processes Stand-alone activities coordinated by HR department
Line Managers do not have much role in Succession Planning & Leadership Development
Lack of Succession Planning may not pose a similar threat as accounting blunders or missed targets
www.vivekmehrotra.com
Succession Planning: the reality
Most globally recognized Indian organizations are not properly equipped with a sound succession plan
Very few Indian companies have been able to effectively implement a succession plan for its important and strategic positions
(A survey by the Associated Chambers of Commerce and Industry of India)
www.vivekmehrotra.com
Succession Planning @ Family run businesses More than half of the top 100 companies are family
owned De-merger of business families, with trauma and
acrimony, is fairly common in India.
Reliance Industries – Mukesh & Anil Ambani Bajaj Auto – Rahul & Shishir Bajaj Escorts – Rajan & Anil Nanda Jumbo Group – Bhavika, Kiran & Komal Chhabria
Sahad P.V. - Family Values
www.vivekmehrotra.com
Succession Planning @ Family run businesses
Family run business groups, which dealt with Succession issues successfully
Murugappa Group Dabur India Thapars GMR Group
Sahad P.V. - Family Values
www.vivekmehrotra.com
Succession Planning @
GMR group’s Succession Plan Clearly articulated set of rules to deal with
Management succession Ownership succession Control and power sharing
Sucheta Dalal, CHEQUES AND BALANCES
www.vivekmehrotra.com
Family Constitution Family Business Board Laid down policies on
Consensus in decision making Media policy Code of conduct Process of inducting family members into the business Providing benefits to those who do not want to enter the
business
Succession Planning @
www.vivekmehrotra.com
G M Rao to step down at the age of 70
Three next generation successors to decide next chairman Dead lock trustee Induction of family members is on merit and are paid on par
with other professionals employed
The economic benefits of shareholding will be separate
Succession Planning @
Sucheta Dalal, CHEQUES AND BALANCES
www.vivekmehrotra.com
Succession Planning @ Family run businesses Ownership Vs. Management
Family owns the controlling shares, but inducts professional managers to run their business.
Retail giant Rob Walton - Chairman Lee Scott - CEO
"Successful business families are those who runbusinesses as capitalists and families as socialists."N. Srinivasan
www.vivekmehrotra.com
Succession Planning @ India's largest pharmaceutical company
1952, Bhai Mohan Singh founded Ranbaxy 1967, Dr Parvinder Singh, Bhai Mohan Singh's son, a
doctorate in pharmacy from the University of Michigan joined the company
1982, he became the company's Managing Director
1993, D.S. Brar joined as Business Development Manager, became the President (Pharmaceuticals) and a whole time Director
ICFAI - Center for Management Research
www.vivekmehrotra.com
1997, Brar revealed his retirement plans to retire in 2002.
2003, Dr Brian Tempest (President, Pharmaceutical Division, Ranbaxy) took the reigns of Ranbaxy from Brar as CEO and MD
2006, Malvinder Singh has taken over as CEO & MD
Succession Planning @ India's largest pharmaceutical company
www.vivekmehrotra.com
Succession Planning @ Corporates
Long Term Succession PlanningWho is completing his term this year?Who have the skills to replace this position?Who has necessary skills & ready for a larger or a different role?
Short Term Succession PlanningWho needs immediate replacements?Whose professional career demands relocation?Who would like to choose other volunteer options?
www.vivekmehrotra.com
Department (A)Key Position (1)Key Position (2)
Department (B)Key Position (1)Key Position (2)
Department (C)Key Position (1)Key Position (2)
Current / Future Competencies and expected vacancies
Assessment & Evaluation to identify Hi-Pos
Profiling of Prospective Leaders
Individual development plans/Job rotation/Simulation workshops
Independent Assignment
Assessment of individual’s competency and skill gaps
Bottom - up Succession Planning
www.vivekmehrotra.com
Understand organization's long term goals & objectives
Determine Critical Positions
Assess individual’s competency and identify skill gaps
Identify current and future competencies for positions
Identify expected vacancies
Evaluate potential candidates as successor for key positions
Determine the individual’s current performance & future potential
Design individual’s development plans
Review individual development plans to ensure needs are addressed
www.vivekmehrotra.com
Steps of Succession Planning
Follow-up
• Assist with leadership transition and development
• Develop & implement coaching and mentoring programs • Develop an evaluation plan for succession management
• Monitor progress of succession candidates
www.vivekmehrotra.com
Succession Planning @ (Talent Review and Planning) • Review of Business Strategy• Identification of Critical Roles• Stock of Talent Inventory • Identification of Potential Successor• Assess individual’s competency and identify skill gaps• Individual Development Plan in terms of
• Job Rotation• Training• Coaching• Performance Counseling
• Follow-up on individual development plans to ensure that all developmental needs are addressed
Express computer online
www.vivekmehrotra.com
Succession Planning @ (Talent Review and Planning)
Lifecycle leadership development programs
• New Leaders Program
• Wipro Leaders Program
• Business Leaders Program
• Strategic Leaders Program
www.vivekmehrotra.com
Current performance is not the sole predictor of future success
Future potential is a sign of prospective results
Performance V/s. Potential
www.vivekmehrotra.com
Performance
Performance is an assessment of Hi-Po’s
• Past Business results• Past Performance review results
Identifies mainly the areas of low performance/weakness • Build a poor image of the employee• Minimal level of performance from Hi-Pos’ leading to
• Wasted resources• Low morale• Unsatisfactory performance• Higher degrees of employee turnover
PotentialV/s.
www.vivekmehrotra.com
Potential is an assessment of Hi-Po’s
Willingness to perform
Open-mindedness
Personal Accountability
Willingness to learn from successes & failures
Performance V/s. Potential
www.vivekmehrotra.com
“Future work potential is based on accumulated skills
and experience as evidenced by past achievement,
ability to learn new skills and willingness to tackle
bigger, more complex or higher quality assignments.”
Charan, Drotter & Noel, The Leadership Pipeline, Jossey-Bass, SF, 2001
Performance V/s. Potential
www.vivekmehrotra.com
Performance V/s. PotentialCriteria for deciding Performance V/s. Potential mix
• Industry
• Job Profile
• Tenure
• Learning Curve
BPO, Science & Technology, IT, Media
R&D, Sales, Finance, Manufacturing
Entry Level, Middle Level, Sr. Managers
Management Trainees, Newly Promoted Managers,New Job profile
www.vivekmehrotra.com
How to assess pool of Hi-Pos:
Negative feedback Change in behavior based on the feedback or … Learning from mistakes/successes in past Hunt for new information for self development or to
improve workgroup Learning & Demonstration of new skills Development of Team mates
Performance V/s. Potential
www.vivekmehrotra.com
Performance V/s. Potential H
L H
Per
form
ance
Potential
Competent / Capable
Needs Improvement
Plan exit
Long Term employee
New employee
Misfit in the position
High Performer in current roleAble to get things doneRecognize the technical expertiseOrganize the transfer of knowledge
Performance role modelLack ability to manageDetermine career aspirations Assist in developing leadership skills
Misses performance expectations Unorganized workingIdentify if unhappy in current roleCreate development plan
Performance below expectationsRigidity in behavior Recruitment error Consider exit options
Average Performer in current roleDemonstrate desire to achieveProvide training & coaching inputsRecognize potential; offer support
Despite competence, performing lowAwareness about perf. deficit missingCounseling to understand culture Help him in setting priorities
Offer challenging stretch assignments
Offer opportunities to develop others
Jackson leadership
www.vivekmehrotra.com
Putting Success into Succession Planning
Management succession is a process and not an event
• Strong commitment of senior managers
• Process is to be owned by the line management
• Simple and tailored to unique organizational needs
• Flexible and linked with strategic business plans
• Evolved from a thorough human resources review process
• Based upon objective assessment of candidates
www.vivekmehrotra.com
Role of CEO & Senior Executives in Succession Planning
Culture of coaching and mentorship
Focus on the company's competitive advantage and sustainable growth
To withdraw from the key roles for short or even medium-term periods
To take corrective steps in case of gaps arising due to their withdrawal
www.vivekmehrotra.com
Role of CEO & Senior executives in Succession Planning
CEO is a dispensable resource
" Take a bucket and fill it with water,
Put your hand in it right up to the wrist,
Pull it out and the hole that's remaining
Is a measure of how you will be missed"
"Indispensable Man"
Bryan Hattingh
www.vivekmehrotra.com
How to measure the effectiveness of the Succession Planning
The number of senior positions filled internally
The overall retention figure
The leadership talent created and provided to
the industry
www.vivekmehrotra.com
Succession Planning - Check list
Within x months, assessment for all key departments and positions will be completed
Within x months, developmental plan for all Hi-Pos will be completed
By year 20xx, increase in job rotation of Hi-Pos’ by x%
By year 20xx, increase in Hi-Pos’ leaders by x%
Over x years, increase in Hi-Pos’ retention by x%
www.exceptionalleadership.com
www.vivekmehrotra.com
Conclusion Succession Planning is as critical as creating a business
strategy Succession Planning is as important as running the
business profitably While identifying successors appropriate weightage needs
to be given to both performance and potential For an effective implementation of Succession Planning
involvement of CEO and line managers is a must Measuring the effectiveness of a succession planning
program is as critical as its implementation
Washout visual – Courtesy TOI
www.vivekmehrotra.com
Thank You
Visual – Courtesy TOI