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Navigating the Ins and Outs of Executive SuccessionEric Beaudan – Odgers Berndtson

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Succession Planning is Tough Work…

Does your plan include these key

elements?Does your organization have

a succession plan in place to

replace today’s senior

executives?

Source: Odgers Berndtson Canadian Executive

Leadership Survey, 2013

What do the Stats Tell us…?

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Fewer Leaders are “Ready Now”

8%

25%

59%

8%...are ready now to take on senior executive responsibilities

...will need 2 or 3 more years of mentoring before they are ready to take on senior executive responsibilities

...will need 5 or more years of mentoring before they are ready to take on senior executive responsibilities

None of these options apply

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3 Approaches to Succession

Tight Script

Hail Mary

Laissez Faire

Leaders come and go –you can’t control it

Future leaders will naturally emerge as new challenges arise

Identify clear successors for key roles

Internal candidates compete in what is essentially a “horse race”

Wait until CEO or key roles become vacant

Lob in internal or external talent

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What Top Global Companies Do

Best Practice in Succession Planning & Development Global Top Companies

All Other

Development of high potential pool 100% 84%

Assessment of leadership skill gaps 100% 78%

Clear identification of critical roles for future success 100% 72%

Development of successors for specific positions 96% 75%

Identify leader’s current performance vs future potential 96% 73%

Ready now vs ready future rating 88% 72%

360-degree feedback 84% 66%

Communication of accelerated development plans 80% 58%

Source: Aon Hewitt

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Development Strategies: Digging Further

Source: Odgers Berndtson Canadian Executive Leadership

Survey, October 2012

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Getting the Process Right

Well defined succession objectives:

Assess the leadership potential of internal leaders, and work with each individual, the Board and the CEO to create a development track that will, over time, maximize individual readiness to take on more senior roles.

Provide a meaningful leadership development experience for leaders who will participate in the process, and challenge their willingness to step outside their day-to-day thinking in order to tackle emerging business challenges and opportunities.

Identify up to 3 CEO successors who will be ready to take on the CEO role within 2 to 5 years, and create accelerated development plans for these leaders.

1. ANALYSIS

2. ASSESSMENT3. DEVELOPMENT

4. TRANSITION

Develop evaluation questionnaire

Interview key stakeholders

Create CEO capabilities matrix

Identify development goals and projects foreach potential successor

Monitor individual progress, provide supportand coaching

If required, conduct full external search

Appoint successful candidate

Accelerate executive team alignment

Candidates complete Hogan instruments

LeaderFit assessment ofeach candidate (incl. 360)

Individual feedback andBoard review

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Tip 1: Start with the Big Picture

Succession planning and development

is a great opportunity to think about

the types of leaders you will need to

tackle future business challenges and

evolve your organization culture.

Individual leadership & development implications

Organization culture and

design implications

Expected challenges,

opportunities and key

differentiators

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Tip 2: Have the Tough Conversations

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Four Essential Characteristics

INTEGRITY

JUDGMENT

COMPETENCE

VISION

STEP 1: Defining Leadership Capabilities

Business Challenges & Opportunities

GLOBALIZATION

COMPETITIVE TRENDS

TECHNOLOGY, CYBER

GOVERNMENT

REGULATIONS

STEP 1: Sample Leadership Requirements

Stakeholder Management:

Work with the Board, employees and stakeholders to ensure acceptance and support for XYZ’s long-term vision.

Build trust and manage relationships with external stakeholders (federal, provincial, municipal governments, customers, tenants andprovincial associations).

Build XYZ’s social license with local communities.

Execution Savvy:

Understand the complexity of leading capital development projects and dealing with the requirements of transportation and energyindustry.

Focus the organization on execution of five-year plans, large-scale project management and process improvements.

Resolve potential conflicts with partners and stakeholders.

Make timely decisions while balancing the organization’s long-term needs with the reality on the ground.

Resilience and Adaptability:

Engaging and articulate communicator.

Approachable, self-aware, open and transparent.

Composed, stable and able to respond to crises and new developments.

Politically astute, diplomatic, empathetic and able to balance sense of business with finesse in managing issues and relationships.

People and Team Development:

Lead and develop an effective, credible senior leadership team.

Delegate effectively, create positive atmosphere focused on growth and development.

Ensure that all employees are motivated to contribute fully to the realization of the organization’s vision and objectives.

Strategic Clarity:

Address strategic implications of increased trans-Canada trade within the context of XYZ’s vision to be a major contributor to Canada’s economic growth through international trade.

Leverage knowledge base and experience to ensure ongoing success and champion amalgamation initiatives.

Balance commercial interests with commitment to social, environmental and political issues.

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STEP 2: Assessment Methodology

Identify leadership requirements for role.

Understand company culture and direction.

Map requirements to leadership assessment tools.

Completion of assessment instruments (eg Hogan).

Assessment questionnaire and structured interview.

360 references (boss, peers, direct reports, stakeholders).

Psychometric results (leadership tendencies, derailers, values).

Custom assessment report.

Comparative assessment of executives.

UPFRONT ANALYSIS

ASSESSMENT

REPORT

DEBRIEF

When assessing internal candidates, regardless of the tools you use, it is

critical to ensure that the assessment yields information that allows leaders

to gain strategic self-awareness and develop concrete development plans:

Individual debrief.

Development plan (with CEO/Board inputs).

Optional: on-going coaching and online 360 follow up

STEP 2: Sample Assessment Summary (OB)

Leadership Strengths:• Strategic Clarity: represents the

organization well, believes in XYZ mandate and politically savvy

• Stakeholder Management: builds strong relationships with stakeholders and customers, perceived as “quietly confident”

• Team player – non confrontational, learning and people oriented

Development Needs:• Influencing Skills: he can at times avoid

confrontations and is not always seen as a strong influencer with peers and with the Board

• Team Development: he will on occasion need to set high expectations with his team and hold people accountable

• He can get too closely involved in managing the details, which can result in slow decision making

LEADERFIT ASSESSMENT RATINGS- JOHN SWEETDEVELOPING PROFICIENT STRONG OUTSTANDING

Strategic Clarity

Execution Savvy

Resilience & Adaptability

Stakeholder Management

People and Team

Overall LeaderFit Potential

Development Goals

Specific Behaviors and Actions Required-

Areas of Focus for Development

Coaching and Learning Plan Measures of Success

Development Goal #1

Develop strategies to

work in conjunction with

the Executive Leadership

Team, sharing goals and

ownership of

responsibilities to

entrench client centric

culture

STOP:

Thinking that you need to shoulder

all of the responsibility yourself

Communicating excessively in

writing

START:

Seek advice and counsel from ELT

on progress on a major initiative

Focus on efforts to work more with

and support other ELT members

1. Identify 2 major operational initiatives

requiring ELT support

2. Identify 3 team centric shared goals and

values to support high performance

leadership culture and track adherence

3. Determine how and the extent to which

this leadership behavior is filtering down

to senior managers and beyond

Increased level of employees’

confidence in the ELT’s ability to

achieve transformation

Increased level of employee

engagement scores

Increased level of open and candid

dialogue at the ELT level

Development Goal #2

Practice and encourage

others to seek and

provide regular and

unsolicited feedback to

ELT members, direct

reports and staff to

elevate organizational

performance

STOP:

Working in a task vacuum

Assuming others know or prefer to

figure it out by themselves

START:

Communicating on a more

spontaneous basis

Realizing that others are in need of

your knowledge, expertise and

moral support

1. Setting daily targets with regards to

providing or collecting input from others

2. Identify 2 individuals who show promise

and track coaching and mentoring activity

and progress

3. Institute an active 2 way communication

culture within the ELT and with direct

reports

Perception of increased personal

and professional accessibility

Improved scores on 360’s and

organizational scans

More effective succession planning

Development Goal #3

STEP 3: Sample Development Plan

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STEP 4: Onboarding Plan

12 Month Overview of Onboarding Challenges & Coaching Focus

““The reputation of a thousand years may be determined by the conduct of one hour.” –Japanese proverb

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Tip 3: Manage the Dynamics

Assess the leadership potential of internal leaders, and work with each individual, the Board and the CEO to create a development track that will, over time, maximize individual readiness to take on more senior roles.

To be successful, succession planning and management needs to be an on-going topic for formal discussions at the senior team and Board levels, reinforced by concrete process and development plans.

It’s tough, but possible, to avoid the “winners” and “losers” syndrome as a result of succession.

As an HR partner, be prepared for the unexpected: strengths and derailers will be exacerbated as people jostle for key roles.

Pay extreme attention to what and how you communicate internally and externally: everyone is watching you!

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CREATIVE EXECUTION WHAT GREAT LEADERS DO TO UNLEASH BOLD THINKING AND INNOVATION

Eric Beaudan, Global Leadership Practice Director at Odgers Berndtson published his book Creative Execution through Wiley in 2012 .

The book highlights the leadership practices of highly successful companies such as the Four Seasons, Toyota and Google.

Book Signing TODAY!

Time: 2:00 PM

Location: The bookstore is located at the very back of the tradeshow hall (Hall E).

Please join us today for a book signing with Eric Beaudan, Author of Creative Execution.

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ERIC BEAUDAN

Leadership Practice Director | Odgers Berndtson

200 Bay Street, Suite 3150,Royal Bank Plaza South Tower Toronto, ON M5J 2J3

416-366-1990 ext. 358eric.beaudan@odgerberndtson.cawww.odgersberndtson.ca

Thank You!