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Ask an FEI researcher about... succession planning. (Resources).

An FEI member asked about succession planning best practices and organizations that work with companies to develop the right successors.

"Succession Planning: Putting an Organization's Knowledge To Work," an article by Kevin Butler and Dona E. Roche-Tarry that appeared in the February 2002 issue of Nature Biotechnology, describes succession planning as an "ongoing, dynamic process that helps an organization to align its business goals and its human capital needs."

The authors say succession planning: addresses the needs of the organization as senior management ages; helps an organization prepare for an unexpected event; and ensures that an organization has the right personnel to function at peak efficiency.

Planning serves to create an organizational hierarchy and helps organizations conduct an inventory of human capital and better understand gaps, the authors say. They cite as an example the military, where succession is planned from the highest through the lowest levels. The article details four steps "that lead through design, development and implementation of the succession plan."

These include:

1. Identify existing competencies, related to both its leadership needs and the industry.

2. Evaluate and assess current employees to determine how they match up to organizational needs.

3. Introduce coaching, mentoring, training and recruiting methods that match personnel requirements -- and future needs.

4. Develop the actual plan.

The article is available through a search at www.nature.com.

An article, "The Strategy of Succession Planning," by M. Dana Baldwin of the Center for Simplified Strategic Planning (www.businessknowhow.com/manage/successplan.htm), provides questions to consider when implementing a succession plan. Among them:

* What is your company's long-term direction? Do you have an effective strategic plan guiding your course and direction?

* What key areas require continuity and development of the people resources within your company?

* Who are the key people you want to develop and nurture for the future?

* How does the concept of succession planning fit into your strategies? Are you concentrating efforts in areas where the returns will be highest?

* What career paths should your most talented people be following? Is each customized to fit the abilities and talents of the people involved?

Baldwin advises that company plans should be proactive, not reactive. People should be rotated into different areas for experience and training before they are needed in critical positions. By waiting for openings, a company may be forced to find appropriate candidates at the last second.

In another research study, "Whose Business is it Anyway? Smart Strategies for Ownership Succession," PricewaterhouseCoopers LLP documents how more than 300 private business owners completed the sale or transfer of their businesses. It also features commentary from PwC partners who have assisted hundreds of clients through business transitions.

The study is based on the 1998 PwC Business Succession Study, a joint project with Randolph Case, a professor of strategic management at Boston College. For information, contact a PwC partner or go to www.pwcglobal.com.

"Best Practices in Career Path Definition and Succession Planning," a report from Best Practices LLC (available through a seaarch at www.benchmarkingreports.com), provides the following key findings:

* Spread responsibility and ownership for career path definition and succession planning process design, execution and refinement.

* Select a set of key leadership criteria and provide an outstanding development process, aligned with corporate culture, to help leaders meet requirements for advancement.

* Screen effectively to identify high potentials and concentrate development resources on future leaders.

* Measure the results of career path and succession planning processed for individuals and the corporation to ensure alignment with goals.

* Educate employees about career planning and development opportunities to ensure communication about career options.

The study provides sample practices and performance metrics tools from several companies, and provides "process maps" representing key business processes. A free download can be obtained by providing contact information; the full study costs $2,000.
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Article Details
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Author:Graziano, Cheryl de Mesa
Publication:Financial Executive
Article Type:Brief Article
Geographic Code:1USA
Date:Sep 1, 2002
Words:632
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