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Succession Planning Throughout Your Organization

June 20, 2018

Succession planning is an issue that can determine the very future of your firm, yet it doesn’t always get the attention it deserves. When done right, it’s a lengthy, involved process; however, it helps firms of all shapes and sizes maintain business continuity and productivity no matter what happens with staff.

Holistic succession planning should impact every level of an organization. Recruiting strong employees, developing their abilities and preparing them for career advancement should ensure an organization has a bench of qualified employees for any role.

“If you don’t have a good succession plan, the business continuity isn’t there,” said VSCPA member Libby Dishner, director of operations at Richmond firm WellsColeman. “I’m always asking folks, ‘Who’s your successor?’ If you want to get promoted, you have to know who on your team can step into your shoes.”

Successful succession planning requires an intimate knowledge of one’s own company and/or department, along with the perspective necessary to determine where organizational needs lie. It can be helpful to engage a consultant to help identify those needs.

The best-prepared companies enter the process with a wealth of data at their fingertips. Using that data, both quantitative (financial indicators) and qualitative (job descriptions), can help identify gaps and possible successors before needs arise. But many organizations aren’t taking advantage of the information they have at their fingertips.

“They don’t put effort into the planning,” Dishner said. “There’s so much rich data that could be used for succession — performance management, looking at skills, if they’ve got a job description — just identifying what’s needed from a skills perspective and airing that with performance. They’re not using the data that they already have.”

For accountants, it’s often easier to assess technical skills than the leadership qualities that take on outsized importance higher up the org chart. It’s difficult to identify the core competencies surrounding leadership skills, much less pin down and assess those skills.

“Most people know their technical skills really, really well,” Dishner said. “I help them analyze their technical skill and do the gap analysis for that, but I often help in terms of the other skills. If it’s a leadership position, I help them understand their competencies around their leadership talent. People don’t have good analysis of non-technical skills like leadership.”

An in-depth gap analysis will help identify areas where your team or organization would be deficient in an area if a person left. The process will help identify which internal candidates would be a good fit for a promotion and where it might be necessary to hire externally instead of promoting from within.

That leads, of course, to more planning. If internal candidates can fill needs, they’ll need training and experience in similar situations to get them ready. If an external hire is necessary, there can still be opportunities to shift responsibilities between existing staff.

One major key, however, is to get the process started well in advance of the actual need.

It can’t be, ‘Oh, by the way, I’m retiring and I’m introducing you to the new partner who’s going to take over the relationship,’” Dishner said. “It needs to be, ‘You know Jonathan, He’s been to meetings. He’s worked on your account. You know him.’ When you’re transitioning that partner, it’s, ‘Oh, sure, that makes sense. Then when you retire, he already has a relationship.’”

One key to successful succession planning is getting the right people in position to move the process forward. A sponsor or champion from senior management is a must. The CEO or managing partner doesn’t need to do the grunt work in the process, but they must be visibly and officially behind it. The analysis should be delegated to a representative from human resources who knows the personnel in question more intimately.

The succession planning process can be easier to accomplish for small organizations, which know their personnel much more intimately. Larger organizations must rely on more fragmented information from trusted sources in individual departments.

The other side of the coin is that larger organizations have a greater pool of employees to fill a need. It just takes some creative thinking to picture cross-departmental role changes.

“Somebody who, perhaps, is in a different department or doesn’t work with you as closely might be the best fit for the role, but you don’t have intimate knowledge of them,” Dishner said.


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