Leading in the Future Tense: Senior Leader Transition/Succession Planning

By Brigadier General (Retired) Mark O'Neill, Sunday, January 01, 2017

You have just delivered a powerfully optimistic earnings report to your board of directors and are basking in congratulatory chatter before a celebratory dinner.  As you sit down to the table, your board chairman asks how the plan for transition of company leadership is coming along.  Remembering that the chairman asked you the same question (and not for the first time) several months earlier, you promise a briefing before the next board meeting.  Sleep comes slowly that night as you ponder how you were unable to retain focus on this critical task.  You recall responding when first asked about transition planning, quickly organizing your leadership team to conduct analysis, provide options, and produce a strategy for presentation.  Inexplicably, the months have slipped silently past, and you have not given the topic another thought.  As you finally drift off to sleep, you commit to tackling this challenge as your top priority.

You and your leadership team have already “been to this rodeo”.

Briefing the members of your leadership team (who are silently - or not so silently - thinking “here we go again”) during Monday’s business meeting, you ask for updates; assign additional responsibilities; and set a tight timeline for dialogue, processing reviews, and drafting and publishing the new company succession plan.  You acknowledge the difficulty of planning for the future when everyone’s time is consumed by the urgency of current operations and the demands of the next quarterly investor report, but you insist: “this time, we’re going to get this done.”  The fundamental question remains: if you’ve been down this path before, why are you and your organization effectively stuck on first base?  Disquietingly, you know your board is asking the same question.

Leadership succession in combat

U.S. military organizations routinely prepare their teams for predictable and unpredictable leadership transitions.  The unpredictability, urgency, and life-or-death nature of combat, as well as the size and complexity of military organizations, places a premium on the ability of senior leaders to prepare younger leaders for positions of increased responsibility, while also preparing combat teams to absorb these changes “in stride” so as to minimize the impact on unit effectiveness.  Being prepared and postured to take over your boss’ job is at the core of military culture.

Unlike military teams, your business is not engaged in daily combat, or at least not the literal variety.  Nonetheless, corporate executives have an obligation to their shareholders, boards, and, most importantly, to their employees and themselves in order to establish programs and processes that ensure continuity of mission, quality, and productivity. 

Considering the worst-case scenario

As the meeting adjourns, you place yourself in the shoes of your board chairman and ponder the worst-case scenario:  the successful President and CEO of a large and growing corporation is suddenly gone.  This brilliant, charismatic, and dynamic driver of the corporation’s impressive growth dies suddenly and unexpectedly.  Unfortunately, this executive, perhaps seeing his individual success and that of the company as being one and the same, had not established a succession plan, leaving the company’s surviving leadership team struggling to gain control of the situation while investors, board members, and employees anxiously look on.  The company is able to recover, but a catastrophe is only narrowly averted.

You turn your attention to a conversation you had with a military officer you met during a leadership off-site some months ago.  The discussion had revolved around continuity of leadership during crisis.  Although you did not see a connection at the time, the similarities between military succession of command and the challenge you now face are compelling, offering several ideas you think you can use with the board.

Three categories of succession plans:

1.     Immediate/crisis succession plan

In combat, the loss of a leader in the midst of battle demands immediate and automatic action to restore the chain of command and shift responsibility and authority to a designated subordinate.  Failure to have clear, rehearsed steps in place to maintain the chain of command can result in mission failure and the loss of other members of the team.  Briefed in mission orders and contained in unit standard operating procedures, immediate leadership succession procedures are then rehearsed during mission training exercises.  In this way, subordinate leaders are prepared to immediately assume responsibility for a lost senior, and the other members of the team are prepared to recognize the new command structure without a loss of momentum.

Similarly, a business Continuity of Operations (COOP) Plan requires written and rehearsed actions to be taken in the immediate aftermath of an unexpected leadership change.  Chief executives must identify those leaders key to the accomplishment of the organization’s mission and then designate the individual best suited by experience, talent, and location to quickly assume responsibility in their stead.  Tabletop exercises conducted during COOP rehearsals are a good way to ensure that all members of the leadership team understand the plan, their individual role in its execution, and that the corporate culture embraces the importance of leadership succession to mission accomplishment.

2.     Contingency/bridge/reset succession plan

 Following the loss of a combat leader, military organizations immediately reestablish the chain of command (immediate/crisis succession plan) based on rehearsed drills.  Once the operation is concluded and the crisis has passed, new long-term leaders will be selected to assume vacated positions in the chain of command based on experience, ability, and location.  This action, a bridge from the past leader to the post-crisis leadership team, replaces leaders who have been injured, killed, or moved to another leadership position due to leadership losses/changes in other units.  Sustained by institutional leader development programs and a culture that emphasizes sustained effectiveness of the organization and mission accomplishment, leadership succession plans in military units serve to reinforce organizational culture, ensure sustained performance, and provide well-articulated pathways for individual leader development and career advancement.

Similarly, a chief executive must continuously develop long-term leaders able to step into key roles to replace those who either depart the company for another opportunity, retirement, ill health, or death.  If part of a well-crafted succession plan, these new leaders will have been prepared for their promotion through technical education, experience, as well as executive leadership coaching and development programs.

3.     Strategic/engineered succession plan

 The need for lengthy programs to develop required complex individual and team skills and experience, as well as assimilation into unique Service organizational cultures, are characteristic of each U.S. Service.  As a result, military organizations draw virtually all of their leaders from within.  Accordingly, sophisticated leader development and promotion policies, well-resourced educational institutions, and experiential opportunities are an integral part of U.S. military culture.  A young leader beginning a career in the U.S. Army, Navy, Air Force, or Marines can choose from a wide variety of career paths based on their interest and expertise.  Each individual, if competent and possessed of the necessary character, is able to follow a well-crafted path of successively greater roles and responsibility.  For each Service, this process serves to sustain the critical components of the organization’s culture, ensures a continuous flow of well-qualified leaders for the future, and continually renews the linkage with the citizenry it serves.

Many years ago, businesses also drew primarily upon leaders developed from within the organization to fill senior vacancies as they occurred over time.  Over the past 30 years, however, many businesses have increasingly relied upon hiring external talent to fill key vacancies as they sought to maximize benefit (qualified and competent talent) while minimizing the associated costs of internal employee development and retirement compensation programs.  This approach can yield impressive results (witness the success of many Fortune 100 companies that select their CEO’s and other key leaders from outside the organization) but also serves as a pervasive reminder to the best and brightest subordinate leaders that there will be an internal upper limit to their advancement.  This all too often leads them to conclude that they should look elsewhere for promotion, precisely at the time where their experience and competence are most developed and valuable to the company.

Recently, however, some of the most successful, innovative, and admired companies have made substantial investment in the development of their young leaders with an eye toward building a succession “leadership bench.”  This decision to identify, educate, and assign the best and the brightest from within the ranks yields multiple benefits for these organizations.  Not only does the investment ensure the future vitality and effectiveness of the company, but it also serves to retain rising talent, increases the level of worker satisfaction and company effectiveness, and allows the chief executive to inculcate the components of organizational culture essential to corporation’s future growth.  As a bonus, providing leadership growth opportunity and continuous feedback to all members of the team ensures that everyone not only understands the importance of leadership to the company’s future but also helps define their place in that future.

Now, here comes the hard part

Several weeks after your encounter with the board, you and your leadership team are putting the finishing touches on your company’s succession plan.  The strategy ensures the company is able to quickly move to fill unexpected gaps in key leadership roles, provides for a logical and transparent long-term solution to leadership changes, and provides for the future leadership needs of the company, as well as the development and retention of its very best talent.  You are comfortable the plan will be well received by the board.  But sleep still comes slowly as you realize that for all the work you and your team have done, the obstacles to implementation of the succession plan are substantial.  Not relishing the prospect of another hard question from the chairman, your thoughts turn toward the practical problems ahead.

Practical steps

The problem with all strategic plans is their propensity to languish after approval.  Without the commitment of the chief executive, the succession plan presented to the board of directors will languish and calcify, slowly but inexorably consumed by the urgency of the now.  The chief executive can prevent this problem by taking a few positive actions that will significantly improve the prospect for success.

Leaders must accept the reality that they are not indispensable – and they must ensure that every other leader in the team understands this truth.

This first step is the hardest, because the very qualities that result in a successful corporate executive – keen intellect, drive, energy, confidence, and ambition – conspire to convince most humans that they, and they alone, are the keystone to organizational success.  Military units know there is no room in combat for an indispensable leader.  The enemy will attempt to eliminate that key leader in an attempt to disrupt the organization.  If the success or failure of a mission or the survival of the team’s members is contingent on one individual, then the prospects for success are unacceptably low.

Notwithstanding the importance of key leaders, in combat or in business, truly great organizations have built leadership resilience into their culture.  Truly great leaders know they make their organizations much stronger and leave a genuinely lasting legacy of their leadership by consistently communicating this fact to the members of their team.

Good leaders put a trusted leader in charge of executing the day-to-day execution of the company succession plan, while they focus on integrating the strategy into the organization’s culture.

Military commanders, like corporate executives, are responsible for everything that happens in their organization.  Good leaders, knowing that they do not possess the time or ability to directly supervise every aspect of an organization’s day-to-day operations, use deputies to keep the most important components of the enterprise operating effectively while they retain the responsibility.

A corporate executive can ensure the successful implementation of the succession plan by making this individual a key advisor in all aspects of strategic and operational planning, as well as incorporating status updates and benchmark reports into periodic leadership meetings.  Most importantly, the executive consistently communicates the importance of the plan with both the leadership team and the organization’s rank and file members.

Good leaders ensure rising stars are identified, developed, challenged, and recognized.

The executive can best influence the future course of the company by ensuring the very best young leaders in the organization are identified, developed, and given the opportunity to be challenged.

The goal is not to produce “clones” of the existing leadership but to pick the right leaders for the future.  Accordingly, the chief executive must maintain a laser focus on the effectiveness and suitability of the assessment tools and promotion processes used to identify rising talent.

The chief executive is the key senior leadership member to ensure the necessary resources are allocated to educational and developmental programs for these leaders once selected.  Further, the executive must ensure the young leader’s participation and attendance in these programs enforced as a priority.

Because other members of the leadership team are focused on executing the short-term business plan, the chief executive must play a personal role in the selection of the experiential opportunities made available to these rising stars.

Finally, the chief executive can highlight and sustain the achievements of the individuals being groomed for senior leadership succession.  Public recognition ignites powerful feelings in a rising leader’s heart when the boss singles them out for praise in the presence of their peers.  When combined with an unexpected personal, handwritten note offering encouragement and thanks for committing to the future of the company, the executive can rest assured that the succession plan crafted at the request of the board of directors will be more than a document gathering dust on a shelf.  You will have used it to produce an eventual successor worthy of you and the company you lead. 

Brigadier General Mark O’Neill

Expertise:Leadership, leader education and development, national security, leading organizational change, strategic planning, expeditionary logistics, China and East Asia.Experience:Mark is a tested leader with extensive domestic and international experience in military, diplomatic, and corporate arenas. During a thirty-year career in the United States Army, he led military units ranging in size... Read More +

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