Implementing an Effective Succession Plan

Implementing an Effective Succession Plan

The succession process is a common challenge across all industries and for small and large businesses alike. When navigated successfully, a thorough, intentional leadership handoff can help carry a company seamlessly through transition. But if no process is in place, shifts in leadership can create chaos, even challenging the existence of the business itself.

Some leadership changes are deliberate and come about in times of strong culture and financial success, while other transitions may be necessary due to a dip in performance or a problematic organizational structure. Both instances, however, prove the value of approaching succession planning as a continuous process, encouraging company leaders to always have a succession strategy in place for key positions.

For our Texas-based engineering consulting and program management firm, Raba Kistner, the recent shift in leadership had added significance: It was the first time in the organization’s 52 years of operation that the top leadership had not been related to the original CEO and cofounder, Dr. Carl Raba. Not only did the title of CEO shift from Gary Raba to me, but a handful of high-profile moves of executive team members associated with planned retirements occurred and were announced externally at the same time. This was the result of years of intentional succession planning to ultimately position the firm for continued growth in Texas and beyond.

What we have found is that whether a shift in leadership is necessary and sudden or, as in our case, a well-planned part of the continuity of the business, business leaders should be open to change. On the basis of our experience, below are three recommendations to consider when developing a succession plan.

Know what you’re looking for

Succession planning begins with identifying specific positions, typically executive and C-suite roles, and developing detailed job descriptions for the roles. At Raba Kistner, with the assistance of an outside consultant who specializes in succession planning, we created a performance model for key positions. For each one, we outlined the skills, requirements, and experience needed to perform the role successfully. Our performance model includes not only business skills and industry experience, but also people and relational skills.

We started with the position, not the personnel. Once we have a vision for the position, we consider candidates and perform a “gap analysis” for each candidate, centered on two categories of required skills: minimum and superior. Ideally, we would have someone internally who is a fit for the position. However, if that isn’t the case, we make the decision to hire externally. With our current CFO about to retire, this was the case for that role: The gap between internal personnel, who were valuable employees and great people, and the minimum required skill sets for our desired CFO was too large. 

When choosing to promote from within the organization, the performance model also serves as a tool to identify where the selected individual needs to concentrate on future training and development to ensure readiness for the new role.

Consider multiple opinions

Changes to any executive leadership team should be deliberate, and part of a thorough process that includes feedback from key players within the organization. Businesses should keep in mind that the nature of the move and current condition of the company will impact this process and who is involved. We begin by seeking feedback from the internal team by asking candidates to rate themselves, and then by asking for additional input from peers and executives. Participation in this type of analysis is key to the decision-making process.   

We also recommend hiring an outside consultant who specializes in succession planning to lead and administer the program and limit potential bias toward internal candidates. Particularly for a family business or an organization that has seen minimal change over the years, it can be helpful to gather insight from a third-party source. In our case, we utilized Linda Petchenik with GrowthLines, Inc. She not only helped guide us through the process—she kept us honest.     

Allow time for transition

A transition period during which the incoming candidate can work with the outgoing leader gives the organization time to process and prepare for change. Not everyone relishes the idea of working with their predecessor or their successor, but during succession planning, you have to check your egos at the door. In the case of Raba Kistner, I welcomed Gary’s willingness to stay with the firm as our Strategic Growth Officer, as I knew it would benefit both me and the company as a whole, as well as further help our goal of providing a seamless transition for our employees and clients. This may not be possible in all circumstances, but organizations should incorporate overlap time into their succession plan whenever possible.

Our employees are our top priority, and it was important for us to communicate the plan internally before sharing elsewhere; this was another benefit of building in a transition period. There were several months during which our team knew of the change to come and were able to witness the amicable working relationship between me and Gary firsthand. This positive approach to a unified leadership team helps obtain buy-in from employees, strengthens culture, and aids in reducing employee concerns about upcoming changes and business continuity. 

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While each organization and circumstance is different, a well-developed, strategic succession plan that is routinely updated can serve as a framework for not only the expected future of a company but also for any unforeseen personnel changes that may happen along the way. If succession planning is not a continuous process, time can be your worst enemy. But if you do succession planning properly, time is your friend.

Chris Shultz

Chris L. Schultz, PE, PMP, is president of Raba Kistner, Inc., a premier engineering consulting and program management firm based in San Antonio, Texas.

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