Despite the devastating impact a sudden departure can have on a company, 46% of UK businesses don’t have a good succession plan in place, according to a new study among senior directors by executive search and interim management specialists, Norrie Johnston Recruitment (NJR).
The research, among 127 senior directors in UK companies, found that even in companies where succession has been thought about, the plans are patchy, with certain senior roles ignored. Most plans (53%) consider what would happen if the finance director suddenly left, followed by the CEO, (51%), with the sales and operations director roles included in 49% of plans. However, most completely overlook certain roles. For instance, only 19% of plans consider the chairman, 20% IT director, 33% marketing director and 35% HR director. Furthermore, many plans stop with the board, over a third do not consider senior managers at all.
Graham Oates, Chief Executive of Norrie Johnston Recruitment comments: “If your succession planning is all about identifying current senior managers who have the potential to fill top positions should a vacancy arise, then it makes sense to also evaluate the senior managers’ roles, to see who below them might fill their shoes, should they be promoted. Armed with this insight employees can be given additional training and mentoring, to help develop them and recruitment strategies can be put in place to plug any gaps. In this way succession planning, recruitment and leadership development can go hand in glove.”
According to the study, not many companies are this joined up in their thinking. Over half (57%) of the companies with a succession plan, don’t have a leadership development programme in place to support it and over one in ten (12%) of those that do, admit their leadership programmes are little more than some ad hoc training.
The NJR study has unearthed a few promising exceptions to the rule. Of the companies which have a leadership development programme in place to support their succession plan, 60% say this includes mentoring plus in-company assignments to stretch senior managers and develop their skills and experience. Over half (53%) say the programme also includes coaching.
“There are a few companies – around 14% overall- adopting good practice,” adds Graham Oates, “They’ve prepared for the departure of every board member and thought about their key senior managers, identified where the talent sits within their organisation and have sophisticated leadership development programmes in place to support that talent. However, they are in the minority.”
Although 90% of succession plans were thoroughly reviewed in the last year and the remainder in the last 18 months, barely half of companies who have such plans are happy with them, 41% say their plan is good as far as it goes but it probably isn’t extensive enough, and a further 8% say it’s not that useful and probably won’t be used when someone leaves.
Graham Oates concludes: “This is clearly an area which most companies are struggling with – as a result they’re either not embarking on succession planning to start with, or they’re starting the process but failing to see it through properly.”