What type of leaders will you need to support your organization’s future and longevity? How many will you need for various key positions? Where’s the talent in the organization that can be accelerated to meet succession demands? These are key questions that need to be answered when you develop and implement succession management solutions. The answers to these questions are relevant as long as they take into consideration the business strategy and objectives that leaders have to meet, the growth or diversification that the organization will face, and the current state of the talent compared to what will be required. Determining the required leadership succession plan must take into account the anticipated changes in the business environment and strategy.
Identifying high potentials, diagnosing their development needs, and prescribing development solutions to accelerate their growth are all succession management steps that are coloured by the business landscape.
While perhaps slightly exaggerated but with a kernel of truth, it has often been said that the wallet governs behaviour. This observation is particularly true for management positions with a healthy distribution of variable compensation such as bonuses, commission, and stock options. Variable compensation must align with the business objectives in order for those objectives to be met. If a corporation wants to improve the quality of service and post-sales follow-up but links variable compensation solely to increasing sales, it’s quite likely that the desired business objectives won’t be met. It’s easy to draw up a list of multiple factors that influence behaviour, such as affinity with a position, organizational climate, the boss’ behaviour, and so on. Yet we must not delude ourselves: the behaviour of many leaders and professionals is influenced by compensation. Aligning compensation with the business strategies and the individuals’ objectives is not a luxury but a necessity.
Business leaders today are kept awake by factors as varied as production and shipping costs, global competition, political and economic policies, competing for space in the minds of over-stimulated consumers, emerging technologies, and changing regulations. In order for the HR department to earn a seat at the boardroom table and effectively partner with managers in creating and supporting the organization, HR must be in lockstep with these challenges and understand the external and internal environment. Add to the mix the approaching shift in demographics, shrinking labour markets, and an aging workforce, and HR truly must be on top of its game.
Thomas Friedman says that when he was growing up, his mother told him: “Finish your dinner. People in China are starving.” Today, he tells his daughters: “Finish your homework. People in China and India are starving for your jobs!”