How To Sell Succession Planning To Your CEO
It should come as no surprise that a successful Succession Planning Process demands an engaged and supportive CEO. In fact, we will not deliver our Succession Planning Launch Series unless the CEO is in the room for both sessions. Without CEO support, succession plans often fails to gain enough attention, resources, or priority to truly benefit your organization. With this in mind, we thought we’d discuss a few reasons why your CEO might be a roadblock to a mature Succession Planning process, and some solutions to address each challenge.
As we discussed in previous videos, succession planning requires the engagement of your CEO. Without the support, succession initiatives fail to gain the attention, resources, or priority needed to be effective. Today, we are going to discuss some common reasons why CEOs stand in the way of succession planning, and some solutions to address these challenges.
First, some CEOs do not see the value of succession planning. They may express worry that it will be too difficult or provide a distraction from day to day tasks. Not only does this indicate that the CEO does not value succession planning, but also that they may fail to recognize the risk associated with not having a plan in place. The best way to address this issue is to make it real. Showing your CEO the urgent need for succession planning by having them complete our quick At-A-Glance Org Chart. This visual tool can help you to identify two things. First, areas where you are at risk of personnel loss. And second, a lack of replacement readiness in your company. Show your CEO where your company is most vulnerable to highlight the importance of having a robust plan in place.
Next, some CEOs are hesitant to engage in formal succession planning because they believe they have the process under control. This typically takes the form of having someone in mind for critical roles. This informal method is called replacement planning, which can be seen as unfair and based on favoritism rather than on objective decision making. To turn a replacement plan into a succession plan, complete our Audio Engaging in Succession Planning Checklist. Drive home to your CEO that replacement planning is hard on employee morale, reduces transparency in decision making, and fails to provide development opportunities for promising employees. Challenge your leader to think outside the replacement plan by considering who would fill a critical role if the incumbent and their top replacement choice were to leave tomorrow.
Finally, even CEOs who understand the value of succession planning can hesitate to actually enact one in their company. As with any long-term strategic process, succession planning can be intimidating to begin, and some CEOs feel that all the responsibility of creating a plan will fall onto their shoulders. Help your CEO out by presenting them with a user-friendly but robust process, such as SIGMA’s Simple Succession Plan. Consider partnering with an experienced external consultant. Succession planning is not something a CEO needs to go through alone, and the right consultant can help you through any stage of the process. By leveraging our At-A-Glance Org Chart and Audio Engaging in Succession Planning Checklist, you can begin to gain your CEOs buy-in for succession. For more valuable resources, visit us at sigmasuccession.com or contact us today.
They Don’t See the Value of Succession Planning
Evidence of this will often be communicated through a never-ending list of reasons to postpone Succession Planning, including:
- the perception that succession will distract from day to day priorities,
- the worry that succession planning is too complicated,
- concerns that a full succession plan will take too much time, and
- the belief that succession planning will cost too much money.
Let’s forget for a minute that our Succession Planning Launch Series negates all of these concerns. Having these concerns in the first place demonstrates that the CEO simply does not understand the value of a Succession Plan, let alone the risks involved with not having one.
Demonstrate The Value of Succession Planning
Simply put…make it real.
Although there are many definitions of succession planning, one of the most effective approaches to gaining understanding and buy-in from your CEO is to demonstrate the need. Have them complete our At-A-Glance Succession Bench Tool for a quick way to identify the strength of your bench (i.e. how ready are those that are next in line) along with the organization’s exposure to turnover at the leadership level. Identifying areas of highest risk is a simple way to start having meaningful discussions around “what would happen if ______ left tomorrow?”.
CEO Believes They Have Succession Under Control
When asked about their succession planning process, many CEOs think they’re on track if they have someone in mind for each leadership role. More often than not, the ‘someone in mind’ was simply the result of the successor’s long-term relationship with the incumbent. This model is a form of replacement planning, and obviously lacks any kind of a formal process for identifying the most qualified candidate. This approach, although common, undermines any perception of fairness and transparency.
Demonstrate the difference between replacement planning and succession planning
Work through our Are You Engaging in Succession Planning checklist with your CEO. Help them understand that replacement planning makes it difficult for employees to predict if they are being considered for promotion, and when that promotion may be expected. As such, it may be difficult to retain talented individuals looking to advance. Replacement hiring also does not inherently plan for employees to develop their skills or enhance their abilities, making it difficult to grow talented employees in the first place. Without the long-term approach of succession planning, candidates may not be ready to take on the position they are given in replacement hiring, resulting in potential costs and delays for the organization as the new leader learns the ropes of their role.
CEO Believes They Are Permanent
The fact that your CEO will leave their role is inevitable. However, for many, it can be difficult to imagine that day. Some CEOs, whether new to the executive role or not, may be years away from the thought of retirement. Their intention to remain with the organization may bias them away from engaging in long-term succession planning. As a result, years go by without a plan in place for their CEO and, most commonly, without a plan for any of the senior leadership team members.
Succession Planning Focuses on The Entire Management Team
It can be difficult for an individual to accept and plan for the eventual day when they will no longer be around to lead the company. Instead of trying to convince your CEO to exclusively plan for their role, talk to your CEO about introducing a Succession Plan for your entire senior leadership team. Discuss the impact it would have on the CEO if one of their VPs were to leave tomorrow. Uncover the critical roles in your organization, and frame succession planning as a tool to ensure the entire senior leadership team, CEO included, is protected from the ripple effects of any sudden retirements or personnel changes.
Highlight the Long-Term Positive Impact
Even leaders who are aware their role will one day be assumed by others have a difficult time reflecting on this fact. Often, a CEO’s identity is tied to their role as an executive leader and their corresponding place in the organization. Additionally, with some being founders or being directly responsible for the organization’s growth over multiple decades, it is easy to understand the emotional connection. A lack of planning can lead to a sudden senior management vacancy, or to a leader hanging on to their role a little too long.
The key factor in addressing this challenge is to focus on how the CEO’s leadership, knowledge, and mentorship is central to the execution of a succession initiative. Succession planning is not an effort to push your CEO out, but a method to ensure they have an opportunity to shape the future leaders of the organization. A tangible way to do this is to involve them in building a Success Profile for their role.
They Don’t Know Where to Begin
You may have a CEO that understands the value and sees a need for succession planning, but feels their time is consumed with too many other tasks to take it on. They may also be hesitant to spend time on succession planning if they don’t know where to begin. Over time, succession planning can begin to feel like a burden, one that the CEO wants to take care of, but finds overwhelming or confusing. It’s natural to focus our attention on tasks that see immediate results or allow us to exercise our strengths, but this can lead to the neglect of other important duties, such as planning for the long-term stability of the company.
Offer a Succession Planning Process
While CEO buy-in is essential for the success of your succession plan, all the research into developing a plan shouldn’t fall on the shoulders of your leader. Present them with a simple process, such as SIGMA’s Sample Succession Planning Process. Consider using an experienced succession consultant, who can offer succession workshops, templates, and resources to guide your process.
Succession planning is an important tool in the long-term stability of your organization, and your company doesn’t need to go through it alone.
Engage Your CEO With Professional Succession Planning
Among the many benefits of using SIGMA is our ability to help engage your CEO. More specifically, our Succession Planning Launch Series can help get their buy-in through a unique and practical format. In 30 days and with less than 8 hours from your leadership team, the Succession Planning Launch Series delivers a comprehensive full-year Succession Plan customized for each member of your executive team. It is simply the best way to prove the value of succession to your entire executive team and finally get a personalized plan in place.