Succession Planning & HR Strategy

Many organisations take their most vital resource for granted – their Human Resource. Not enough attention is given to this essential resource and organisations often fail to link human resources to corporate strategy. An effective human resource strategy will align itself with the corporate strategy; and be a core contributor to ensuring continuous improvement and sustainable growth.

In a 2008 survey by Ernest & Young, executives from 150 Fortune 1000 companies agreed that human resource issues ranked among the top five business issues impacting on an organisations performance and their results. Yet, staggeringly, 41% of executives surveyed admitted to only reviewing these human resource related risks on, at best, an ad hoc basis and in some cases not at all, (Steffee, S, 2008, p.14)

The survey identified the top five human resource ‘risk’ areas that have a significant impact on organisational performance as being;

Talent Management and Succession Planning
Ethics
Regulatory Compliance
Pay and Performance Alignment
Employee Training and Development

One of the key principles of human resource development (and organisational performance) is succession planning – this key business component, if utilised correctly, can add significant value to an organisations future growth and can be a significant competitive advantage – but only if implemented correctly. Unfortunately, as with many business principles, it isn’t succession planning that has failed organisations, but organisations that have failed to understand and implement succession planning correctly.

Gaffney (2005) highlights two key points, firstly that career development and succession planning go hand in hand; and secondly, that a synergy between career development and succession planning helps create happier and more productive employees, (p.7).

Matching career aspirations with succession requirements is the ultimate goal for any employee and their organisation – but it has to be developed and managed properly from the outset. Organisations need to have an open and honest culture and employees need to be fully aware of their strengths and weaknesses and not have unrealistic expectations.

For succession planning to be successful, your organisation will need to have the following in place;

1. A well thought out corporate strategy, implementation plan and corporate vision;

2. A HR strategy and a manpower plan that link directly to the corporate strategy;

3. Communication and transparency, vertically and horizontally; such that the ‘whole’ organisation understands the future strategy; and employees are aware how they contribute to the organisations success, the implications for their current role and their future opportunities;

4. A qualitative and quantitative method for skills and talent management;

5. An effective method for identifying and communicating with all employees about career aspirations and succession opportunities/requirements;

6. Strategic leaders who fully understand the impact the human resource has on organisational performance and who fully support the HR function;

7. A mechanism for regular strategic review and succession feedback;

8. An organisation that is flexible to change; and

9. An organisational culture that embraces best practices and thrives on innovation, at all levels.

Finally it’s worth remembering a quote from Andrew and Valerie Stewart, who remind us that, “the relationship between performance and potential is not a simple one. The best performers are not necessarily those of high potential.
Promotion solely on the basis of past performance inevitably leads to promotion to the person’s level of incompetence.”

References

Gaffney, S. (2005). Career Development as a Retention and Succession Planning Tool. Journal of Quality & Participation, Vol. 28, Issue 3, p.7-10.

Steffee, S. (2008). HR Risks Are Largely Ignored. Internal Auditor, Vol. 65, Issue 6, p.14-15.

Developing a 'Winning' Business Team

Business teams, regardless of whether they are top teams, management teams or departmental/project teams, almost always have room for improvement that often goes unnoticed or unchallenged by those involved. As Herb, Leslie and Price (2001) correctly summarised, “a poorly performing team breeds competing agendas and turf politics; a high-performing one, organisational coherence and focus.”

In many organisations teamwork appears to be viewed as less important than individual performance - which is encourage by rewarding individual performance much more than team performance. This leads to a general acceptance that teamwork is likely to be dysfunctional, so let’s just accept it, moan about it over coffee and do very little to fix the problem.

Sports teams know that to be a ‘winning’ team they have to work together as a cohesive unit; they need to understand and support each others strengths and weaknesses; and they have to perform at the highest level, game after game (and that a single good performance doesn’t equal success). Not only do they need to perform each game, but they accept that they need to improve their performance game after game, if they are going to ‘compete’ at the highest level.

Further, winning sports teams know that it’s not about a collection of the most expensive players that makes them the best, but it’s about having a group of talented people who can work together ensuring success after success; and even after a bad performance bounce back immediately. These are teams focused on success.

Sports teams have the advantage that they regularly train together to improve their performance, which is mostly absent in the business team. In organisations the ‘team meeting’ is the training ground; but this is very rarely used as a training experience. How many business teams do you know that regularly review their team performance after each meeting, looking at how they could have worked better and assessing what they can do as individuals and as a team to improve their performance at the next meeting?

Business teams need to spend more time assessing their performance and identifying ways in which they can improve their team work. To support this, organisations need to set specific objectives for their business teams, which must be reviewed on a regular basis, (organisations set targets for other key influencing variables and appraise individual performance, so why not appraise team performance?)

An effective business team, like a winning sports team, will always have clearly defined goals and objectives, which will be fully owned by all the members of the team. Each member will fully understand their specific role in the team, where they add value and how they can support the team process. The team will work together as a cohesive unit focusing on the business objectives and supporting each other in the process.

Shrewd strategic leaders, like the best sports coaches, will constantly develop talent within their organisation, so they have a ‘talent pool’ that they can call on to ensure their business teams always operate at the highest and most efficient levels. These leaders know that spending time developing their business teams, at all levels, will not only improve team performance, but enhance decision making and significantly improve corporate performance.

References

Herb, E., Leslie, K. and Price, C. (2001). Teamwork at the Top. The McKinsey Quarterly. No. 2, p.32-43.

Size Doesn't Guarantee Quality

On 15th April, 2010, it was 98 years since the Titanic sank and some large corporations should remember and reflect on the comments of the captain, Edward. J. Smith, before the fateful voyage. When asked how he could best describe his, nearly, 40 years at sea, he replied, “Uneventful. I have never been in an accident and I have seen but one vessel in distress in all my years at sea. I have never seen a wreck and have never been wrecked, nor have I ever been in any predicament that threatened to end in disaster of any sort.”

In the 21st century shouldn’t the biggest and most profitable organisations be the guiding example for the rest of the business community to follow and learn from - lessons in best practice and business excellence, for example? Yet isn’t it true, in today’s corporate world, that large organisations fit into one of two extremes – there are the large organisations that exude excellence – in leadership, in customer service, job satisfaction and overall best practice.

Then, sadly, there are those large organisations, who, on the one hand are profitable, but who use their size to bully all comers and who hide their weaknesses behind corporate arrogance and denial.

It’s nothing new, “for organisations to deceive themselves is neither rare nor random. Charles Frankel, Assistant Secretary of State in President Johnsons Administration in the US (1965-67) concluded that self-deception was not simply a passing problem, but a permanent condition facing all organisations,” (Landau, M. and Chisholm, D., 1995, p.72).

Organisations, in accepting bullying and self-absorbent cultures, forget the bad influence their leaders can have on their staff, as an example, a steward on the Titanic when asked if it was true that the ship was unsinkable, replied “Madam, God himself could not sink this ship.”

So what can these organisations and leaders learn if they open their eyes to history and the Titanic?

The Titanic was warned in advance of the increase in ice and the potential for icebergs, but chose to ignore the warnings. Large organisations with poor cultures know, deep down, the impact of their arrogance but, up to now, have chosen to ignore them, enjoying the feelings of power and control – the feelings of invincibility.

After setting sail the Titanic restated its objectives and decided to attempt to beat the record for crossing the Atlantic to impress its shareholders. There was no immediate reward for beating this record (held by its sister ship) since the Titanic was receiving publicity on both sides of the Atlantic. Power and arrogance led to this decision and contributed to the upcoming disaster. Best practice organisations focus on business principles such as sustainable growth and putting the customer first; on transparency and creating cultures that lead to job satisfaction and retention at all levels – an organisation that will provide a ‘luxurious and safe passage’ for all those who embark on the journey.

Finally, the capacity of the Titanic's lifeboats was only 1,178, while the ship was built to carry 3,000 passengers and crew. There was simply no way any more than half the ship's complement would survive should the unthinkable happen. So when the tragedy occurred, only the few survived - only 705 out of about 2,220 escaped to the safety of these craft. The lessons should be self-evident, plan for all eventualities; accurately analyse, assess and manage your organisations risk.

In those large organisations that currently embrace a culture of denial and self-worth, within their ranks, it’s time for their strategic leaders to ‘step-up’ and learn some humility. Critical self-evaluation is a basic requirement of excellence in leadership – it takes courage and self-belief – and that is what will distinguish between the great leaders of tomorrows great organisations and those organisations who are wondering where the iceberg came from – and who’s the idiot who didn’t see it coming!

As Pamela Waymack states in her 2006 article, “management’s overconfidence and failure to see its own vulnerability contributed to the sinking of the Titanic. Neither historic track record nor size and prowess are a match for a market in flux. We cannot assume that our organisations are invincible. A seaworthy captain with a spotless record for 40 years was no match for this field of icebergs.” (p.41).

References

Landau, M. and Chisholm, D. (1995). The Arrogance of Optimism: Notes on Failure-Avoidance Management. Journal of Contingencies & Crisis Management, Vol 3, Issue 2, p.67-80.

Waymack, P. (2006). Managing the ice in the waters ahead: Lessons from the Titanic. HFM (Healthcare Financial Management). Vol 60, Issue 7, p.38-41.

Six Essential Steps for Effective Internal Customer Service

“In business, as in life, you can often find a multitude of reasons why you shouldn’t do certain things you know to be right. The solution is to concentrate on the one or two reasons why you should.” Nigel Brownbill

Nowhere is this quote more true than with individuals and organisations trying to embrace the basic principles of internal customer service, especially as “it is widely accepted that internal customer satisfaction is a driving force in the achievement of external customer satisfaction, which is critical to the long-term success of any organisation” (Jun, M. and Cai, S., 2010, p. 219)

Organisational leadership needs to help employees understand their internal relationships in respect of internal customer service and how to make it effective. Following these six simple steps will add immediate value to your job and your organisation;

1. It’s the organisations responsibility to ensure they have the right people in the right positions – at all levels.

2. Organisations don’t need you to be best friends with the employees in the departments ‘down the corridor’, but they do need you to work professionally together, day after day, developing internal customer relationships.

3. Successful internal customer service relationships are developed in a climate of collaboration where the customer expectations are based on organisational requirements (rather than personal) and where the parties work together to find optimal business solutions.

4. Providing internal customer service becomes the rule not the exception. Internal customers do not misuse their position of perceived power, preferring to work with their internal service providers to build a climate of mutual understanding and respect.

5. Communication – Communication – Communication. The internal customer service relationship is all about continual and effective communication, where the internal customer is communicating their realistic needs and expectations (and how these may change from time to time due to organisational priorities) and the internal service provider is continually providing feedback on performance, constraints and opportunities.

6. The win-win solution is taking the professional ‘high-ground’ and accepting you can work within a business environment, where you collaborate and work with your respective internal customer or service provider. This will be rewarding both for the organisation and more importantly for you, where your working environment will be significantly more enjoyable than the alternative.

In conclusion it’s worth remembering that an organisation is made up of a group of diversified individuals who need to work together in the most efficient way to ensure the organisation optimises its current and future potential. The customer – service relationship can often be misunderstood as a hierarchical relationship where the internal customer can place unrealistic demands on their internal counter-part (and visa-versa). However we know from external customer service that if a customer places unrealistic expectations on an organisation, it will lead to a break down in the customer-service relationship and will have a detrimental impact on an organisations performance.

So it just requires individuals, such as yourself, to embrace these simple steps which will improve internal customer relationships and in doing so, increase your levels of job satisfaction; a win-win for everybody.

References

Jun, M. and Cai, S. (2010). Examining the relationship between internal service quality and its dimensions, and internal customer satisfaction. Total Quality Management, Vol. 21, No. 2, p. 205-223.