At age 48, Peter Bailey, an SVP of Operations, had everything going for him. His work was rewarding and he was helping to shape the future of the company. Peter was happily married with three children. He attended their activities whenever he could. Peter had been married for 19 years and he and his wife were planning a trip next year to Hawaii to celebrate their 20th anniversary. He also kept in shape by jogging three to four times a week, which also help him manage the work stress.
One day Peter Bailey dropped dead at age 48 of a heart attack. There were no warning signs. Everyone in Peter's life was stunned. No one had planned on this happening, not his family, his friends, or his colleagues. At work, Peter had some good people reporting to him, but no one ready to step up and replace him.
Most U.S. companies today that are over 20 years old are no longer being lead by their founder. One way or another everyone leaves. People change jobs, get laid off, retire or die. Today, baby-boom leaders are preparing to pass the torch to their successors. Some are leaving their executive positions to pursue new interests, or lifelong passions.
The leading edge of the baby boom generation begins to retire in 2008. It is estimated that one 20% of all executives are now eligible for retirement and five years that number will climb to 40-50%. This phenomenon, which starts in 2008, will continue for the next 20 years and has astounding implications for corporations worldwide. This means you have three years to get your plan ready to impact your legacy track. Whether you are a baby boomer, born between 1946-1964, or a younger leader of your company, the issue of succession needs to be part of your business plan.
Developing a succession plan mentally prepares you and your successors for change. It also ensures that you have identified the various skill sets required in preparation of any major change. Succession planning also allows you to prepare for what is next in your life and leaves a legacy of competence and admiration when strong employees have been groomed to take over the reins. This is not a small issue, and it’s becoming ever more apparent as many high-level executives step away from the leadership roles in their companies.
Logically and emotionally, people know it is important in their personal lives to do estate planning, which is really succession planning for your personal life. It may be even more important to develop succession plans at work because thousands of families, and investors are economically impacted by your decision or indecision. You owe it to your investors, your board, and your employees. The conditions you leave your department, your team, and your company in become part of your personal leadership legacy and greatly influences the continued health of your company.
What can you do to prepare for your legacy?
Start by identifying at least two successors. Often, we think the people we identify are great, yet others in the organization do not value them as much as we do. It is important to know what others in your company think about your choices if you are going to position them successfully. A large part of successful succession planning is not only having the right people in line and ready to go, but also positioning them in the organization to take over before you leave. Conducting a 360 leadership assessment for potential successors gathering organizational feedback on their strengths and areas for development is a great way to go. We’d be happy to talk to you about the one we use. Lastly, put together a development plan that incorporates skills, leadership competencies, and career rotation opportunities to get your successors ready and optimally positioned.
Be deliberate about succession planning, it will serve you and your company well, and help you leave a strong legacy whether you’re in this world or the next.
What’s my legacy?
Now, that’s an interesting question to ponder.
What are you and your company doing to prepare for the huge number of experienced baby boomers that will be retiring in the next five to twenty years?
Call us if you want to discuss your succession challenges. We specialize in building leadership bench-strength throughout the corporate enterprise.
Leadership Coaching Newsletter is written and produced by Wendy Capland. If you have any questions or comments, please send them to: wcapland@visionquestconsulting.com. We'd love to hear from you.
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