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• To develop a talent pipeline pool

• To find out well in advance successors for each key position in the company

• To ensure readiness of the individuals for taking over

• To ensure minimum disruption/smooth transition • To continuously foster organizational effectiveness

• Provide increased opportunities to high potential talent

• Help individuals realize their career plans within the organization

• Niche skils - supply gap

• Hygiene

- Organization Strategy

- People Strategy

Organization Plan

-Succession Planning for Critical Roles -Talent Pipeline – High Potential- Talent Retention

Talent Plan

Track & Implement Plan

40% of those surveyed said that company growth was limited because they didn’t have the right talent.

75% said that their company is chronically short of leadership talent.

Failure rates are high (40-50%) when executive talent is hired from outside.

Two-thirds of employees have low to moderate confidence in their companies’ top executives;

Employees say company leadership is a key contributor to job satisfaction, commitment and intent to stay; especially true for top talent.

Recent surveys state that employees value most the leadership qualities of honesty and integrity.

Only 1% of companies rate their succession management plans as excellent; two-thirds rate them as fair or worse.

─McKinsey, The War for Talent, Right’s People Brand Research Report, DDI Exec. Dev. & Succession Management

Assessment ofKey Positions

Identification ofKey Talent

Assessment ofKey Talent

Generation ofDevelopment Plans

DevelopmentMonitoring & Review

SuccessionManagement

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1. Have you lost high potential talent because they didn’t know they were on the list?

2. If your executive team “got run over by a bus,” would their replacements be able to step right in and be productive?

3. Is anyone on the “top floors” or in the Boardroom worried about the status of your “talent bench?”

4. What lost opportunity costs has your organization incurred because it took a long time to replace a key leader?

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6. How does someone in your organization get selected to be a potential successor?

7. Do you have leadership development and talent management processes in place to grow successors?

8. If your organization has succession criteria, is it past focused or future oriented?

9. If you have a succession planning process, is it grounded in your business strategy?

10. Would your selection/promotion practices pass a “drop in” legal challenge?

• Secure senior level support

• Align with future organizational strategy

• Keep the process simple so that busy line managers do not find the process burdensome

• Engage technology to support the process

• Continual reinvention

• Global approach

Build or Buy ?

Evolution of Succession Planning

Immediate needs

Single positions

Crisis management

Strategic focus

Active, ongoing process

Pivotal talent pools at all levels

Leadership & org development

Long term needs

Key leadership roles/pools

Talent Reviews

Development plans

Near-term needs

Back-up charts

Critical positions

Risk management

Back of the Envelope Replacement

Planning

Succession Planning Succession

Management

• Succession management not linked to business strategy

• Reactive approach – only when a position becomes vacant

• Lack of ownership by top management

• Line managers ignore development of the talent pool

• No formal process to track candidates

• Lack of objective, data based discussions

• Communicating their support

• Share perspectives on the future leadership needs of the organization

• Ensuring that it is perceived as management directive, not just a HR initiative

• Volunteer to be part of succession management process

• Ensure allocation of adequate resources

• Targeted processes

• Ensure comprehensive assessment of talent

• Creation of talent databases

• Identification of future talent requirements: being pro-active

• Structured & individualized development planning

Talent hot Talent hot houseshouses

• Rigorous leadership program - Build From Within

• Each of the top 50 jobs has three replacement candidates lined up

• Ensure each successor gets the experience to be ready for the next job

• They train people to work in different countries and businesses so as to develop a deep bench globally

• The disadvantage is that people did think in similar ways

President & Chief Executive, P&G: From A.G. Lafley to Bob

McDonald in 2009...

“Today I could show you the next generation of successors to current leaders, the generation after that, and the generation after that.”

- Moheet Nagrath, Head of Human Resources at P&G

From Jack Welch to Jeffrey Immelt in 2000...

• Jack Welch (Chairman & CEO, GE) submitted a list of 23 potential CEO candidates to the Management Development Board in 1994

• Successors reviewed every June and December by Board and Welch

• No outside candidates considered

• Succession plan was closely tied with management & leadership development plan

• Leading contenders were put on various proving grounds & given cross business exposure

• GE Board made regular visits to get impression of the candidates – natural style and approach

“From now on, choosing my successor is the most important decision I'll make. It occupies a considerable amount of thought almost every day.”

- Jack Welch, 1991

Azim Premji – succession plan disclosed to board of

directors…

• Succession Planning program is called Talent Review & Planning (TRP)

Identify employees who are ready to take over the critical roles immediately and over the next 1-2 or 2-3 years

• Developmental planning for each identified internal candidate - job rotation, training, coaching and performance counseling

• They also keep track of potential external candidates, and establish touch points for attracting them at the appropriate time

• Training could be through internal programs or on-the-job (local as well as global) to gain cross-functional or cross-geographical exposure

• System of listers Continuous process of discussing people Identifying people at different levels For the distance they will be able to travel in their career

• The process is centered on Identifying a list of potential candidates Placing them in specially chosen and challenging roles Then observing the outcomes

Nitin Paranjpe joined HUL in 1987 as mgmt trainee,

appointed as CEO & MD in 2008…

• Six out of eight Executive Directors on the board are retiring within three years, including AM Naik (Chairman & MD, L&T)

• The company is putting in place an interim leadership team to steer the company until 2015

• Two global consultants McKinsey & Bains are working on a succession plan for the company

Successor yet to be identified for AM Naik…

• Critical positions identified as part of OTR process basis:

Impact on financials Exposure to brand Uniqueness of the skill (Supply in market) Span of influence & control Relevance of position – If redesign the org from scratch would this role be there Impact on customers / shareholders / investors External value (How much sought by competition) YLP,eLeap,bLeap,Shadow boards

From Manoj Kohli to Sanjay Kapoor in 2010...

Guiding Metrics N ( Numerator) D ( Denominator ) Month

1 …….

Month 12

Out of internally closed positions %filled by identified successors

Total no of positions closed

by identified successor Total no. of critical positions filled internally N/D%   N/D%

% Career Plans implemented No. of people movements

as per plans captured Total no. of Successors to critical

Positions N/D%   N/D% % Development Plans

implemented Total no. of Development

Plans implemented Total no. of Successors to critical

Positions N/D%   N/D%

• Succession Plans created for all critical positions

• Succession Plan analyses the possibility of making a growth plan after matching employee strengths / skills / development needs with the Business needs and requirements

Position Current incumbent Potential SuccessorFunction Critical

PositionCurrent

IncumbentPlanned

MoveTime for the Next Move

(0-12mths/1-2/>2)

Retention Risk

Name Readiness (Ready now/1-2

yrs />2 yrs)

Talent Segmentatio

n

Retention Risk

Openness to Relocation (Yes /No)

Comments / Developmen

t Needs / Next

Assignment

                      

                    

 

                      

                      

“Bosses are stewards of people’s talent

Thank you!