For most businesses, the key to long-term success isn’t just the product – it’s the people. Products and services come and go, technology advances and inevitably, new competitors appear.
But in any industry, a business will persist only as long as it is led by people who understand its culture and have the experience and talent it takes to lead from day one – especially if they’re called to a position of leadership in a moment of crisis.
Problem is, many companies defer succession planning or sidestep the conversation altogether. A recent study by Stanford University found that 39 percent of companies had no internal candidates in line to become CEO at a moment’s notice. The failure to identify a path ahead for new leaders can significantly jeopardize a company’s future.
It can also signal a lack of an overall talent strategy.
At Deloitte, we try to look at every team member as a potential leader. Early in their careers, we may, for certain individuals, try to build in temporary “stretch” assignments to give our people the opportunity to learn new strengths and test their abilities in new situations.
Depending on their roles, we may provide our people with experiences through new departments, industries, locations and networks, so they gain fresh perspectives on our business, and maybe help us see what we’re doing in new ways.
The value of sponsors
Companies of all sizes can do a number of other things to plan for succession. Within our organization, we sometimes match employees to sponsors, which we view as more than mentorship. Mentors are terrific ways to get and give advice. But sponsors do more than that.
They are tasked with putting their names, influence and experience to work for high-potential staff, if they are deserving of that kind of support. In a study published by Harvard Business School, employees with sponsors got more stretch assignments, promotions and pay raises than workers who didn’t have the benefit of such relationships.
And while some of our best potential leaders may not stay with us forever, we maintain our relationship with them if they leave. In fact, we’ve built an active alumni network so that former colleagues can enjoy ongoing professional development and a natural way to connect. This network is a resource for former Deloitte professionals who may want to explore the possibility of returning to the organization.
And remember that succession planning is not just about who works in the C-suite. It’s about your entire talent strategy. This happens to mean a lot to millennials, our youngest and largest generation in the workforce. By 2025, they’ll comprise three in four global workers.
What’s more, millennials on average stay on the job less than a third of the time as that of their baby boomer counterparts. So if they’re not given chances to shine, millennials are certain to jump to other opportunities.
Treating every employee like they could rise to the C-suite is a good way to meet everyone’s needs. You’ll deepen your bench, discover high potential leaders and give your youngest team members a strong reason to help your business grow. Because in every business, the best succession plan is one which is already in place.
Byron O. Spruell is Vice Chairman and Chicago Managing Principal at Deloitte.