Scaling The Ladder

How to prepare for your successor

In a perfect world, succession planning would be a simple transition.

There would be a well-groomed successor with all the necessary criteria such as the ideal industry experience, skills and attitude; ready to assume his or her new role at the appropriate time.

This is often not the case and this is where an executive search consultant usually steps in.

Tapping into non-traditional talent pools which are not immediately obvious is an option that some leading organisations have taken.

Sir Richard Branson, the successful entrepreneur and founder of the Virgin Group, began his rise in the corporate arena after starting Virgin Records, a music label.

Closer to home, Tan Sri Tony Fernandes emulated this route, which has made him an international icon.

So, what do music and airlines have in common? In truth, these industries are vastly different except for the skills set and experience that these two exceptional individuals possess that were transferable across these unrelated industries.

Usually, when new technologies emerge or when companies begin to aggressively expand their businesses into new markets, they will not be able to mobilise the existing talent within their organisations to fill all the newly created management roles in these new markets.

Within recent memory for instance, international telco operators forging into Malaysia built their management teams by recruiting strong consumer marketing professionals and other senior executives from the large local conglomerates, consulting and banking sectors.

Mature industries offer a more robust talent pool in terms of both depth and breadth in such core functions as marketing, finance, human resources and sales, amongst others. Another instance would be in a monopoly type of environment whereby there may only be one or two competitors.

Other than approaching their competitors' staff there would be no other alternatives for experienced hires and as such these companies would need to consider tapping into other industries for talent.

Handing over a position to the right person is necessary for the company to continue thriving Handing over a position to the right person is necessary for the company to continue thriving

At times, approaching a competitor's staff may not be a viable option if an organisation is trying to raise the standard of the way things are being done in the industry or change the status quo in some way, as their competitor's staff would have knowledge of the industry but not necessarily the other critical skills required to facilitate this change.

Open-minded approach

A CEO of a plantation group told me that when his company was looking for a country head for one subsidiary, he was unable to identify a suitable candidate from within the organisation with the necessary background in plantation.

One solution was to seek out talent from other countries with the required experience. However, the cost of acquiring and maintaining such an individual would have cost the company at least four to five times the local norm.

Although it is not common to find such an open-minded approach to hiring, the management team of this plantation company was able to look beyond the job description and focus on the capabilities that were truly required for this role.

Taking the road less travelled, the management decided to appoint a candidate with a strong track record of success in the engineering field. Three years into the role, the candidate is still thriving.

More often than not, CEOs and business leaders are looking for the ideal match to the job description of a vacant position rather than the actual issues that the individual needs to be able to manage. For instance, it is very rare to find an individual who is equally strong in strategic thinking and operations management.

A candidate with a strong strategic mindset is likely to be better at focusing on the bigger picture and may need to analyse issues thoroughly before making a decision. Such an individual is not likely to jump into projects without considering all the facts first.

On the other hand, an operationally strong candidate would likely be more adept at managing the day-to-day operations and able to deal with routine problems swiftly.

This individual is less likely to spend time looking at the bigger picture and would probably be more focused on immediate goals.

When faced with the need for both skills in the same individual, the critical question to ask is how much each of these skills is required for the job.

The answer to this question could determine if we are looking for a strategically strong individual with the ability to be operational for short periods of times, or if we are looking for a very operational individual with some strategic-thinking skills that could be honed.

In most cases that I have come across, the need for one of these skills sets is usually higher than the other and hardly ever needed in equal doses.

Obviously, there are limitations to bringing in someone from outside the pre-defined search parameters, which is the main reason that most organisations do not use this as their primary approach in the search process. It is simply because this individual would not have had the benefit of “growing up” in the industry in which he or she is coming into. Hence there is no familiarity around the jargon or nuances that are specific to a particular industry.

Putting the individual through an assimilation process can help to close this gap but the process has to be managed carefully so that the objective of bringing in someone from another industry is not negated in the over-assimilation process to produce a “yes-man.”

A strong support structure that gives positive and constructive feedback could also help the individual accelerate his or her learning curve towards becoming a more effective contributor to the business.

A candidate who had made the switch from consumer goods into the financial services industry, once told me that he faced a great deal of resistance in getting his ideas across to the management team. If he had the appropriate support structure, perhaps he would have found better traction with the organisation.

It should also be acknowledged that not all employees are flexible enough to make the cross-industry switch.

Comfort zone

More risk adverse candidates may not want to move even if they see the benefits of such an opportunity. When an individual becomes a specialist or a subject matter expert in his or her field after sharpening a particular skill over a period of time, the likelihood of being compensated commensurately increases but there is also a danger in over specialisation. The unknown can become very daunting to such an individual and leaving their comfort zone becomes unthinkable.

In the final analysis, it is entirely up to the individual to make that decision before he or she reaches a point whereby it is no longer viable to make the transition as this might involve having to take a pay-cut just to start over in a new industry.

Moving forward in an environment with ever increasing complexity, the demand for the right skill sets and experience at the right time is only going to increase.

The challenge is to be able to find the right talent when the need arises. Perhaps one solution to this problem could be to tap the less obvious talent pools and for employees to be more open to new possibilities. As the saying goes, insanity is doing the same thing but expecting a different outcome.

Article extracted from Talking HR, StarBiz. Pauline Ng is the consulting director and head of BTI Consultants Malaysia. She is constantly looking for ways to help organisations identify their next CEO and game changer.