Some business experts estimate that more than 70 percent of U.S. companies engage in some sort of succession planning and talent management initiatives. Basically, this means that the vast majority of companies now have some sort of formal, planned leadership development processes in place to help select, prepare and transition high-potential employees into new positions. So why is the preparation of the “next generation”: of leaders so important to these companies?

Most would say that solid leadership is hard to find and that it’s much more advantageous (and less risky) to prepare someone they already know and who already knows a great deal about the company. These companies look at succession planning as an insurance policy that protects them from a breakdown after a leader retires, dies or leaves the company.

However, despite all the benefits, preparing future leaders doesn’t come easily. And often the challenge is greater within family-owned companies due to the residual effects on business and personal relationships that could follow a bad decision within in the bloodline.

Every quality succession plan begins with addressing key positions and identifying key talent within the company. Key positions are those that are critical to keeping the operation running efficiently and strategically. Likewise, key talent should include those employees currently in mission-critical roles within the company. These are the employees who have shown strong commitment to the organization and its mission, and who have the knowledge, skills and attitudes (KSA).

Be sure to keep your eyes open for talent that isn’t in high-profile positions. Often, high-potential employees go unnoticed simply because there are never problems with their work and their operations run effectively all the time. Companies that go into succession planning with eyes wide open are typically more proficient at identifying talent at all levels so as not to miss any long-term potential.

Once all key talent has been identified, companies should assess each person according to the KSAs they currently have compared to what they will need in their step up to a key position.

Of course, this assumes that the company already has a keen understanding of the KSAs needed for the key positions. If that’s the case, use them as benchmarks to see just how close your key talent is to having the level of competence they’ll need.

The gap between a person’s competence now and the competence they’ll need is called a KSA development gap. Each person being considered for promotion should have a development plan that specifically addresses the gaps they already have.

Be sure to create an engaging plan that stretched each individually outside their comfort zone. Professional development happens best when an individual is thrown out of sync from their typical behavioral patterns. Therefore, plans with varied type of learning and development activities are more likely to be successful.

Be sure to have complete buy-in from each of the individuals for whom these plans are written. Without it, there are no guarantees they will engage in any of the activities you design for them.

Be timely about starting the process. Leave enough time for people to actually get much of the plan completed. This will also give you a good idea of how committed each candidate truly is to the ideas of taking on additional responsibilities.

Succession planning is strategic and very beneficial for companies looking for long-term success. Consider outsourcing some or all of the development of your succession plan in order to have dedicated resources addressing it. The time you’ll save utilizing outside expertise will pay dividends in the long run.

Published in Building Indiana News, Jan/Feb 2012, p. 34