Partner & General Manager, Heidrick Digital
Heidrick & Struggles
Executive Vice President, Human Resources
GOVERNING BODY HOST
Director, Human Resources
Vice President, Human Resources
Vice President, Human Resources
Succession planning has never been more challenging. Uncertain economic conditions and the ever changing business landscape are leaving CHROs perplexed with how to identify the next generation of leaders.
Furthermore, Gartner research found that almost two-thirds of HR executives believe leadership roles will change over the next few years, and one-third of those executives say they cannot predict how this change will take shape.
Evanta’s CHRO communities overwhelmingly named succession planning as their #1 mission critical priority for 2023, and the New York CHRO community recently came together for a town hall to discuss potential strategies. Here, HR leaders conducted intimate conversations with their peers about succession management in the current economic climate, identifying and developing a diverse roster of successors, executing a flexible roadmap and measuring success.
The program was moderated by Maria Howard, Partner & General Manager, Heidrick Digital at Heidrick & Struggles, and New York CHRO community members Gracie Mercado, Executive Vice President, Human Resources at Macmillan; Michael Kerrigan, Director, Human Resources, at Interactive Brokers; Karen Laurel, Vice President, Human Resources at Purdue Pharma; Mallory Martino, CHRO at BIC; and Mike Prutting, Vice President, Human Resources at Bigelow Tea helped to facilitate the discussions.
Succession Planning Trends
Opening the program, Maria Howard gave insight into market trends on the future of leadership. She cited how disruptions - such as economic uncertainty, generative AI, and changing consumer preferences, to name a few - are putting pressure on businesses and influencing them to change the direction of their leadership teams.
Three main areas the market has changed:
- Creation of new roles – There are now 51 C-suite titles on LinkedIn.
- Executive teams are getting bigger – Fortune 100 companies added almost 500 new executives between 2020 and 2022 (a 48% increase).
- Faster pace of change – Leadership movement is happening at a faster pace, and there is an emphasis on nurturing talent and internal moves.
To ensure leadership is fully prepared to meet the new needs of the business, and anticipate future needs, Maria shared that HR leaders must prioritize succession planning as a business initiative intertwined with strategy, rather than considering it just a people process. She also emphasized that it should be included in scenario planning to prevent risks to business operations, and finding solutions that allow planning to happen at scale and in an always-on format will help support these processes.
Key Takeaways from the Discussion
CHRO participants divided into small groups to further discuss this topic. These are the key takeaways:
- Get back to the basics - Having dealt with disruption after disruption over the past few years, there was consensus among the group that they need to reset their succession planning programs. One HR leader said, “I find comfort in none of us having a silver bullet.” Participants discussed a need to get back to the basics as they reevaluate their processes. Here is a sample of questions they are asking themselves:
- What are we trying to accomplish? Is it talent development as part of a supply chain? How to get out of “excel hell”?
- Can we look at existing data? Exit data, performance management data, etc.
- Who do we do succession planning for? The C-suite? VP and above?
- Is interim succession planning part of the regular process?
- Are we currently tracking the success of succession planning? How effective is our current program? How can we better measure this?
- Protect disproportionate value throughout the organization - CHROs discussed having a disciplined process to ensure the entire business has high-level talent, and a few CHROs shared that it is critical to get executive buy-in, and meet frequently to accomplish this. One HR leader added, “We meet monthly with the C-suite to discuss VP roles across lines of business movement, because people were hoarding talent in their departments.”
- Assess your tools and resources - Many participants expressed they are looking for new tools or vendors, and they are excited about the potential opportunities of AI for succession planning at scale. Others stated the importance of assessing their existing programs and building success off of them, and one CHRO advised peers to look at the development tools they currently have available to ready future leaders for new positions.
To connect with like-minded CHROs and discuss the mission critical priorities impacting human resources leaders today, apply to join your local CHRO community, and take a look at the calendar to see when your community is gathering next.
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