Chapter 7

Question 1

What is succession management?

Answer 1

> Succession management refers to the systematic process of determining critical roles within the organization, identifying and evaluating possible successors, and developing them for these roles

Question 2

What is causing the increasing pressure on organizations to develop succession plans?

Answer 2

> Due to factors such as the impending retirement of millions of baby boomers, the large increase in the turnover of CEOs, and the need to transfer corporate knowledge, there is increasing pressure on organizations to develop succession plans.

Question 3

What is succession planning designed to do?

Answer 3

> Succession planning is designed to protect the company from significant gaps in leadership.

Question 4

In situations of abrupt personnel changes, the benefits of succession planning become very apparent - what ware some of those benefits?

Answer 4

> There will be less time and reduced financial expenditure on recruitment and leadership development (already have a candidate)

> diminishes the need for an external search of qualified candidates for a particular position

> it helps the company build a brand identity.

Question 5

How does succession planning build brand identity in employees?

Answer 5

> By identifying and grooming an internal successor, the company ensures it will be led by someone who shares its values and deeply understand the company’s brand promise, its customers, and its employees because that person has lived it themselves.

Question 6

Companies without a succession plan experience a drop of what percentage in business?

Answer 6

> experience a drop of about one-third in business after the transition to new management

Question 7

The effective implementation of succession management has been linked to what outcomes?

Answer 7

> has been linked to these outcomes: the retention of key talent, increase in shareholder value, and reduced senior executive turnover after succession.

Question 8

What did succession management use to focus on?

Answer 8

> Succession management used to focus mainly on the CEO

Question 9

What other roles is succession management critical for?

Answer 9

1) The CEO

2) The senior management team—the “mission critical positions,” those executives whose departure would seriously impact the organization

3) Critical roles based on long-term value to the organization (such as scientists or customer relationship specialists)

Question 10

The goals of succession management programs are:

Answer 10

> to identify and prepare future leaders and to ensure business continuity

Question 11

The first priority of any succession management program is what?

Answer 11

> is to have a plan to replace an organization’s leaders.

Question 12

How long can the effect of no succession management last and what does it result in?

Answer 12

> The research shows that delays in naming a successor result in decreasing operating performance, and that this negative effect can last up to two years

Question 13

Is succession management still needed when vacancies are predictable?

Answer 13

> Succession management is needed even when retirements and company sellouts are predictable.

Question 14

The Society for Human Resource Management surveyed its members in 2021 and how many didn’t have succession plans? how many did?

Answer 14

> 56 percent said their organization didn’t have a succession plan in place.

> Only 21 percent reported having a formal plan, while 24 percent said their organization had an informal plan

Question 15

How many organizations don’t have succession plans?

Answer 15

> About one-third of organizations do not have a succession plan

Question 16

What are 8 reasons why Organizations Have Succession Management Programs

Answer 16

1) Improve internal candidate pools

2) Assure business continuity

3) Reduce skill gaps

4) Retain employees

5) Help individuals realize their career plans within the organization

6) Develop leaders more quickly
Encourage the advancement of diverse groups

7) Improve employees’ ability to respond to changing environmental demands

Question 17

What is replacement planning?

Answer 17

> Replacement planning can be defined as the process of identifying short-term and long-term emergency backups to fill critical positions

Question 18

What are four ways that replacement planning has evolved into succession management?

Answer 18

> broadening the focus,

> expanding the time horizon,

> creating a talent pool of replacements, and

> improving the evaluation system.

Question 19

What does replacement planning focus on?

Answer 19

> The focus of replacement planning is the job, and having a replacement ready to fill that job if the incumbent dies or quits.

> This type of planning focuses on the high-potential candidates (replacement track stars), all ready to step into vacant positions, and in doing so sets off a chain effect throughout the organization

Question 20

What does the replacement model assume?

Answer 20

> This model assumes that people have single careers within one organization. Thus, replacements are replicas of the current jobholders.

Question 21

What does replacement planning depend on?

Answer 21

> This planning depends on a stable future, in which the knowledge, skills, attitudes, and other attributes (KSAOs) of future managers looks pretty much like those of the current managers

Question 21

What is the difference in starting points between replacement planning and succession management?

Answer 21

> In replacement planning, the starting point is the job, whereas in succession management, the starting point is the strategy of the organization.

Question 22

What terms do replacement planning and succession management operate within?

Answer 22

> The traditional planning approach was concerned with immediate and short-term replacements (short term singular replacements)

> Succession management looks at a longer term (after ensuring that immediate replacements are in place) and focuses on a future of two years or more. (long-term talent pools)

Question 23

What are talent pools?

Answer 23

> Talent pools are groups of employees, often identified as high-potential individuals, who are being trained and developed to assume greater responsibilities within the organization.

Question 24

How many successors should there be?

Answer 24

> The key is not to develop a specific successor to fill any position (done by about one-third of organizations) but to develop several multiple successors (about two-thirds of organizations do this) for every position

Question 25

What is the key to communicating succession to employees?

Answer 25

> The key is to communicate to these star employees that they are valued and that they have leadership potential, without ever promising anything. > Another approach is to tell high-potential employees about their status, and then explain that they will be given a series of developmental challenges and that their potential will be continually assessed.

Question 26

What is talent segmentation?

Answer 26

> Talent segmentation, the identification of employees who are critical to the success of the organization, is expected to become as important as customer segmentation

Question 27

A succession management approach should not only depend on internal candidates, but also track what?

Answer 27

> external candidates > the new generation of succession managers tracks high performers in the external market, thus ensuring that new skills and ideas flow into the organization.

Question 28

When do internal succession candidates work out best?

Answer 28

> it appears that when a company is doing well, internal candidates are favoured to sustain high performance, because they possess valuable firm-specific knowledge

Question 29

it appears that companies that are performing well do better by hiring in what way? How about those that struggle?

Answer 29

> from within > and those companies that are struggling show better returns by hiring outsiders

Question 30

Advantages of internal succession candidates:

Answer 30

> Organizations have more and better information about them > Organizations that offer career development and opportunities to increase commitment and retention among their employees. > preserve corporate culture. > Internal candidates can hit the ground running, because they know the organization, its people, and its processes. (less internal disruption) > Recruitment and selection costs are lower.

Question 31

What are the advantages to external succession candidates?

Answer 31

> The external candidate may have better skills to lead the organization through a major transformation or change in strategy. > The external candidate brings new knowledge and skills to the organization and prevents the organization from becoming inbred and stale.

Question 32

What kind of raters are involved in the succession management approach? How do companies get this feedback (rating)

Answer 32

> In a succession management approach, several raters give current evaluations on an employee’s performance > Most companies use 360-degree feedback mechanisms and increasingly use feedback from mentors and coaches

Question 33

FIGURE 7.2.2 RESERVE

Question 34

FIGURE 7.2.2 RESERVE

Question 35

The succession management process links what other processes?

Answer 35

> The succession management process links replacement planning and management development.

Question 36

What are the 5 steps to succession management?

Answer 36

Step 1: align succession plans with strategy. Step 2: identify skills and competencies needed. Step 3: identify high-potential employees. Step 4: provide developmental opportunities and experiences. Step 5: monitor succession management.

Question 37

There are at least two approaches to identifying the characteristics of successful managers:

Answer 37

> the job-based approach and the competency-based approach.

Question 38

The job-based approach suggests what?

Answer 38

> The job-based approach suggests that employees who have significant experience as managers, and who have acquired job skills such as motivating others, delegating, marketing, or managing finances, will make successful managers.

Question 39

What does the competency based approach involve?

Answer 39

> Competencies are groups of related behaviours that are needed for successful performance

Question 40

What is "talent"

Answer 40

> Talent consists of those employees who can make a difference to organizational performance

Question 41

What are high potentials?

Answer 41

> High potentials consistently and significantly outperform their peer groups in a variety of settings and circumstances > High-potential employees consistently exceed expectations. Managers turn to them in difficult situations with difficult projects > 800x more productive than the average employee

Question 42

In HR, we often state that the best predictor of future performance is what?

Answer 42

> past performance

Question 43

Organizations use several approaches to identify managerial talent, including:

Answer 43

> temporary replacements, replacement charts, strategic replacement, and talent management culture

Question 44

What are temporary replacements?

Answer 44

> At the most primitive level, most individual managers will have identified a designated backup and potential successor > This is done in case the manager is away from the office for extended periods (e.g., vacations, training). (Favours internals)

Question 45

What do replacement charts involve?

Answer 45

> At the next level, some organizations prepare replacement charts with predicted departure dates of the incumbents, along with a shortlist of possible successors. > This is usually done around performance appraisal time, using the performance evaluation data. > identifies those that are ready now, those who will be ready in three to five years, and the long shots. > These approaches tend to replicate current strengths (and weaknesses) and are not necessarily future-oriented, nor are they strategically aligned with the needs of the business. (This stair-step approach is too rigid during times when organizational structures are changing rapidly and employee loyalty is weak.) (Favours internals)

Question 46

What is involved with strategic replacement?

Answer 46

> A more advanced succession management program exists in an organization that is less inclined to simply replicate existing incumbents, but instead identifies the leadership competencies it needs, on the basis of organizational plans. > The organization then tries to support and train these managers from within. (favours internals)

Question 47

What does talent management involve?

Answer 47

> Managers are committed to defining and modelling an employee value proposition that answers the question, “Why would a talented person want to work here?”

Question 48

What is an EVP (An Employee Value Proposition)

Answer 48

> An EVP is a brand positioning aimed at employees so that the company will be seen as an employer worth working for, and all company messages sent to the labour market are compelling and consistent.

Question 49

Key candidates seem to be attracted to companies that pose one of four brand positions: including -

Answer 49

> A “winning” company, which is characterized by growth and development > A “big risk, big reward” company, which offers great potential for advancement and compensation > A “save the world” organization, which is attractive to those wanting a mission > A “lifestyle” company, in which employees want flexibility and a good relationship with the boss

Question 50

Organizations with a strong employer brand experience what?

Answer 50

> xperience lower hiring costs and reduce turnover.

Question 51

Organizations with employer brands outperformed others in three critical areas:

Answer 51

> revenue, net income, and share price

Question 52

Assessing employees to identify high-potential candidates must be done in what way?

Answer 52

> Assessing employees to identify high-potential candidates must be done both fairly and accurately: fairly so that employees buy into the process and feel that the search for talent is an equitable procedure, and accurately so that the selection process is both reliable and valid.

Question 53

Are yearly reviews good?

Answer 53

> However, the use of annual reviews of talent can result in a mechanical approach that leads to the goal of completing the forms provided by HR, rather than to quality dialogues about leaders. Some managers simply update forms to meet a deadline. > A better process would be to commit to quarterly reviews and the allocation of one full day to choose the top candidates by ranking them against all other candidates.

Question 54

Do review discussions get politicalized?

Answer 54

> executives rate their own candidates too positively, > people are hesitant to criticize the choices of others, > members distrust the motivation of others’ recommendations (“passing the trash”), > running conflicts between executives result in cheap shots about candidates, or information about the best players is withheld as executives want to own this talent.

Question 55

Techniques for Assessing Employee Potential Include:

Answer 55

> Performance Appraisals: Raters, who may include the supervisor, colleagues, customers, and subordinates of an employee, evaluate the employee against some pre-developed standards. > Assessment centres: Assessment centres involve a process by which candidates are evaluated as they participate in a series of exercises that closely resemble the situations faced on the job. > Human resources management systems (HRMS): Large amounts of information about employees’ KSAOs can be stored in databanks and used to identify employees with needed skills. Employees’ files can document their experiences, skills, abilities, and performance evaluations.

Question 56

In the succession management process, the focus in management development is on what?

Answer 56

> is on the development of competencies, not just on job preparation.

Question 57

The most common development methods are:

Answer 57

> promotions, job rotations, special assignments and action learning, formal training and development, and mentoring and coaching.

Question 58

What is a promotion?

Answer 58

> A promotion refers to an employee’s upward advancement in the hierarchy of an organization and usually involves increased responsibilities and compensation.

Question 59

In flat organizations, where promotions are rare, a preferred developmental method is what?

Answer 59

> a preferred developmental method is job rotations—developing managers horizontally rather than vertically

Question 60

What are job rotations?

Answer 60

> Job rotations are lateral transfers of employees between jobs in an organization.

Question 61

A common use of job rotation is to:

Answer 61

> is to take a functional specialist, such as an accountant, and rotate this specialist through both HR and operations in preparation for management positions.

Question 62

What are the downsides to employee rotations?

Answer 62

> the downside of employee rotations includes the increased time needed to learn the new jobs, the cost of errors while learning, and the loss of efficiency that otherwise is gained through repetition and specialization

Question 63

What are special assignments and action learning?

Answer 63

> On-the-job learning is still a favoured path to the development of managerial skills. Most organizations test high-potential employees by giving them an assignment in addition to their regular duties. > In another case, a team of managers might be given a special assignment, such as developing an equity plan for the organization or developing an e-commerce plan for the company. These types of special projects enable candidates for future executive positions to network and test their skills in new environments.

Question 64

Many very successful managers explain that their successes resulted directly from having been through what?

Answer 64

> rom having been mentored: > A senior executive took an interest in them and their careers at a critical time in their lives.

Question 65

What are mentors?

Answer 65

> Mentors are executives who coach, advise, and encourage junior employees. The mentor takes an active interest in the career advancement and the psychosocial development of the protégé.

Question 66

How did mentoring used to happen? What is it like now?

Answer 66

> Mentoring used to happen informally, but organizations have recognized the value of having a senior manager take a career interest in a junior employee and so have started formal mentoring programs

Question 67

Who are mentors usually? What about coaches?

Answer 67

> Mentors are almost always more senior people who volunteer to be mentors within an organization, while coaches tend to be paid counsellors from outside the organization.

Question 68

What has accelerated the need for mentoring and coaching?

Answer 68

> accelerated the need for mentoring and coaching in order to build strong professional relationships within the organization.

Question 69

What are the 5 evolutions of a Coaching Culture?

Answer 69

1) ncidental. The organization accepts random coaching relationships with no attempt at vetting coaches or matching coaches to protégés. 2) Centralized. Coaching arrangements are handled from a central source, with guidelines and a budget. 3) Measurement. Metrics are established to determine the effectiveness of the coaching program. 4) Strategic. Coaching is part of a talent management program, linking organizational objectives and competencies. 5) World Class. Coaching is part of the company's culture; seen as an essential part of employee development; and practised regularly, both formally and informally.

Question 70

RESERVE FOR TABLE 7.4

Question 71

RESERVE FOR TABLE 7.4

Question 72

Sometimes companies press the fast-forward button for candidates to intentionally accelerate their development.

Answer 72

> These candidates are part of an acceleration pool and obtain assignments that offer the most intense learning and high visibility; > spend less time in assignments; > are given stretch assignments; > receive more training; > are given developmental activities designed especially for them; > are assigned a mentor; and > are not guaranteed promotion

Question 73

Companies that offer a variety of development opportunities establish reputations and often make the lists of "best companies to work for." In Canada, these organizations include:

Answer 73

> PepsiCo, IBM, General Electric, Procter & Gamble, Petro-Canada, and Manulife Financial

Question 74

Companies offer these experiences to become top companies for leaders:

Answer 74

> Working abroad/international experiences > 360-degree feedback to assess and critique leadership attributes, skills, and traits > Assessment centre solely for leadership development of high potentials > Mentor with admired senior leader > Rotational job assignments > Spending 10 to 24 percent of top leadership’s time on talent management issues > Organization has special/different career development process to retain high potentials > Organization prepares specific development plans for high potentials > Organization makes lateral moves attractive to high potentials

Question 75

What are effective measures of succession plans?

Answer 75

> Increased engagement scores > Increased positive perceptions of development opportunities > High-potential employees’ perceptions of the succession management process > Higher participation in developmental activities > Greater numbers involved in the mentoring process (Bernthal and Wellins 2006, 31–40)

Question 76

Nevertheless, there are internal ways to judge whether a succession management program is successful, including HR metrics, which may be viewed as lag measures, such as the following:

Answer 76

> Increased average number of candidates for key positions > Reduced average number of positions having no identified successors > Increased percentage of managers with replacement plans > Increased percentage of key positions filled according to plans > Increased ratio of internal hires to external hires in key positions > Increased retention rates of key talent > Increased percentage of positive job evaluations after promotion > More positive assessment of the quality of preparedness for new roles > Increased number of bosses skilled as talent developers

Question 77

one study found that the single most important driver of an effective plan was what?

Answer 77

> was that the executive team modelled the behaviour, believed in it, and held managers accountable (in performance reviews and bonuses) for developing employees.

Question 78

Another international study (Bernthal and Wellins 2003) surveyed thousands of leaders, employees, and HR staff from 117 organizations in 14 countries and identified the following characteristics as critical to perceptions of succession management effectiveness:

Answer 78

> A time frame for achieving planned action > Flexible adjustments to changes in strategic plans > Sharing of information about the nomination process performance and rankings with identified candidates > Visible support from top management > Involvement of line management in the identification and development of candidates

Question 79

top-down, organization-directed approach to succession management assumes what?

Answer 79

> assumes that employees are ready and willing to be prepared for the next generation of leadership > A top-down approach treats employees as pieces in a chess game. But employees are not pawns; their voices need to be heard.

Question 80

RESERVE FOR TABLE 7.81