Business Succession Planning For Dummies^®

Business Succession Planning For Dummies^®

by Arnie Dahlke

Business Succession Planning For Dummies^®

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About the Author

Arnie Dahlke has a PhD in psychology from the University of Minnesota. Over the years, he has taught full time in both psychology, business, and organizational development departments, served as a director of research for the American Institutes for Research, and worked as an independent consultant.

Arnie has assisted both private (for-profit and nonprofit) and public organizations, using coordinated team-building strategies and process-improvement tools. He brings people together in a spirit of mutual trust, cooperation, and constructive problem solving. As described on his website (www.arniedahlke.com), he helps people in organizations cultivate both continual improvement and customer-responsive mindsets.

Arnie’s private-sector clients have included larger corporations, such as Chevrolet, Saturn, Coca-Cola, Gelson’s: The Super Market, and Northgate Market; healthcare facilities, such as counseling centers and Northside Hospital; smaller organizations, such as the law firm of Ferruzzo & Ferruzzo, Able Computer, New Media Broadcasting Company, The Party Staff, and Your Staff; and automobile dealerships representing a variety of franchises, including Chevrolet, Chrysler, Ford, Honda, Infiniti, Mitsubishi, Nissan, and Toyota. His work has helped companies win national awards. As a consultant to the Human Interaction Research Institute of Westwood, California, he conducted interviews in California, Missouri, Nevada, Texas, and Utah at local community mental-health centers for the purpose of identifying the factors that go into the sustaining or non-sustaining of innovative procedures in organizational settings.

Arnie’s public-sector clients have included both cities and county departments. He has assisted city- and county-management staff, police departments, libraries, and planning and public-works departments in such cities as Washington, D.C., and Los Angeles, Santa Ana, San Bernardino, Santa Rosa, and Torrance, California.

Throughout his career, Arnie has kept alive his love for teaching. He has taught courses and seminars in psychology, organizational behavior, and organizational consulting. He has taught at all levels, from adult students to college freshmen to graduate students at many colleges and universities, including Antioch University, the California School of Professional Psychology, Marymount College, Phillips Graduate Institute, Ryokan College, the University of California, the University of Maryland, the University of Minnesota, the University of Nevada, and the University of Oklahoma.

Dedication

I dedicate this book to all employees, because their morale and futures are dependent on the quality and successful implementation of succession plans in their organization.

Author’s Acknowledgments

I appreciate the help of everyone who has helped me put this book together. It has been an exciting, although somewhat exhausting, experience, and it’s taught me that you never know how much you know until you start putting it down on paper. I was surprised to find how much I know.

A special thank-you first to my brilliant in-home editor, my wife, Lesli, who pays attention to the slightest detail and improves what I do in subtle but dramatic ways. She has tirelessly supported my efforts through thick and thin, including very long hours spent writing.

I also want to thank Erin Mooney at John Wiley & Sons for giving me the opportunity to write this book; Ken Lloyd for his insightful comments and technical suggestions; and Elizabeth Kuball for her patience, helpful suggestions, and meticulous editing.

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Introduction

People come and people go in every organization, from large corporations to small family businesses. Some departures are planned and some are unexpected. Your innovative CEO retires. A key programmer in your IT department decides to take a job elsewhere. Your CFO has a heart attack.

When key people leave your organization, you’re faced with the task of replacing them. If you have no succession plan in place, a departure can cause waves of disruption to spread throughout your organization. But if you’ve taken the time to lay out a careful succession plan, the departure may be a mere ripple. It’s up to you.

About This Book

I wrote this book to help you develop and implement a fully functioning succession plan. Business Succession Planning For Dummies includes a wide range of tips, techniques, and strategies for defining your succession needs, identifying and developing successor candidates, and effectively bringing them onboard.

Every chapter in this book stands on its own. You don’t have to read the book from beginning to end. Simply choose the chapter that fits your needs, and dive in!

Conventions Used in This Book

I use the following conventions throughout this book to make the material easy to understand:

All web addresses appear in monofont. When this book was printed, some web addresses may have needed to break across two lines of text. If that happened, rest assured that we haven’t put in any extra characters (such as hyphens) to indicate the break. So, when using one of these web addresses, just type in exactly what you see in this book, pretending as though the line break doesn’t exist.

Bold is used to highlight the action parts of numbered lists.

When I introduce a new term, I italicize it and define it shortly thereafter, often in parentheses.

Foolish Assumptions

As I wrote this book, I made some assumptions about you, my reader:

You’re a manager or human resource professional, and you want to implement a long-term succession plan for your organization.

You want a smoothly functioning organization today and in the future. You know problems will occur. You know people will come and go. But you value doing whatever it takes to be prepared.

People are your most important resource. Yes, you need to make a profit. Yes, your long-term success depends on having a stable customer base. But it’s your people who make those things happen.

Key positions exist throughout your organization. Yes, the loss of your high-powered CEO would be very disruptive. But your organization also would suffer if it lost other key talents: the IT specialist, the brilliant CFO, the star salesperson. . . . People in many key positions make major contributions to your organization’s success.

You see the value of having the right person in a key position. You’d rather have the right person in the right job than place a person in a position and hope that things work out. You believe that having the right person in a key position is critical to your organization’s success.

You see the importance of planning. Yes, planning takes time, and people are busy doing their regular jobs. Nonetheless, you recognize the importance of planning now in order to avoid problems in the future.

You need some help. You’ve tried to develop a succession plan. You may even have one halfway finished. Or you may have a finished one that just doesn’t seem to be working the way it should. Whatever the case, you need some help.

How This Book Is Organized

Business Succession Planning For Dummies is divided into five parts. Here’s what each part covers.

Part I: What Is a Succession Plan, and Why Do You Need One?

This part is focused on the importance of having a well-developed succession plan. Here I tell you why you need a succession plan in the first place and which type of succession plan you need. I also tell you some of the consequences of not having a succession plan and some of the benefits of planning (in case you aren’t convinced that succession plans matter).

Part II: Creating a Plan and Putting It into Action

This part is focused on the mechanics of preparing and implementing a succession plan and monitoring and evaluating its success. Here I tell you how to build your succession-planning team, establish the specific goals of your plan, successfully implement your plan, evaluate the plan, and handle obstacles along the way.

Part III: Diving Deeper into Succession Planning

In this part, I show you how to customize your succession plan for various key positions. You find out how to determine the competencies needed for those positions, as well as develop the competencies of potential successors within your organization. Finally, this part shows you how to ensure a smooth transition.

Part IV: Keeping the Succession Ball Rolling

Your work isn’t over after you’ve written your plan. You need to make sure that your plan is well maintained and able to adapt to changes in your organization, its marketplaces, and the economy and society at large. In this part, I tell you what you need to do before, during, and after someone’s exit. I explain how to identify changes taking place in the workplace and determine the impact of those changes on your organization. Finally, I guide you through adjusting your succession plan in response.

Part V: The Part of Tens

Every For Dummies book ends with a Part of Tens, and this book is no different. In this part, I provide ten common mistakes to avoid and ten ways to keep your plan alive.

Icons Used in This Book

Throughout this book, I use three icons to highlight different kinds of information. Here’s what they mean:

You don’t have to memorize the information in this book — there is no test at the end — but the Remember icon highlights important information that’s especially worth remembering.

The Tip icon points out information that makes the planning process more efficient or just plain easier.

The Warning icon draws your attention to potential pitfalls and danger spots that crop up when implementing a succession plan. Forewarned is forearmed.

Where to Go from Here

If you have no succession plan presently in place, not even a partial one, Part I is a good place to start. If you already have a plan in place, which chapter you’ll want to read depends on your needs. For example:

If you’re having difficulty implementing your existing plan, take a look at Chapter 5 for suggestions on how to make it work and Chapter 7 for tips to overcome implementation obstacles.

If you’re concerned about the degree of your success in implementing your plan, take a look at Chapter 6 for some tips on monitoring and evaluating your plan.

If you need more ideas for identifying and developing successor candidates within your organization, spend some time reading Chapter 10.

When in doubt, the table of contents and index make it easy to find the information you need.