A Non-Profit’s Succession Plan: The Strategy of Leadership Development

The best way to reduce the effect of lost talent and underdeveloped employees is to take the time to develop a leadership-based succession plan that focuses on developing and mentoring the next generation.

Jim Bitterle, EDSI Managing Partner and Succession Planning Expert

Do you have the next generation of employees ready to step into the shoes of those who are exiting? Are they prepared to take on roles and responsibilities at all levels of your organization?

Many companies still limit their succession planning to simply identify potential successors for C-level positions. They do not consider succession planning to be a leadership development exercise or a tool for engaging and keeping top talent.

Effective succession planning is not just a replacement planning process. A comprehensive employee development system is required to ensure that there is no leadership vacuum in the organization after the CEO or another important role steps down. However, leadership development and succession planning are often viewed and treated as separate activities. They should, however, go hand in hand, or even be considered two sides of the same coin. You can’t have an effective succession plan unless you’re constantly identifying, assessing, and developing high-performing, high-potential employees in your organization and grooming them to take on more responsibility.

Nonprofits that are serious about their own sustainability will plan for smooth and thoughtful leadership transitions, as well as make sure their organization is prepared for unexpected departures. Succession planning and leadership development are inextricably linked in the pursuit of one fundamental goal: business continuity and the organization’s long-term legacy through homegrown leaders. If succession planning and leadership development are linked perfectly, consider it a best practice for the long-term viability of your organization.

DEVELOPING LEADERSHIP SKILLS

Many leaders today are promoted after excelling in an individual contributor role, rather than through formal leadership skills development or training programs. Because of insufficient preparation, new managers may struggle in their roles, potentially resulting in turnover, employee performance issues, and other leadership issues.

Leadership development is a key component of succession planning in any organization. Nonprofit executives should provide aspirant leaders with the support and resources they need not only to broaden their skills and advance into leadership roles but also to prepare them to fill key roles in the future and help the organization as a whole succeed.

Here are the simple five steps for successful leadership development:

(https://www.edsisolutions.com/blog/)

1.Document current and future organizational structures

Map out your organizational structure as it is now and project how it might look several years from now. Consider your future goals and the types of leadership and positions you need to reach those goals.

2. Identify and define capabilities for key areas and positions

Assess and designate those that are critical to the organization’s operational activities and strategic objectives. Determine specific functions and update job descriptions.

3. Pinpoint Interested employees and assess them against capabilities

Meet individually with those who have the interest, knowledge, and potential to fill key areas and positions.

4. Identify knowledge loss risks and priorities

Set strategies for learning, training, and development. Develop and implement succession and knowledge transfer plans, preferably with leadership buy-in.

5. Evaluate the effectiveness

Measure and monitor your succession planning and management efforts to ensure functionality and goal attainment. Consider assigning a process champion who will hold people accountable for tasks related to the implementation plan.

By implementing a multi-level, leadership-focused succession plan, your organization will:

Build a pipeline of high-quality candidates for critical positions
Develop the competency and retention of your most valuable talent
Offer opportunities and incentives for top talent to remain dedicated
Avoid costly interruption of work if/when critical talent resigns
Minimize the threat and high cost of turnover

A Call for Nonprofit Risk Management

Every opportunity that a nonprofit is presented with is fraught with danger. Incorporating executive transition carries some risks, which some nonprofits cannot recognize. Risk management is essential to reduce, anticipate, mitigate, and manage the challenges associated with the leadership transition. You do not want to incur significant costs because of poor leadership transition, such as low productivity, turnover, and staff dissension, all of which are threats and risks to an organization’s success. As a result, a forward-thinking organization would have recognized already the growing importance of treating leader onboarding as a risk management process.

It would be great to be able to pursue your organization’s goals at full speed without having to worry about risks. That is something that the HWA Alliance of CPA Firms can make a reality. Our professional risk management team has developed an effective risk management program that can provide reasonable assurance that an organization will remain agile and responsive in the face of risks and uncertainty. HWAA’s sound risk management approach will help nonprofits weather transitional challenges and better identify and mitigate their unique risks, ensuring the safety of the organization’s capital, earnings, and success.

We would be pleased to meet with you to identify threats and discuss solutions for your nonprofit leadership transition and succession planning, ensuring that your organization is on track for success.

– John R Wright, CPA

#HWA #HWAA #Succession #NonprofitSuccession