A company I have been working with for 17 years has successfully navigated two major growth spurts, two recessions, grew from 35 to 6,000 employees, and added a Board of Directors. Despite the company's accelerated growth, it has only had two CEOs in that time, which is rare for corporate America. Additionally, retention rates have remained high all around. The company has successfully avoided risk and maintained a high talent bar.
What is the key to their success? A strong focus on talent management with a one-two punch of annual talent reviews and succession planning.
Annual talent reviews
The strength of any business lies in its human capital. Successful businesses know this and act accordingly. It’s critical to have a deep understanding of your collective talent pool and assess this annually with talent reviews. One resource I recommend is the nine-box performance and potential matrix. Using a low, medium, and high ranking, performance is measured on the horizontal axis and potential on the vertical. Performance is relatively easy to assess but potential is often more difficult. Potential is a combination of three important ingredients:
Aspiration: Does the employee exhibit a desire for growth and advancement?
Ability: Is the employee change agile, inquisitive and creative, a problem solver/critical thinker, people savvy, and an effective communicator?
Engagement: Is the employee a continuous learner and organizationally aware? Does the employee exhibit energy and drive, as well as presence and command?
The nine-box matrix enables organizations to identify their highest potential individuals. It also allows them to identify development opportunities for performers at all levels.
Businesses are fluid and dynamic entities, making it difficult to predict changes such as resignation, termination, illness, and retirement. It is critical that organizations prepare for these changes with contingency plans and succession planning. For each key incumbent, organizations should identify at least one potential successor. Then assess readiness for the role, the risk and probability of loss, and outline recommended development opportunities to ensure a seamless transition from one leader to another.
Together, talent reviews and succession planning are a powerful combination to drive stronger, more effective organizations. With a clear understanding of the human capital that makes up an organization, contingency planning ensures the road ahead is clear.
Nadine Greiner, Ph.D. provides Executive Coaching and Human Resources solutions. Her mission is to make the executive experience exceptionally enjoyable and effective. She believes that the world needs great leaders, and has dedicated her career to helping them.
As an organization psychologist and former corporate CEO, Dr. Nadine understands the pressures and demands executives face. She offers her clients the high expertise that only comes with three decades of consulting success, and a dual Ph.D. in Organization Development and Clinical Psychology. Dr. Nadine is an in-demand speaker, teaches in doctoral programs, and coaches other consultants. She is the author of two books: ‘The Art of Executive Coaching: Secrets to Unlock Leadership Performance’, and of ‘Stress-less Leadership: How to Lead in Business and in Life’. amazon.com/author/nadinegreiner