Login
Password

Forgot your password?

Ownership of succession planning program

By Edited Nov 14, 2015 0 0

If you ask the employees of a big corporation about the ownership of succession planning program, the employees will point to the Human Resource Department.

However, they fail to understand that Human Resource Department does not own the succession planning program. The Human Resource Department is merely the instrument to administer the process. It does not have the power to decide on the appointment of senior management team.

Who is the owner of the succession planning program? Is it the CEO and the senior management team?

If the CEO is the founder of the company, then he is the owner. However, in many big listed companies, the CEO is an employee. He does not have the right to decide his successor.

In this case, the ownership of succession planning program is with the Board of Directors.

The Board of Directors has the power to appoint and terminate the service of the CEO and the senior management team.

If the Board of Directors does not know the employees in the company, then the best succession plan does not work.

It is very unlikely for the Board of Directors to consult the Human Resource Department for the list of potential candidates for the role of senior management positions. In reality, that almost never happens. The problem is that HR Director does not have access to the Board of Directors.

That is why many corporations find themselves without a CEO should something happens to the current CEO. The Board of Directors can appoint someone as interim CEO. However, the search for the next CEO takes a few months.

This shows that the Board of Directors does not take ownership of succession planning program in the company. They do not trust the Human Resource Department to train and groom the next generation of leaders.

In some instances where the Board of Directors takes a direct interest in the leadership succession planning program, they know the ability of the employees well. They are very likely to promote someone from within the organization.

They are likely to appoint someone who reaches the senior management role from the bottom. They know and trust the employees. They have faith in the talent management process of the company, because they have direct stake in it.

The Board of Directors take an interest not just in the profit margin of the business. They take an interest in the employees, and they view the investment in employees from the long term perspective.

It is very likely that the members of the Board come from the senior management team. Some directors in listed companies ever served as the CEO or the CFO before they retired from active management of the company.

These are the companies with strong culture and history. The succession planning program ensures that everyone with the potential can reach the top position.

If you are working in such a company, you must bear in mind that the Board of Directors is the real owner of succession planning program. The Human Resource Department is merely the administrator of the process.

Advertisement

Comments

Add a new comment - No HTML
You must be logged in and verified to post a comment. Please log in or sign up to comment.

Explore InfoBarrel

Auto Business & Money Entertainment Environment Health History Home & Garden InfoBarrel University Lifestyle Sports Technology Travel & Places
© Copyright 2008 - 2016 by Hinzie Media Inc. Terms of Service Privacy Policy XML Sitemap

Follow IB Business & Money