Build Your Own Talent and Reap the Benefits

This article appeared in People and Management Magazine September-October issue.  I will become a monthly columnist writing articles centered around Organizations, People & Talent.

Succession planning is always unfairly coupled with the executive suite. When we think of the word, we right away envision a pool being groomed for the C-Level. Succession planning must be permeated throughout the organisation. From the marketing manager to EVP/CMO, every new hire must be looked at through the lens of replacement


What do Proctor & Gamble, JC Penny, Best Buys and Xerox have in common? They all have had recycled CEO’s. The wunderking that was at the throne was replaced by the prior wunderking! Now tell me what is wrong with that picture. Where is or was the strategy succession? So if the plan did not work, why and more importantly what are you going to do about it?

However, there have been instances of success when this model has been used so it is not always a total disaster. The most famous examples include Steve Jobs at Apple and Howard Schultz at Starbucks who came back riding to the rescue, cape & all and saved their company from the grips of decline.

How could this be? Succession planning as an organisational tool has been around for decades. How could these major companies not have a talent marketplace in place? Why would they go back to the tried and true especially in this era of innovation?

Today in organisations, there is a lot of lip service paid to initiatives. But is it really believed? Is organisation leading the way in setting example at all levels? Are people involved in the succession planning process believers? If you were in one of the former companies above, your trust level probably dropped when these maneuvers took place.

Recruiting Strategy meet Succession Planning

In order for a company to Live, Eat and Breath an initiative, it must be embedded through the company. The recruiting strategy must be run with a mission to hire the replacement. Sometimes, this may not be viable, but at the least every new hire must have to band-with to compete for the next opportunity within the organisation.

Succession planning is always unfairly coupled with the executive suite. When we think of the word, we right away envision a pool being groomed for the C-Level. Succession planning must be permeated throughout the organisation. From the marketing manager to EVP/CMO, every new hire must be looked at through the lens of replacement. Do they have bandwidth to move to the next level?

Hire for the Future

Having this mindset to permeate, an organisation from highest level to manager level creates a united sense of purpose throughout the enterprise. Major league sports team recruiting model is based on this concept. When and if you are drafted, you come in slotted within a certain position. If your organisations use a similar model, C-Level succession would be a second thought; it would become automatic.

This would require job descriptions to be rewritten for a new level, as today they are focussed only on the current state of job. However, the focus should be changed to future state, where the job is to be headed, in the next few years. This change in focus would cause the level of talent coming into the organisation to be filtered to the extent that we begin hiring the organisation’s future.

This new wave of hiring to the future would mean bringing in individuals to enable the organisations to meet their goals.

Who’s to Blame for Non-succession?

If the market and organisation is in a disruptive state and has not settled; do you have the talent to work in this status and do they have the capabilities to lead with uncertainty. If the argument is that we do not have the talent in-house, then this alone should tell you about your hiring strategy. Those people that you have and whom you do not consider at the appropriate talent level, did not just walk through your doors. They were recruited by you. Your organisation had hired them.

A recent study by the Wharton School of the University of Pennsylvania by Dr Matthew Bidwell found that external hires get paid 18 to 20 percent more than internal employees do for the same job, but they get lower marks in performance reviews during their first two years on the job.

Not only were outside hires more expensive, but they were also 61 percent more likely to be laid off or fired from that position and 21 percent more likely than internal hires in similar positions to leave a job on their own accord, Dr Bidwell found.

He noted that external hiring has become more prevalent in the past three decades, especially in large organisations and for high-level positions. But he said that companies should spend more time figuring out how to promote from within.

“We all have experience in hiring managers and may be tempted by a fresh perspective or a prestigious résumé, but they underestimate how hard it is to integrate new people,” he added.

Build vs Buy: You Decide

Yes, these hires from the outside tended to be better credentialed: education and experience. But the drawback is that they did not always equate to strong performance. Think of the examples used above.

These hires are coming into a new company culture. While they may have thrived in the culture that the previous success was hatched; it is not transferrable. There have been numerous examples of culture rejecting leaders.

By contrast, workers promoted from within have valuable firm-specific skills that can be translated into better performance reviews. So the dilemma, organisations are facing, is how they embed their organisations into a talent marketplace where they can harvest as and when needed.

There are numerous advantages of building your own talent in-house:

• Build talent as per your blueprint

• Create a talent marketplace which increases engagement

• What you see is what you get – as you know them already

• Hit the ground at top speed - no ramp up time

• Building is saving, it’s a lot cheaper when they are in-house

Any way that you slice it, building talent in-house is a win-win situation for both organisation and employee. If you build it; there is less of a learning curve when moving people into a new role or added responsibilities. They will not need to learn ‘‘how we do things round here’’ – instead they can focus on what they need to do to be successful in their role.

By promoting people from within, you provide more opportunities for people from within the organisation to grow, develop and move on. That increases the likelihood that talent will be engaged, will stay and will explore where their next opportunity is inside the organisation rather than looking outside.

For this concept to work, the organisation needs to be clear about what skills and behaviours it will need for the future and has the tools, resources and genuine commitment to develop people to meet that spec. A strong commitment to developing the workforce is a must for this initiative to work.

So the decision is yours. You can start to build it and they will come. Why do you think companies like Google get so many resumes, it is because they build from within.

The choice is yours: Start building