Leaders

Leaders Don't Grow on Trees...

But they're right in your firm's backyard.

Recent trends show that large numbers of CPA partners may soon head into retirement. As a result, many firms may be left with significant gaps in their leadership pool and rising concerns about the availability of quality leaders for their future. This could be why "succession planning" is heard more and more around your office.

Succession Planning for Leadership Development
Succession planning is the increasingly important process of determining critical roles, and preparing suitable employees with appropriate skills, for present and future opportunities within a firm. Succession planning ensures that there are highly qualified people in all positions, today, tomorrow and years into the future.

With the pending departure of Baby Boomers from key leadership positions, CPA employers are thinking more about who will be replacing valuable employees, and how it will impact their business. If you're among the growing number of those concerned, you may consider making succession planning a higher priority on your "To Do" list.

Though passing the baton to future leaders is a key occurrence in a firm's life span, succession planning is not one single event that happens only during transition of ownership. It should be an ongoing, integral process that impacts every part of your business.

You can use the succession planning process to take a more strategic approach to leadership development, employee skill assessment, and - as Baby Boomers retire - preserving critical firm knowledge. A succession plan is a map for your firm to groom high-potential employees for new leadership roles as opportunities arise. It prepares an employee to step into a leadership or management position, hit the ground running, and sustain continuity and effectiveness at all levels. It also demonstrates a firm's commitment to and interest in retaining an employee.

It may seem challenging to consider what your business will look like in 10 or 20 years. But in order to remain competitive, you need to identify who is ready now and what it will take to make others ready when your firm needs them. A succession plan helps you do that.

Traditionally, succession planning helps to answer the questions: "Who are the future leaders of the business? What impact will a change in ownership and leadership have on the firm?" And, in today's business climate and looming leadership deficit, CPA firms are looking to succession planning as a useful tool in the consideration of key employees in a variety of positions, replacing managers at all levels in a firm. It's not just succession to the top, but a holistic approach, putting the right person in place for every job. Some of your firm's future jobs may not exist now. If your firm plans to expand, or add competencies in the next several years, you may require additional managers with new or different skill sets.

You should initiate a succession strategy that is fully aligned with your firm's future business needs. That is why effective succession planning and good leadership development must be based on a clear understanding of the business strategy both now and in the future. These requirements must be mapped with information about individual employees: biographical details, technical and professional skills, core competencies, and knowledge for current and future positions. (Firms often enlist the expertise of outside consultation or acquire tailored software packages for their succession planning process.)

In addition to the traditional purpose of replacing leadership positions, succession plans can help you achieve a number of more strategic objectives by creating a platform to*:

"Improve your recruitment process for key positions
Track active development of longer-term prospective successors by ensuring their career growth and analyzing responsibilities, skills, and knowledge required for your firm's future
Review the talent pool for the allocation of responsibilities and development of strategies, and fill the identified talent gaps
Build a talent resource of employees who share core skills, knowledge, experiences, and values that are important to your firm's future
Understand how a business strategy translates into skills, knowledge, and core competencies required
Attract, recruit, and retain knowledge and skills, not just fill jobs
Track knowledge and competencies effectively, and identify where gaps exist between current and future requirements
Develop a culture of continuous learning and growth for both individuals and the firm"

Whether you are prepared to take a formal approach to succession planning or not, by incorporating a conceptual framework of succession management, you can begin to create a stronger, more loyal base and set the stage for present and future opportunities.

Looking forward in a challenging economy, succession planning will continue to become more integrated into the daily initiatives of CPA firms. It is becoming a part of a strategic mindset in daily business that meets business needs of the future.

*Source: http://www.successionplanning101.com

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The Benefits of Succession Planning

More and more, CPA firms recognize that a defining characteristic of their enterprise is human, rather than financial or geographical. They understand their culture is driven by the values and vision of its leaders, and creates the foundation for the future generations.

In addition to the traditional replacement of leadership positions, succession plans can help you achieve a number of more strategic leadership management objectives by creating a framework to:

Translate your business strategy into skills, knowledge and core competencies needed for your current and future business
Increase your readiness for leadership
Hire, promote and retain key positions more effectively
Track the development of successors by creating a clear career path, and identifying roles, responsibilities and performance objectives for your firm's future
Create an active talent pool - attract, recruit, and retain knowledge and skills, not just fill jobs
Track skills and competencies accurately and see where gaps exist between current and future requirements
Foster a culture of continuous learning and development for both individuals and your firm

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Leaders Don't Grow on Trees...