The Best Succession Plans are Those No One Notices

AdobeStock Photos

Succession planning often focuses on straightforward questions: Who is next in line? Who will replace the owner? Who will step into the president’s role? Who takes over when a longtime executive retires?

But during a recent peer-to-peer discussion among ASA’s Master of Distribution Management (MDM)  students, the conversation quickly moved beyond the C-suite; the students tackled a bigger question: How prepared is the entire organization for change?

One MDM student summed up the idea this way: if succession planning is done correctly, the transition should almost feel like a “non-event.” Employees understand what is happening. Customers know who to call. Vendors know where relationships stand. The next person has already been prepared. Business keeps moving.

A strong succession plan may be best measured by how smoothly the business keeps moving when the transition finally happens.

Succession is bigger than the top job

Several students acknowledged that they had previously thought about succession planning primarily in terms of CEOs, presidents or senior leaders, but the discussion expanded that definition.

One student noted that succession planning touches “all the employees” as well as a company’s top customers and vendors. Another pointed out that every important position should have some kind of backup plan, not just the highest levels of leadership.

That led to one of the most thought-provoking questions of the session:

“Which is more dangerous for your company: losing your number one customer or losing a CEO or president unexpectedly?”

The student acknowledged that there is no universal answer, and both would be devastating. But the question forces leaders to identify where the greatest continuity risks exist inside their businesses.

That risk may sit in an executive office, or it could also sit with a salesperson who owns the relationship with the company’s largest account.

Students discussed the danger of allowing one person to become the only connection between a company and a major customer. One participant suggested that another one or two employees should already be involved with those key accounts so the relationship can continue if the primary salesperson leaves unexpectedly.

The same thinking applies to vendors. If a critical supplier is acquired, goes out of business, or changes its relationship with the distributor, does the company have another option?

Succession planning, in that sense, becomes business-continuity planning.

Build the bench before you need it

Strong succession planning also starts much earlier than an announced retirement. One student connected long-term succession planning with a much more immediate question about what happens when a leader simply goes on vacation.

Can the team make decisions? Do people know whom to go to? Does the operation continue without interruption?

“If you have the short-term succession planning, odds are that long-term plan is easily going to fall into place,” the student said, explaining that employees should already have the background, development and confidence to make strong decisions when their leader is away.

Another student shared advice from an early manager:

“The best way to get to where you want to go next is to work yourself out of the job.”

In other words, leaders who want to advance should be developing someone who can eventually take their place. That requires more than identifying names on an organizational chart. It means actively and consistently developing people.

One MDM student described a quarterly succession-planning process involving HR. Leaders discuss who may be ready for future roles, evaluate employees across different skill areas and identify specific development priorities for the next quarter.

For example, if an employee wants to become a vice president someday, the question becomes: What experience or skill does that person still need to build today?

That ongoing process turns succession planning from an occasional leadership exercise into a regular part of talent development.

Know where employees actually want to go

Not every high-performing employee wants a management role. Not every warehouse employee wants to move into sales. And thus, not every potential successor identified by leadership actually wants the job.

One student described having longtime employees who were perfectly happy remaining in the warehouse until retirement, alongside others who were “eager and hungry” to advance. The leader’s job, he said, is to understand those differences and invest time accordingly.

Another student put it simply: “Our job is to help them get to where they want to go.”

That requires conversations about career goals before a position suddenly opens.

Along those lines, communication was one theme that surfaced repeatedly throughout the discussion. 

The MDM students agreed that poor communication creates uncertainty, and uncertainty creates its own problems. Employees begin wondering whether their jobs are safe, customers make assumptions, and vendors question what a leadership transition means for them. When companies do not provide answers, people create their own.

Students discussed how cross-training and early communication can make transitions much more seamless, making succession becomes less of an event and more of an ongoing process.

An outside salesperson preparing to retire should not wait until the final week to introduce a successor to customers. That next employee should already be participating in those relationships, learning the accounts, and building trust.

“You should never feel the gap that’s there,” one student said of a well-planned transition. “It should be seamless.”

Family businesses add another layer

Succession planning can become even more complicated in family-owned companies, where business decisions often overlap with personal relationships.

Students discussed the pressure family members may feel to prove they earned their positions rather than receiving them because of their last name. They also raised another important challenge: keeping talented non-family employees engaged when ownership may never be part of their future.

Several students emphasized that preserving a family company’s legacy does not automatically mean the next leader must be a family member.

Family members may not always agree on every decision, one participant noted, but they should be able to align around what is ultimately best for the company.

“You may not agree to everything, and you don’t have to,” the student said. “At least align your interests for the company and for the future of it.”

The conversation also explored the value of future family leaders gaining experience outside the company before returning.

Students said working elsewhere can expose future leaders to different systems and management styles, help them develop skills the family business may not currently have and give them the experience of succeeding without the influence of the family name.

Prepare for the change you cannot schedule

Students reflected on a case study involving an organization that unexpectedly had to activate an emergency succession plan.

The circumstances were emotional, but because the business had already planned for the leadership transition, it did not have to solve an organizational crisis at the same time.

One student described the lesson this way: “They had this laid out so they could handle the business without emotion. It’s just a process. It’s a procedure. This is what we’re going to do.”

The planning won’t lessen the emotion of the moment, but it will give the company a clear path forward and confidence in how the business would continue operating.

That is ultimately the goal of succession planning. When the right people are prepared, key relationships are shared and communication happens well before a transition, change becomes far less disruptive.

By Natalie Forster