Anticipating uncertainty: The strategic importance of succession planning in times of crisis
Anticipating uncertainty: The strategic importance of succession planning in times of crisis
A test of resilience for organizations
Crises of all kinds put the resilience of organizations to the test. Whether it’s an economic recession, a health crisis or a technological upheaval, these periods of instability expose companies’ vulnerabilities and test their ability to adapt. Yet too many companies wait until they’re in the midst of chaos to react, when one of the keys to overcoming these challenges lies in informed, proactive planning: succession planning.
North American companies are currently facing a particularly unstable economic climate. Economic tensions between the USA and Canada, combined with persistent inflation and labor market fluctuations, are creating widespread uncertainty. Several sectors are struggling to recruit skilled talent, and many companies are seeing their managers contemplate retirement, sometimes even early retirement. Against this backdrop, the need for a well-structured succession plan has never been more pressing.
Today, we have the opportunity to chat with Sylvain Brodeur, co-founder of iO4 and organizational guidance consultant. He shares his expertise and vision on the need to prepare the next generation, especially in times of crisis.
Q: Why is a succession plan so crucial in times of crisis?
Sylvain Brodeur: A crisis tests every aspect of an organization. It accentuates vulnerabilities, highlights dependencies and forces companies to react quickly. Without a succession plan, executives run the risk of making hasty decisions that can have serious long-term consequences. A well-established succession plan anticipates these challenges, ensures stable continuity and preserves the company’s strategic vision.
Take the example of the COVID-19 pandemic: many companies were caught unawares by a forced reorganization of work. Telecommuting, asynchronous working and remote team management became the new reality. The effects have been increased pressure on existing managers, opening the door to early departures of certain key executives. Organizations with succession plans in place were able to make a smoother transition, while others saw their productivity and growth severely affected.
Q: Many companies associate succession planning with simply appointing a successor. What do you think about this?
S.B.: This view is too simplistic. An effective succession plan is much more than simply appointing a person to take over from an executive. It’s a much broader strategic approach, touching on governance, talent management and organizational culture. It involves identifying key positions, developing the necessary skills, preparing for transitions and ensuring that the company’s values are integrated into future leadership.
If we take the example of the COVID-19 health crisis, organizations with a well-structured succession plan found it easier to reposition their emerging leaders. In hindsight, the ongoing development of a pool of key players enabled the succession to play its full role. This reduced dependence on a single leader and strengthened the organization’s resilience. This period of instability was transformed into a springboard for new strengths.
Q: What are the warning signs that a company needs a more structured succession plan?
S.B.: There are many warning signs, but it’s sometimes hard to see them in the hustle and bustle of everyday life. One of the most obvious is over-dependence on a key person. If that person were to leave, it would create a major void. Other signs include a lack of documentation of internal processes for key competencies, informal human resources management, or the absence of a clear strategy for the company’s future. If the company is not planning a leadership transition, this can also be a signal of vulnerability.
Q: Which industries are most at risk if they don’t prepare the next generation?
S.B.: In fact, let’s ask ourselves this question: what are the risks for an organization that neglects to implement a succession plan? All organizations are at risk! Certain industries such as retail, construction, professional services, agriculture and certain manufacturing industries – often family-owned – are particularly vulnerable if they don’t prepare for succession. These sectors rely heavily on key executives and specialized knowledge, and without proper planning, companies risk losing their expertise, their customer base and going through turbulent periods during transitions.
To overcome the financial challenges of implementing a succession plan, it’s essential to start early. Long-term planning allows you to spread out the costs of training, succession development and developing a structured plan. SMEs can also rely on grants, loans or partnerships to ease the financial burden, and implement succession gradually, aligning it with their financial cycles. At the end of the day, it’s better to invest in developing a resource’s skills and risk them leaving the organization, rather than not developing them and having them stay.
Q: What are the key steps in developing an effective succession plan?
S.B.: Each organization has its own particularities. Nevertheless, certain steps remain essential:
- Identify critical positions: Which roles have a direct impact on your company’s success?
- Identify future leadership profiles: Based on your strategic planning, what skills will you need to achieve your goals?
- Map your talents: Which employees show leadership potential? Who could progress to these key positions, and in what timeframe?
- Empowering existing managers: The person being considered as a potential successor is not solely responsible for his or her own development. It’s a shared responsibility: managers remain responsible for the development of their successors.
- Support the plan: That means investing. Not only in terms of money, but also and above all in terms of energy and time. This means setting up development and support programs, defining transition scenarios and running simulations or fictitious scenarios to validate the robustness of the plan. But above all, it means communicating clearly. A succession plan works when it is transparent and shared with stakeholders.
Q: What mistakes do companies often make in their succession planning?
S.B.: The biggest mistake is not to plan at all! But beyond that, some companies make the mistake of seeing succession planning as a one-off task rather than an evolving process. Another common pitfall is not involving stakeholders sufficiently in the transition, which can create internal resistance. Finally, some organizations focus solely on technical skills, forgetting the importance of interpersonal skills and leadership in succession.
Q: How do you balance succession planning with the day-to-day running of the business?
S.B.: Balancing succession planning with the day-to-day running of the business is a challenge, especially in sectors such as manufacturing, where operations must be maintained without interruption. The key is to integrate succession planning into day-to-day operations, without perceiving it as a separate task. It’s important to start planning early and gradually integrate it into day-to-day management. For example, by training employees in key roles while continuing to meet immediate operational needs. This enables succession planning without disrupting production processes. Planning must also take account of the company’s capacity and pace, so as not to overload it.
Q: What role do the various players play in a successful leadership transition?
S.B.: My answer to this question will be longer, as it’s a subject close to my heart! I invite you to take a good look at these next few lines. It’s a proven and effective guide.
Leadership transition in an organization is a crucial stage, often fraught with emotions and challenges, but also with opportunities. For it to be successful, it’s essential to take into account the effects it can have on all stakeholders: the organization itself, the managers in place, the employees who take over and those who remain.
On the organizational side, a well-prepared transition relies on a clear, shared vision of the future, a structured succession plan and rigorous processes for identifying, preparing and supporting future leaders. A culture that values evolution, talent development and transparency is a considerable asset. Conversely, a lack of planning, improvised choices or a culture focused on individual power can quickly undermine business continuity and corporate stability.
For existing managers, the transition can represent a delicate moment. Those who successfully pass on the torch are generally those who adopt a mentoring posture, who are willing to let go and who see this stage not only as a responsibility, but as a long-term contribution to the organization’s success. Conversely, behaviors such as withholding information, resisting succession or difficulty in letting go can create tension and hinder knowledge transfer.
Succession employees also play a key role in the success of this period. When they are well prepared, receive targeted training and personalized coaching, and are officially recognized in their new role, they are more likely to integrate quickly and effectively. However, if expectations are unclear, if support is lacking, or if the legitimacy of their appointment is contested, they risk experiencing a difficult transition, marked by insecurity, increased pressure, and even failure.
The impact of the transition on remaining employees should not be overlooked. Clear communication about the process underway, a message of stability and the involvement of teams in welcoming the next generation of employees will help to strengthen cohesion and maintain a climate of trust. On the other hand, a lack of transparency, decisions perceived as arbitrary or an impression of favoritism can generate uncertainty, demobilization and even unwanted departures.
In other words, a leadership transition isn’t just a name change on a business card. It’s a delicate passage that affects people, relationships and team dynamics. For it to succeed, it takes more than a good plan: it takes clarity, listening and courage. It’s often at times like these that an organization reveals its maturity, its ability to renew itself without losing its essence. Especially in times of crisis!
Q: How does iO4 help companies set up a succession plan?
S.B.: At iO4, we work closely with executives to build succession strategies tailored to their reality. We help them to identify their critical positions, structure their planning, set up talent development programs, and above all support the organization’s managers in taking charge and implementing this strategy. We use different tools to speak a common language, focused on concrete results. Our expertise in psychometrics, combined with our competency repository, enables us to assess the aptitudes of future leaders and ensure an optimum match between the organization’s needs and the skills of candidates.
Our approach is personalized, because every company has its own unique challenges. We support organizations every step of the way, from risk assessment to the actual implementation of the succession plan. We also offer training and practical workshops to help teams better understand and integrate the succession process.
The urgent need to act now
If current upheavals teach us one thing, it’s that unpredictability has become the norm. The companies that survive and prosper will not be those that improvise, but those that anticipate. Implementing a succession plan means investing in stability and continuity. It also means showing leadership by ensuring a smooth transition, whatever the turbulence ahead.
At iO4, we’re here to guide you every step of the way. Contact us today to ensure the long-term future of your organization, whatever the future may bring.