candidates within the firm and develops them over time, Hall said. For example, Hall uses a onethree-five-year system to develop potential successors in the near and medium term. A solid evaluation process is needed to determine who the candidates are and what development they need to succeed in senior roles, he added. “Good succession plans within an organization have a mentoring component,” Hall said. “They have what are called organizational internships, where individuals have an opportunity to lead in other areas that they may not currently be in, 10 / ADVISORS MAGAZINE
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but which they are being groomed for or which they have an interest, and this is all handled within the organization.” At South Carolina, potential executive candidates run through a number of “internships” within the firm. New roles also come with a “transition period” in which the newcomer observes, asks questions, and gradually takes over the position. This ensures that operations continue with minimal disruption and eases the learning curve on new senior managers, Hall said. Firms should evaluate how individuals manage themselves, lead others, represent the firm, and achieve organizational objectives. Without knowing the baseline, a firm cannot determine who to develop into the next generation of leaders. With it, however, the organization can begin sorting the leaders from the rest, and building a more efficient, competent firm. The firm also needs to reinforce that no position represents the “end of the line,” and instead push for performance at every level. “People should earn their jobs every day,” Hall said. “If the succession [system] has that mentality
in place, then individuals will continue to perform.” Performance depends on culture as well. The old adage that “culture eats strategy for breakfast” still applies today. The firms that build effective workplace cultures should be able to withstand major transitions and identify the “bench” before succession becomes an urgent problem. Firms with weak institutional cultures should start there, and work to develop the traditions, attitudes, and values that can guide the organization – once the values are identified, other issues can begin to fall into place. “It’s about creating sustainability, and that’s what succession is, it’s sustainable,” Hall said. “Having a succession plan is a strategy, but having a culture is a way of life.”