Ask This Question BEFORE Starting Your Succession Plan

Imagine for a second that some of your top executives would be departing from your organization.

Through retirement, or illness, or some other unforeseen circumstance. What kind of ripple effect would that have on your organization?…

And imagine if that wasn’t addressed. Even worse, imagine if that next level behind those executives doesn’t have succession planning in place as well.

What kind of impact will this have on future earnings?

Well, you don’t have to imagine very long because regulators are telling us right now that it is one of the most important—in fact, one of the top 4 things—banks should be addressing.

Now, a good succession plan doesn’t mean writing something on a napkin.

The American Management Association took a survey of leaders, and 71% of leaders said that succession planning is more critical than ever.

But here is the frightening part:

Only 14% feel that they are prepared. 1 in 5 says they haven’t begun to have any preparation at all.

It is a national epidemic issue that needs to be addressed—soon for you to make sure that you have safety and eliminate some of the enterprise risks that you have for your bank right now.

So when grooming your future leaders, it’s imperative that you are 100% authentic in sharing with them exactly where the gaps are in their knowledge and their ways of being. If that isn’t addressed, they are not improving.

But just bringing it to their attention isn’t enough; they need to have the education. Many have been taught management skills. Still, executive skills are a very different set of skills. And, excruciatingly important as a bank goes to the $1 billion and $2 billion marks because many of our CEOs start with a $200 million bank, and suddenly, their people will soon be running a $1 billion or $2 billion bank.

The need for extreme leadership development and knowing how to think and execute like an executive is imperative for a bank’s security into the future.

So when is a good time to start?

I recommend you start now to build your pipeline by:

• Identifying the right next people
• Making sure you know their emotional intelligence scores to get them into the right slots
• Begin their grooming training
• Make sure that the procedures are written up for their particular hats that they own
• And most importantly—that you have a plan to make sure that your best people don’t leave you as a result of those authentic communication pieces.

It’s a tricky piece; it’s an important piece…but it’s not something that can be delayed just because it has some dangers.