by Lauren Keen, National Account Manager
The other day, a client told me how almost 30% of upper management at her company would retire in 2 years and 60% in 5 years! Her circumstance is not unique. The American workforce is getting older. According to the US Census Bureau, at least 10,000 baby boomers will turn 65 every day until 2030. The number of workers 65+ will increase by 75% by 2050, while the number of American workers aged 25-54 is only expected to grow by 2%. This older generation will be retiring soon, and they will take their expertise with them. All organizations need to make sure they have a pipeline of talent ready to fill the baby boomers’ shoes.
I made the following suggestions to my client to improve her company’s succession planning:
Offer the best on-boarding you can to ensure new-hire’s success and retention. According to the Aberdeen Group, 1 out of 25 employees will leave due to poor or nonexistent on-boarding. Don’t simply include compliance and IT training – you must also include cultural and/or mission, vision and values components so that the new employee starts to feel immersed in their new organization.
Not every employee needs an MBA, but everyone needs to know how they contribute to your organization’s bottom line. Therefore, they need to understand how your company makes money and how strategic decisions impact results. We call this business acumen; you may call it financial literacy, commercial acumen, knowing the business of your business, etc. The point is: everyone impacts the revenue, expenses and/or asset management of their organization.
When an employee transitions from individual contributor to front-line manager, do not assume he or she knows how to lead. Actually, don’t assume anyone who manages people has enough leadership skills—like conflict resolution, critical thinking, communication, coaching, change management, personal effectiveness, etc. It is imperative to nurture and grow these skills during your employee’s tenure.
The time is now to think about succession planning. These three steps will help you get started.