In early 2021, we wrote about the key shifts needed in succession planning to build more robust and diverse leadership pipelines. Over the past several months, we have surveyed over 40 Fortune 500 companies on their current succession planning approaches. The result? Sadly, there is common acknowledgment that it’s not going well. There continue to be widespread problems in how organizations plan for and develop their senior leaders.
Lack of Robust Leadership Pipelines
In uncertain and volatile times, what we can be certain about is that things will change. People will leave, markets will shift and positions will open. All too often, we’ve seen companies scramble when someone in a key position resigns, leading to emotionally-driven and gut-level decisions on a replacement who may well not be prepared for the role and doesn’t have the network in place. So where are we on the goal of having solid candidate pipelines? Only 16% of respondents agreed they have a robust pipeline of candidates for key roles.
In fact only 14% of respondents said they have objective processes to evaluate and select successors for open roles, including leaders with non-traditional backgrounds.
Little Progress on Leadership Diversity and Development
When it comes to the diversity of corporate leadership pipelines, only 9% described their pipelines as adequately diverse, meaning that a whopping 91% did not. This statistic suggests that there is likely little intentional development of potential diverse senior leaders, leaving a lack of prepared diverse candidates when leadership positions open up. And research tells us that diverse employees are less likely to have a sponsor at work to advocate for their advancement.
With only 19.5% of respondents using data-driven methods to assess what development successors may need, there is little rigor to provide leaders with accurate self-assessments and the targeted development experiences to prepare them for higher-level roles.
Most companies still have a tremendous opportunity to rethink succession planning systems to create the robust and diverse pipelines that will be able to lead us into the future. Check out our recommendations here.