The #1 Way Great Firms Die (And How Yours Can Avoid Being Next)
10,000 baby boomers will retire every day for each of the next 13 years according to estimates from the Social Security Administration and the Pew Research Center.
That’s about 9 people per second, which means about 90 people retired in the time it took you to read this far.
Yikes! Let’s think about the gravity of that alarming rate for a moment. Especially how it relates to aging baby boomers within your business.
How many baby boomers do you have at the mid- or senior leadership level? How many are you grooming replacements for? Better yet, have you even hired that potential replacement or identified one internally?
Succession Is A Huge Problem. So What Are Leaders Doing About It?
A 2014 study conducted by The University of North Carolina’s Kenan-Flagler Business School and the Human Capital Institute (HCI) revealed that:
85% of respondents expressed an urgent need to step up leadership development
Only 21% of senior leaders were satisfied with their organization’s bench strength
Just 25% of senior leaders thought their high-potential employees currently were ready to meet their future business needs
30% of senior leaders believed their organization had a strong leadership pipeline (Filipkowski, 2014).
Studies have also shown it takes an average of 20.3 months to get high-potential employees prepared to assume a mid-level leadership position and 38.1 months to prepare them for a senior leadership position (Filipkowski, 2014).
This is essentially saying, “We know this is a giant issue we need to address, we’re not preparing the next generation of leadership and if certain people retired today, we’d be scrambling like chickens with our heads cut off.”
As further reinforcement, in our surveys of clients of professional services firms at Value Drivers, we’ve asked respondents about the strategic challenges they are facing. Their top mentions almost always include the following:
Attracting and retaining high quality talent
All of these are related. Because how does a business create profitable, sustainable growth without consistently having well-trained people throughout their organization who are ready to move to the next level?
The answer: It doesn’t. It’s a business that’s waiting to die. At a minimum, it’s a business that’s muddling along within the status quo, living off its name, its history and its press clippings.
The truth hurts. Yet there’s still time to right the ship for organizations that are committed to controlling their future or, better yet, making that future the best chapter to come.
Change Starts Today At The Top
Nothing will impact a business’ long-term success than ensuring the success of new leaders and high potential managers who are being groomed for roles of greater responsibility. Unfortunately, we’re seeing that 40%-50% of C-suite executives fail, quit or are pushed out during the first 18 months they are in their jobs.
Really? Up to 50% of C-suite executives fail? How do we beat those odds?
We can start by looking deeper at the behaviors that often derail an executive’s career. My book, Being A Leader With Courage: How To Succeed In Your C-Level Position In 18 Months Or Less (May 2016), speaks to nine of those derailers, including:
Coming in with the answer
Not honoring the organization’s culture
Sticking with an under-performer too long
Frankly, few leaders or up-and-comers know they’re exhibiting such behaviors. However, when they have the greater understanding of their blind spots, as perceived by others, it increases the likelihood of achieving essential personal and professional objectives.
It’s a win for the next generation of leadership. It’s a win for the culture. It’s a win for the long-term health of the firm.
It’s Time For A Plan. We’ve Got Just The Tools For It.
Our research for “Being A Leader With Courage” led to the creation of a self-assessment on the derailing behaviors as well as a 360 assessment that solicits feedback on a high potential leader’s behavior from his or her boss, direct reports, internal colleagues and external colleagues. This not only provides greater insights into how they’re perceived – it provides a roadmap for what they need to do to change it.
Now we’re excited to bring these insights and tools together in our Leading With Courage workshop, giving each organization a uniquely customized approach to preparing its next generation of leadership today.
To further reduce the risk that the retirement of your most experienced employees represents to your employees, customers and overall business, consider supplementing your current initiatives as follows:
Complete our Leading With Courage self-assessment – it takes just five minutes to fill it out, there’s no charge involved and you’ll gain amazing insight from it.
Share the link to the self-assessment with others in your organization.
Learn more about our 360 Assessment and then have the courage to ask others how you’re doing. Encourage others on your team to do the same thing.
Contact us about booking a Leading With Courage workshop for your high performing and/or high potential employees.
You know something needs to be done for your business’ future. So let’s make sure it’s not the next in a long line of great organizations that merge into another business or totally disappear. Make a plan for your long-term success through the steps above. If you have any questions, give us a call at 312.827.2643 or email us at Lee@valuedriversllc.com.