succeeding at successionchallenges facing smaller banks 21 loyalty/stickiness mobility/p2p payments...
TRANSCRIPT
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Iowa Bankers Association
Annual Convention
2018IMPACTING PEOPLE LLC 1
Succeeding
At
Succession
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Agenda
1. Levels of Succession
2. The People Portfolio
3. Succession Management
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Levels of Succession
1. Ownership
2. Board
3. CEO
4. Key Positions
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Ownership•What is the ownership structure today?
•How might it change going forward?
•What is the end game?
•In what timeframe?
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Board•Is there a Plan?
•Are the needed skills, knowledge and qualifications known?
•What structure is needed for the Bank today? Future?
•What is the recruiting strategy?
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CEO Succession
•What is the timeframe?
•Is it “succession” or “replacement”?
•What are the needed skills, knowledge, abilities for the next CEO?
•What is the long term strategy of the Bank?
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CEO Succession
Succession•18 months or more in the future
•Determine who owns the process (Board, Board Committee, Family, etc)
•Determine Profile for the future CEO position
•Define the potential internal pool
•Evaluate/assess internal talent
•Recruiting strategy and On-boarding process
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Key Position Succession
•Determine key positions to include
•Determine internal candidate pool
•Assess internal candidates/talent
•Commit to Development
•Connect to Annual Goal Setting and Strategic Planning
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Components of a Succession Plan
1. Organizational Summary of key issues and risks2. Current Organization Chart (Mission Critical
Positions)3. Current Job Description(s)
◦ Key responsibilities and accountabilities◦ Competencies needed for success◦ Qualifications
4. Readiness Chart(s)5. Profile(s) of potential successors6. Development Plans for potential successors
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Do You Agree?
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People are your most valuable asset!
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Asset Management:•What are the assets in the portfolio?
•How robust is the portfolio, monitoring systems, portfolio reviews?
•How clear are the roles, responsibilities, and accountabilities?
•How much time is dedicated to managing the assets?
•What are the needed qualifications of people in charge of managing the Assets?
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Capital Adequacy
What do you know about the portfolio?
Is the Bank . . .
⚫Well capitalized?
⚫Adequately capitalized?
⚫Under-capitalized?
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People Portfolio
• Portfolio Content
• Quality
• Monitoring Systems
• Portfolio Reviews
• Compliance
• Active Management
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Know Your Bank’s People Portfolio
• Content and Quality• Expense and Investment Needs• Results of Monitoring Systems• Drive timely reviews and
agendas• Compliance• Active Management
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Talent RiskFour Kinds of Talent Risk•Vacancy Risk – risk of critical leadership
positions being vacant
•Readiness Risk – risk of underdeveloped successors
•Transition Risk – risk of poor assimilation of executive talent
•Portfolio Risk – risk of poor deployment of talent against business goals.
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Why Now?
Competitive Changes◦ Economic rebound – more opportunity◦ Human capital as a differentiator
Labor Market Changes◦ Demographic trends◦ More dynamic labor markets
Organizational Changes◦ New organizational structure◦ New focus on leadership and governance
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Workforce Trends
1. Changing Models of Work: Employees will work in more decentralized, specialized firms, and employer-employee relationships will become less standardized and more individualized.
2. Greater Diversity: Slower labor force growth will encourage employers to adopt flexible approaches to facilitate greater labor force participation among women, the elderly, and people with disabilities.
3. Automation, AI, Digital World: Greater emphasis will be placed on retraining and lifelong learning as the U.S. workforce tries to stay competitive in the global marketplace and respond to technological changes.
4. Income: Future productivity growth may support rising wages;may affect the wage distribution; the tie between employment and access to fringe benefits will be weakened.
Source: The Future at Work – Trends and Implicationswww. Rand.com
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The Business Case
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Iowa Statistics
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Iowa Statistics
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Challenges Facing Smaller Banks
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Loyalty/Stickiness
Mobility/P2PPayments
Relevance
Limited Menu of Fee-Based Products
Complexity
Consistent Earnings Stream
Succession
CapitalLarger, Low-Cost
Distributors
Talent
Branch Structure
Overall Efficiency
EmergingChannels
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Cost of Technology
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Bank Strategy
Linking Bank Strategy and the People Portfolio
The Human Organization(People Portfolio)
HR StrategiesAnd Practices
Criteria
Criteria
Create
Implement
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“People aren’t a company’s most important asset . . .
the RIGHT people are.”
– Jim Collins, Good to Great
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Succeeding with Succession
An integrated set of proactive processes that identifies and prepares successors for key roles needed to deliver the business strategy.
Processes include:
⚫Talent Assessment
⚫Succession Readiness
⚫Development Planning
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Key Concepts
Two Distinct Components:
1. Key TALENT
2. Key POSITIONS
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ASSESSING TALENT
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What is “Talent”?Consider this: An employee known to be
High Performing
with High Engagement
and High Aspirations
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Talent Assessment Process
A process of IDENTIFYING TALENT in order to develop their skills and competencies in preparation of advancement into POSITIONS THAT ARE KEY to the success of the business strategy.
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Talent Assessment Process
•Necessary for Succession Management
•Can stand alone w/o Succession
•Calibrated with multiple inputs
•Can change over time
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Talent Assessment
Most Common Dimensions of Talent:
•Performance – Delivering on goals, results, and accountabilities
•Potential – the ability to adapt to and “fit” into increasingly complex roles and environments:
- Personal and Professional Motivation- Intellectual Curiosity- Innovation and Insight- Engagement- Determination
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Performance
• Most recent performance review ratings
• Feedback from others – 360 feedback
• Stretch goals and contributions
Questions to ask:•Does this person have a proven track record for accomplishing
impressive results?
•Are any potential inconsistencies “derailers”?
•Are they already performing at the next level?
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Potential
• It is multi-faceted
• Prioritize most important facets to evaluate•Values•Competencies
• It is ALWAYS a judgment call•Minimize subjectivity through comprehensive involvement•The more evidential experience, the better your judgment will be
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Source: American Bankers Association
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9 - Box Matrix - Example
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Source: McKinsey 9-box Grid
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Candy Lane
Peter Jensen
Andrea West
Julius Quo
Andrew Layman
Jane Austin
Pat Richardson
Sandy Sneed
Terry Non Lonnie Bates
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Example 1
Source: McKinsey 9-box Grid
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Candy Lane
Peter Jensen
Andrea West
Julius Quo
Andrew Layman
Jane Austin
Pat Richardson
Sandy Sneed
Terry Non
Lonnie Bates
Lindy Noodle
Jackson Normandy
Andy Coffman
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Example 2
Source: McKinsey 9-box Grid
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Talent Assessment Results
•Quantity and Quality of existing talent
•Relevant to all “people” processes:•Recruiting
•Development
•Rewards
•Performance Management
•Succession
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“AMI” Strategy
“ ” – Accelerate development; test potential
“M” – Motivate; continue to grow
“I” – Improve performance
Remember: All positions and all employees are important to the organization!
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SUCCESSION READINESS
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The RIGHT people . . . in the RIGHT seats . . . for the RIGHT time
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Succession Readiness
Identify for key positions:
1.Critical skills and competencies
2.Potential candidates for succession
3.Readiness level for succession
4.Developmental needs for skills or competencies
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What Are Key Positions?
• Critical to strategic goals
• Key leadership and functional expertise
• Defined by:◦Key Responsibilities – WHAT is to be accomplished
◦Competencies – HOW work gets done (knowledge, skills, and abilities)
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Identifying Key Positions
Goal Rationale
•Identify which jobs are mission critical
•Less than 15% of jobs
•Want Top talent in mission critical roles
•Strategy executed by key positions
•Don’t want “B/C” players in strategic roles
•Top talent impacts the bottom line
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SUCCESSION READINESS PLAN
KEY POSITION
KEY ACCOUNTABILITIES
COMPETENCIES
DATECOMPLETED
BY:
Candidate NameCurrent Position
Readiness Level
StrengthsDevelopment
NeedsInterimReady Now
2-3yrs 3-5 yrsLong Shot
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Succession Readiness
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Key Position Planning
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Executive
2-3 years
4-5 years
Long Shot
Interim
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Development Planning
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Development Planning
Development Plans
Clarifying the development gap between what possible successors can already do and what they must do to qualify for advancement
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Job assignments
On-the-job training
Off-the-job degree
programs
Development programs
Conferences and
professional association affiliations
Developing others
Reading
Project teams
Mentors
Developmental Activities
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Development Planning
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Development Planning
ORGANIZATIONAL DESIGN
ORGANIZATIONAL STRUCTURE
JOB DESIGN
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Org Design/Job Design
1. Need for innovation
2. Need for flexibility
3. Leverage available resources
4. Impact of technology
5. Learning and development
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Developing the A-Team
1. Know them
2. Tailor rewards / recognition
3. Develop retention strategies
4. Tell them!
5. Allocate appropriate development $$
6. Track retention
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SummarySuccession strategies for all levels
✓Ownership
✓ Board
✓ CEO
✓ Key Positions
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SummaryGet real about Talent Assessment!
✓Accelerate Top Talent
✓Motivate and Retain the Core
✓Improve portfolio
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SummaryAt the end of the day, it’s all about the “M”!
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IMPACTING PEOPLE LLC 55
Cheryl Thomas, SPHR, SHRM-SCP
Managing DirectorImpacting People, LLC
847.274.8783
Questions?