Succession Planning is a comprehensive and ongoing best practice that safeguards an organization’s health, while ensuring sustainability and the resilience needed to weather any unforeseen events or transitions. At its heart is a culture that prizes continual leadership development among the board and staff.
The term “succession planning” is most often used to describe a process that addresses the loss and replacement of an organization’s chief executive officer (CEO). However, there are multiple aspects to succession planning that include:
Emergency Succession Plan
A detailed inventory of all crucial information needed to keep things running smoothly during an unexpected loss of leadership. This includes the location of important documents, passwords, financial data, program files, HR records, contracts, contact information for key partners and vendors, etc. It identifies who will “step up” or “step in” if there is an unplanned loss in leadership and what parameters will be in place to guide interim leadership. This document contains sensitive data and access to it may be limited to the board Chair, board Secretary, and senior staff such as the CEO and the COO, CFO or deputy CEO. It is updated periodically.
Planned Executive Transition Plan
This can be short-term medical or family leave (up to 6 months), or longer-term extended medical leave or sabbatical (up to 12 months), or permanent leave based on resignation or retirement of the CEO. Plans for short-term or longer-term leave when the CEO is expected to return can be incorporated into the Emergency Succession Plan. A plan for how the board will identify, recruit, onboard and support a new CEO can be discussed by the full board at any time during a current CEO’s tenure as part of a board’s ongoing governance education program.
Leadership Succession Plan / Staff
Identifying and developing potential leaders within an organization builds bench strength for key positions, allows an organization to hire from within and provides for seamless transitions when vacancies occur. Offering professional development to staff creates a culture where employees feel respected and valued which contributes to staff retention and can be a draw when attracting new talent. While staff development is a purely management function, the board supports the effort by ensuring that the annual budget includes a line item for staff professional development.
Leadership Succession Plan / Board
Building a pipeline for leadership positions is a critical aspect of succession planning at the board level and key to developing a dynamic, diverse, and highly effective board of directors. This process includes strategic recruitment of new board members and a robust committee structure that uses committee leadership positions to cultivate future board officers. Term limits can ensure that the board is continually engaged in a strategic process of identification, cultivation, recruitment, deployment and support of new members. Board-level leadership development is, ideally, supported by and aligned with a board-approved strategic plan.
Succession Planning as a Best Practice
Leaders in the field of nonprofit governance and leadership development all agree that succession planning is a core responsibility for a board of directors. You can learn more about succession planning from Council on Foundations, BoardSource™ and Annie E. Casey Foundation.