The wind was at our back. Our tech company, Brush, was hitting its stride with our third year of back-to-back 35% growth. Yes, we were on a roll — yet the facts spoke for themselves.

We just committed to purchase a $13.5 million vanilla SAP program. We had sent our letter of intent to purchase our number three competitor. With this strategic move, we opened our international offices in Latin and South America.

And then, at our last board meeting before everything was finalized, our CEO, Kurt Olsen, had something to say:

“I am sick.”

We knew what it was: cancer. It was sobering for all of us. From an outside perspective, we had our CEO succession plans in place: Andrew Nolan, our chief operating officer (COO) and always the smartest man in the room, was to succeed Kurt. But internally, there was a dawning realization of just how unprepared we were for what we were now facing. Only to Andrew did we entrust ownership of the ERP project (after two failed attempts with outside integration firms), the M&A project that was just kicking off and his expanding COO job duties. The board was stunned to hear Kurt would need to resign. The enormity of it was hard to comprehend.

The board made the decision to appoint Andrew to the vacant CEO position.

We were facing a problem we needed to grow up around. We needed a systematic and effective way to manage talent as a corporate asset. The problem was not just the succession question — which is complicated enough on its own — but the combined backfill and succession issuesthat had pushed us up against a wall.

It was a problem landing in the lap of the executive VP of HR… who was me. Our CEO gave us 40 days in the office – tops — and then he was out.

Together as an HR executive leadership team, we brainstormed our strategy and game plan to change the landscape in terms of our talent, from hunting for key personnel to developing our own.

Succession Challenges

We did extensive planning before Andrew’s first day as CEO. We had a plan for his first 100 hours, what needed to get done. These were confidential select emails to his direct reports, employees, the board, and key investors and customers. We tracked out his goals with him for the first 100 days, developed his strategy and brushstrokes on his first year in the office, named his successors — in short, we developed the entire company’s strategy, its emerging leadership, and the company’s next steps regarding expanding markets and the need for new services.

Talent Challenges

It was obvious our need for game-ready leaders was one of the company’s top five priorities. Yet talent was never one of our top five objectives until now. We were seriously stretched for talent. I had a quote on my desk that turned me in the right direction:

“If you want 10% growth, you need 10% game-ready leaders.”

Jack Welch, CEO of General Electric

We had been humbled by our unpreparedness in our current situation. In the past, we always found the next-best leader (internally or externally), but had no systematic approach to develop game-ready leadership. We weren’t going to get lucky — not this time.

Enter the three main tenets of our new talent HR strategy.

• We developed a leadership profile — a simple, home-grown, one-page list of key attributes a leader would need in our company.
• We reviewed and modified job descriptions of everyone at the director level and above (over 300 people), including leadership profile elements in the job descriptions, and developed a dynamic and impactful three-day leadership development program.
• We required each director to identify the top three candidates under their wing to become their successor. Also, we mandated a bullet point development plan for each of these candidates and a twice-yearly submission to update to HR of the candidates’ development over the past six months.

These foundational pieces were helpful — but not enough. We ensured that talent management would be addressed as a board issue twice per year … in perpetuity.

Now, we scan the top 300 people and stack-rank our emerging high potential leaders. We incentivized those leaders who graduated, mentored and promoted their own candidates under their leadership. We noticed the leader of the West Coast, Canada and Southwest branches all grew under a particular general manager who was the major exporter and developer of talent.

Our leadership development program convened three times a year, with 25 people per class. The program was three days of intensive work, as well as ongoing work throughout the year solving real

problems and working with external experts to learn how to become better leaders. Global teams formed five smaller teams of five high-potential leaders.

Each team of five met briefly with the board and was assigned a series of previously identified tough, complex business problems that the company needed to resolve or its growth would be impeded. This was a nine-month project. Once completed, this team would report to the board its recommendation, and, if approved, the recommendation was implemented quickly.

Onboarding

What is humbling is that, even if you complete the prescribed steps outlined above, it doesn’t necessarily solve the problem at hand. Results in this domain of succession are tricky. We researched successful and failed succession projects. We saw many examples of new CEOS performing worse than their predecessors, all of which matched trends from data collected nationally by the National Association of Corporate Directors.

We studied four national powerhouse companies whose founders did these types of talent management activities, and the hand-selected CEO successors of all four of these companies lasted less than 14 months. Salesforce, Dell Computer, Charles Schwab and Bridgewater all had hand-selected CEO candidates and all of them failed. From our point of view, the secret lay with the onboarding process of the new CEO. So, we quickly put together the two people who knew the most: our CEO and COO worked out of the same office and co-managed the role of the CEO for over 30 days until Mitch left.

Andrew then led the company as CEO for over 12 years.

The issues of succession and talent management are both art and science. The programmatic elements of experience, job descriptions, education, span of control and much more need to be tempered with the unique cultural elements to increase the likelihood of success. The succession plan for the leadership of a company is an ongoing board issue and needs attention, time, discussion and examination. We instituted a twice-yearly feedback session for the board, both written and during discussion, for all board members to give and receive feedback on what was and was not working between our C-suite leadership, talent management and the board as a whole.

The question of “Who will lead us next?” is one of the thorniest issues a board will ever face. If you find yourself asking, “Where will we find the time?” just know that effective planning creates time.