By Grace Lau, Managing Consultant, atrain Limited
So you are in a fast-growing market. Perhaps it is China, or Vietnam, or Indonesia, maybe Russia. Your situation probably looks a bit like this: market is growing, and of course the Board envisions the market share to grow at least at the same rate. You are expecting double-digit growth in business. Everything is looking good. Except that you will need to fill 20 top-level critical positions in the coming five years, and you only have a handful of HiPo employees who are ready in the short- to mid-term. In fact, you have a feeling that some of the mid-level or even top-level leadership positions are currently being filled by people who are perhaps not yet ready. It is no doubt that the occupants of these positions have very strong track records, though there may just be a little gap to close before they can become strategic and inspirational leaders. In a nutshell, you need to strengthen the succession pipeline.
Tip 1: Robust HiPo selection
The first step to strengthening succession pipeline is to have a systematic way to select people into the pipeline. It sounds like common sense but, unfortunately, it is neither that common nor easy to do because managers in different business functions and units tend to have different definitions of ‘high potential’. While evaluating past performance is relatively straightforward, evaluating potential is trickier. Having a well-defined leadership competency model would help as it allows managers to compare their HiPo employees with a common language. Some companies also use tools such as interviews, psychometric tests and assessment centres to measure potential more objectively.
We worked with a client who had done all of the above but the HiPo selection was still not satisfactory. We discussed and discovered that the most critical element—candid and well-informed talent review discussion—was missing. We had to change the way talent reviews were facilitated, so that 1) the managers understood and bought into the evaluation criteria, and 2) each nominated employee was systematically and critically evaluated. It takes more than a detailed and standardised process—your stakeholder management skills and courage are what really count.
Tip 2: Feeder positions in plateaued markets
Once you’ve got a pool of HiPos, it is time to accelerate their development so that they can fill critical positions in a timely manner. Companies are highly creative in this aspect and deploy a wide variety of talent development tools and methods. But there is an obstacle particularly prominent in fast-growing markets: HiPos are so busy in their current role that there is no time for development. It is too risky to promote the unready HiPos, but it is also too much of a luxury to give them stretch assignments that get them out of their comfort zone. So, many companies end up just sending HiPos to training or, at most, giving them a special project.
We had a client, who used to have a more decentralised HR approach, realised this was a problem and then decided to strategise talent development regionally. That resulted in the creation of feeder positions in slower-growing markets, which in turn offered profound development opportunities for HiPos.
Feeder positions are stretch positions to be filled by HiPos, so that they gain the necessary competencies before they are considered for a similar role in more critical markets. Some of the most successful HiPo development cases we have seen came from putting HiPos into bigger roles in relatively stable markets. The organisation’s benefits are three-fold. First, HiPos’ development will be accelerated and thus strengthen the succession pipeline. Second, the risk of putting HiPos into feeder positions is much smaller than directly promoting them to key positions in fast-growing markets. Third, it helps to retain HiPos as they can easily go to a competitor, and will do so if they do not get a bigger role.
Tip 3: Awareness-based development
In many cases, companies are willing to take the leap of faith to hire or promote someone who may not yet be really ready. Sometimes that does not even seem like an option to choose but rather a reality to accept, especially in fast-growing markets where talents are rare and rapid business expansion essentially pushes people up the organisational ladder. That means many people are walking in shoes that are bigger than their feet. This gap is an inconvenient truth in fast-growing markets. Business figures look good and so it seems unnecessary to many managers to make a fuss about gaps in leadership competencies. Initiatives that build self-awareness would be particularly helpful in this situation.
As a psychologist, I cannot emphasise enough that self-awareness is one of the strongest predictors of success. This is a particularly relevant point when we work with HR professionals in fast-growing markets. HiPos, who are used to performing very well (partly because the market is growing so fast), find it very helpful to participate in development programmes in which they receive candid feedback in a safe environment, and are coached to reflect on their contributions and flaws as a leader. One of our clients added awareness-based elements, such as self-reflection and feedback, even in the selection and on-boarding process. As an HR friend once said, “There appears to be no perfect-fit candidate in the whole country. So I’ll settle with an imperfect one who is aware of his/her imperfection.”
Tip 4: Leverage on expatiates flexibly
You may find yourself in a situation where you need to fill a critical position in a very short time. You thoroughly assessed ten candidates and only two of them have the right kind of experience, competencies and values. Yet, neither of them speak the local language, which the business unit leaders have said is a ‘must-have’ criterion because up to 30% of the staff does not speak fluent English. What would you do? Would you lower your standard so as to hire someone who speaks the local language? Or would you revisit the priority of this criterion and if necessary challenge your colleagues’ assumption? Localness is undoubtedly a very helpful thing to have. To a certain extent, a foreigner—even a culturally sensitive one—can never truly replace someone who knows the local language and culture. However, in markets where local talents are very rare, it may be more realistic to leverage on expatiates to temporarily patch the succession pipeline and to act as a catalyst to strengthen the local pipeline. For instance, we have seen companies in which expatiates are specifically tasked to cultivate local successors within a specified time frame. In some cases, local peers are also assigned to coach the expatriates. A client once put it nicely, “Having a good mix of locals and expatriates reminds me that this is not a local company, but an international company operating locally.”
Paul Arkwright
Publisher
