Who's Responsible for Succession Planning?

I like to tell the story about the executive director who, after ten years leading his social service agency, attended a conference on succession planning. Being inspired and with his agency having no such plan, he decided to broach that subject with his Board chair. Not that he had any plans to leave. In fact, things were going extremely well. But, from what he learned at the conference, he began to realize how vulnerable his organization was if for some reason he would not be there to lead it.

The next time he and his Board chair had their routine briefing, the executive director concluded the meeting by saying, “Just one additional item. I think we need to start talking about an executive director succession plan.” With a horrified look on her face, the chairman blurted out, “You’re not leaving, are you? Tell me it’s not so?” Having been assured he wasn’t leaving and hearing about the conference presentation, she still went home that evening and told her husband, “Our Executive Director is going to be leaving” (he actually didn’t leave for another four years).

The chair’s response was to be expected. In fact, if the roles were reversed, if the chair had attended the succession planning presentation, and she was the one who came back and suggested to the executive director that they start talking about a succession plan for his position, it might have been the executive director who went home that night and told his wife, “I think I’m going to lose my job”.

So how do you begin a conversation about leadership succession without raising suspicions or causing unintended angst? Whose responsibility is it?

Kittleman Alliance Partner and former CEO of national charitable organizations, Steve Delfin, suggests that succession planning is one of the most important issues facing nonprofit organizations. He notes that recent surveys suggest that between one-third and one-half of nonprofit executives planned to retire in the next two to three years. "Based on my experience with hundreds of nonprofit organizations, very few have a plan to address this very immediate talent crisis. There are sustainability and risk-management issues, and one that Boards need to address proactively, preferably as part of their on-going strategic planning process. That way it's baked into the cake as a joint responsibility of the Board and the CEO, and removes the awkwardness and possible misinterpreted signals that arise when one party of the other suddenly realizes there is no plan in place.

There is a divergence of professional opinion as to whether leadership succession planning is the purview of the governing board (they hire the CEO) or the chief executive officer (management succession is management’s job).

Consistent with Mr. Delfin's observations, and assuming a solid plan is not already in place, my own view is that it is the CEO’s job to broach the question with the board chair, but it is the board’s responsibility to engage with the CEO in coming up with a plan. That dialogue could start with a simple question to the board chair: “What happens if I get hit by a bus?” While a sudden, unplanned CEO departure is only one important reason to develop a succession plan, it is a good beginning dialogue. It is certainly more palatable than other scenarios that could arise, like “What happens if I take a job somewhere else and give you a 30-day notice?” That’s a pretty awkward conversation.

In fact, this hit-by-a-bus scenario is where many current leadership succession conversations start. Unfortunately, most plans end there as well. But once that particular scenario is on the table, other scenarios can be explored and added to the conversation. For example, what if the CEO has a serious health issue that prohibits her from carrying out her duties, maybe for as long as six months or more? Then what? Even in the case of a planned retirement where the CEO gives a one-year prior notice to the board, a written plan detailing the steps and activities of the leadership transition is imperative to make it work successfully.

It is incumbent on the CEO and board chair to spearhead an effort to design a unique plan. I say unique because every nonprofit leadership succession plan is an original and distinctive plan, relevant and applicable only to the particular organization for which it is written. And then it needs to be updated from time to time because changes in the organization will occur that will require new thinking.

Let me know what your experience has been. We would be happy to share our experiences with you.

Rick King
Chairman