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Blog/March 6, 2020

5 Ways to Ensure Succession Transitions

A preparation process that can take years to fully develop and implement, succession planning has become a hot topic in today’s labor-constrained work environment. Not only are new, qualified workers getting harder and harder to come by, but also some of the most talented veterans are exiting the labor force and heading off into retirement.

This double-edge sword creates significant challenges for engineering and construction (E&C) firms that haven’t prepared and groomed the next generation of leadership to take over the reins.

Why Good Succession Matters

If your organization hasn’t looked at succession planning lately, it isn’t alone. Citing data from APQC, CFO magazine says that just 8% of companies have such plans in place for their operational and office staff. The number jumps to 75% for middle management and to 94% for management and executives—statistics that correlate directly with overall organizational performance1.

“Top performers on this metric were still more likely to use succession planning across all levels of an organization than median and bottom performers,” CFO points out, “helping ensure that an unplanned exodus of key talent does not bring work to a standstill.”

Good succession planning also helps companies develop and keep talented employees; increase engagement with those workers; diversify the potential leader pool; and be prepared for unplanned circumstances (e.g., the unexpected loss of a leader or manager).

Ignoring the Need for Succession

According to Gartner, just 27% of businesses today have the leaders in the pipeline that they need for the future. This is a major oversight in today’s business environment, where baby boomers are exiting the workforce in droves, and the national unemployment rate is hovering at 3.5 percent.

“Most HR leaders approach succession planning by managing a pipeline of successors who have the potential to fill a specific position or type of role,” Gartner points out. “However, almost two-thirds of HR leaders expect a significant portion of leadership roles to change within the next five years, and one-third of those leaders can’t predict how the roles will change.”

By identifying high-potential team members, developing those individuals to take on their “next roles,” opening dialogue with those employees early in the succession process, and building a consistent culture of leadership, E&C firms can reverse this tide and start realizing the benefits of good succession planning. Here are five good starting points that all companies can start using today:

  1. Reconnect with long-term goals. While many leaders may have a general sense of their own vision and business strategy, these central areas aren’t always clearly established, communicated and embraced by all senior leaders. Leaders in E&C can avoid this problem by exploring the strengths and weaknesses of the organization; creating alignment around the future direction of the company in the near and distant future; and identifying the core values that govern behavior and make up the organization’s unique culture.
  2. Focus on the people. A vital aspect of succession planning, a firm’s internal pipeline of talent can be a gold mine. Unfortunately, not everyone sees it that way. “In any succession planning process, I think people want to go to the numbers first,” said one E&C CEO. “They want to talk about the money. That’s not what’s important. I mean, that’s important; but what makes the money work is the people. It is all about people, people, people.” In other words, a strong pipeline of talent is a critical component of succession planning because it guarantees that companies have internal candidates prepared to move into more senior roles.
  3. Don’t just zero in on one good candidate. Organizations get into trouble by identifying just one potential replacement for a specific role. This creates unnecessary risk. If, for example, that replacement decides to leave for greener pastures, the company will be back to square one in the succession planning process. The other common pipeline challenge is not having identified replacements for every position. This can result in a potential replacement becoming “stuck” if no one else is able to backfill his or her current role (thus preventing that person from moving into the next leadership position).
  4. Knit succession into your corporate culture. Self-sustaining talent pipelines are rooted in organizational cultures that prioritize learning and development. These organizations intentionally seek out opportunities to grow their people; provide extensive formal and informal development opportunities; and provide positive and constructive feedback to employees. These elements promote retention and longevity in the business by allowing team members to “see” the career advancement opportunities that lie before them.
  5. Use tailored training to address skill gaps. Not every future manager or leader is going to bring all of the necessary skills and experience to the table. This reality presents significant opportunity for E&C firms that put the time and energy into tailored training and development programs designed to address skills gaps. Internal development programs (e.g., in-person training, mentoring programs, on-the-job training), external development training programs (e.g., leadership institutes, project manager academies), and formal education (e.g., MBA courses, other degree programs, industry certifications) can all help get high-potential successors up to speed and ready to take over.
It’s Time to Make Your Move

It’s easy to underestimate how long the succession planning process will take. That’s because the best executive transitions incorporate extensive planning and preparation; they leverage multiple perspectives; and they’re based in objective processes. These things also take about seven years, on average, according to FMI’s research. Whether your next top executive will be leaving in one year or 10, the time to start building the foundations for succession success is now.



1 Perry D. Wiggins. “Metric of the Month: Formal Succession Planning Lacking.” CFO Magazine. May 1, 2019.

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