With the looming retirement of the baby boomer generation and the global competition for talent, CEOs are making succession planning a top priority. In order to remain competitive in today’s increasingly global marketplace, organizations need to effectively develop and deploy their talent. CEOs are therefore more aware not only of the costs and benefits of developing top leadership but also of the risks of not having the required skills to deliver on business objectives and the impact on the bottom line.
Progressive CEOs understand the need to establish business processes and define strategies with HR to better manage the supply and demand of talent throughout the organization. Effective management of talent leads to enhanced productivity and faster revenue growth while a poorly managed workforce and talent strategy can negatively impact organization performance:
Lost business opportunities due to position vacancies and time required to bring new hires up to the same level of productivity;
Recruitment costs incurred searching for and hiring replacements when succession strategies are not defined;
Improper alignment of succession planning and business goals can lead to high turnover, corporate instability and poor performance.
Research shows that an organization’s success is directly linked to the talent it can access and utilize effectively. CEOs are therefore looking to strategic talent and succession management initiatives to align human capital with business strategies to support organizational and financial goals. The need to match talent to business needs is therefore being recognized as a critical component of a successful business strategy. Organizations’ capacity to drive performance hinges on their ability to have the right talent in place— at the right time.