BCA

By John Riley

Recently, I was invited to lunch at a Business Clubs America luncheon where the speakers were owners of a successful jet-management company. It was the usual business luncheon where invited speakers recount their experiences in building successful enterprises. But it didn’t turn out that way.

When the CEO rose to speak, I quickly noted he was a well-built, robust looking 45-year old whose commanding presence told you he was an executive. Instead, Scott Bolzan was a man whose life literally began a little over a year ago because his former life was completely erased from his memory. On that fateful day in December 2008, he walked into the bathroom of his office, slipped and fell striking his head. With that fall went his knowledge of his former life.

When he awoke in the hospital, there was no memory of his school days, his college education, his pro football career or his wife, Joan and daughter or the business he built. Doctors diagnosed his problem as profound retrograde amnesia and historical and autobiographical amnesia.

Doctors expected his memory to return so he was released three days later. The thinking was that being in familiar surroundings would help him recover faster. His short term memory was fine. Now, nearly a year and half later, the only memory he has is what he has learned from his wife and friends. Joan told herself the business was dormant, but Scott would be back.

With a succession plan, the business could have continued to prosper

No one could have foreseen what happened to Scott. So his business suffered. Had there been a succession plan, the business may have continued to prosper. Too many companies fail to devote time to designating potential successors for their key executives and consider it a risk worth taking.

Owners and CEO’s themselves can be a big part of the reason because:
1) They feel indestructible
2) They don’t want to be replaced prematurely by a potential successor
3) They don’t want to share power
4) They feel there isn’t anyone that can replace them
5) They want to wait until they decide to retire and then worry about a successor based on the circumstances at the time.

Establishing a succession plan is usually a Board imposed process. Larger companies usually have succession plans that will go down several layers in the management structure where they identify three or four candidates to replace the incumbent for each position. It’s a dynamic process and the plan is reviewed and updated each year.

A combination of top operating executives and an HR executive constitute the personnel selection committee.

Personal development is a key component of the planning

One of the outputs of the committee is a personnel development component. Fast trackers are identified and gaps in their training or experience are identified. Subsequent assignments are decided upon to give those individuals the training or experience they need to prepare them for greater responsibilities. Each assignment is a test whose outcome will help determine the individuals’ future career path.

Scott’s experience is not unique in corporate America. Anyone who follows business can recall some top executive whose health unexpectedly intervened to temporarily or permanently remove him or her from active duty; Steve Jobs at Apple is a well known example.

For the health of the company, succession planning is an essential diagnostic tool.