Philadelphia – The biggest source of an organization's future leaders has become their own high-potential employees. Companies are more frequently developing their own fast-track employees into future senior managers than they are promoting their current executives into upper management or recruiting leaders from outside their organizations, according to a survey by Right Management Consultants.
Almost eight out of 10 (77 percent) companies said they do not have enough successors to their current senior-level managers already working in their organizations – raising a pressing need to develop or acquire their next generation of leaders.
Forty-three percent of companies are providing the necessary developmental training and coaching to their high-potential employees so they can acquire the requisite skills to become senior-level managers, according to the Right Management survey of human resources managers at 168 companies nationwide. Thirty-nine percent of companies are promoting their now-ready executives to higher management.
Fewer companies are hiring senior-level executives from outside their organizations. Only twenty-nine percent are hiring executives currently at the same level as those they need away from their competitors, 27 percent are hiring executives with the skills and experiences they want from businesses other than their competitors, and 20 percent are hiring upper management from completely outside their industries.
“More companies prefer to build their own future leaders from the ground up,” said Debbie Schroeder-Saulnier, Managing Principal and Lead Organizational Consultant for Right Management Consultants. “They are assessing their high-potential employees to identify which ones have the qualities they desire in senior-level managers, and then providing them with the necessary training, coaching, and managerial experiences to fully grow them into upper management.”
One of the biggest management succession problems facing companies is the dwindling pool of currently-ready managers that can be promoted into upper management. “As the Baby Boomers prepare to retire in great numbers, there are fewer of them to promote to the next level, as well as fewer to recruit from outside their organizations,” said Schroeder-Saulnier.
Also, more organizations are choosing to develop their own employees, rather than recruit from the outside, because current managers are more familiar with, and have acquired a greater understanding of, the organization's culture. “Among the major reasons why executives recruited from the outside fail in their new jobs is their lack of familiarity and compatibility or ‘fit' with the company's culture,” said Schroeder-Saulnier.