Recently, Warren Buffett announced that he has prostate cancer. “The disease was detected early, and the 81-year-old Mr. Buffett is otherwise in excellent health. His prognosis is good.” This diagnosis brought up many questions regarding what will happen to Berkshire Hathaway after Warren Buffett. Warren Buffett has been at the helm since 1963.
In the Wall Street Journal article, And Buffett’s Successor Is…, Jason Zweig explained, “But the news brought renewed attention to the question of who ultimately will succeed him. […] He has said the members of Berkshire’s board have chosen a successor whom they know and admire, as well as two backups.”
He went on to explain, “Yet he hasn’t disclosed the successor’s identity—even to the chosen person. Nor would he reveal anything during my brief conversation with him this past week. Publicly naming his successor wouldn’t just make it hard for Berkshire to change its mind later if circumstances warrant; it would demoralize the two backup choices and make them more prone to poaching by competitors.”
Warren Buffett’s momentary health scare brought to light the importance of having a leadership succession plan. Do you have a succession plan for your organization? Do you know who will replace you or the other leaders within your organization once you are gone?
The Why Of Leadership Succession Planning
As leaders, it is very important to set up a leadership succession plan for your organization because it allows you to get the right people in place prior to unforeseen personnel changes. When people retire, quit, get promoted, or move to another position, a succession plan allows you to have someone ready to take their place. The leadership succession plan allows you to groom someone to step in when someone leaves by preparing them for the responsibilities of the future position.
What To Include In A Leadership Succession Plan
The succession plan can include all the leaders within your organization or just the top level leaders. You should determine the extent of your leadership succession plan based on your industry and business environment. Some industries are very specific requiring people with unique talents, while others that are more general allow for positions to be filled by people with a variety of backgrounds. You should determine it based on what works for your company.
The Benefits Of A Leadership Succession Plan
If you have a leadership succession plan, you will be much more prepared when changes come. The leadership succession plan will allow you to prepare someone to step in when someone leaves. When you are prepared, you will experience limited disruption within the organization due to the learning curve with new leaders.
Why is a leadership succession plan important to you? What benefits have you experienced because of a succession plan? Please share your thoughts in the comments section below.
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