National Academies Press: OpenBook

Developing Transportation Agency Leaders (2005)

Chapter: Chapter Six - Succession Management

« Previous: Chapter Five - Leadership Training: Program Attributes
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Suggested Citation:"Chapter Six - Succession Management." National Academies of Sciences, Engineering, and Medicine. 2005. Developing Transportation Agency Leaders. Washington, DC: The National Academies Press. doi: 10.17226/23300.
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Suggested Citation:"Chapter Six - Succession Management." National Academies of Sciences, Engineering, and Medicine. 2005. Developing Transportation Agency Leaders. Washington, DC: The National Academies Press. doi: 10.17226/23300.
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Suggested Citation:"Chapter Six - Succession Management." National Academies of Sciences, Engineering, and Medicine. 2005. Developing Transportation Agency Leaders. Washington, DC: The National Academies Press. doi: 10.17226/23300.
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Page 26

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24 Succession management has a variety of definitions and is subject to interpretation, just as are many of the other con- cepts in this study. For the purposes of this report, succession management is defined as a deliberate effort engaged by the organization’s leadership to recruit, train, develop, and pro- mote individuals to successively responsible leadership posi- tions to the benefit of the organization. Although other defi- nitions might be offered, this one captures the essence of the purpose of this synthesis. Succession management applies to all levels of leader- ship. Failure on the part of leaders to prepare their subordi- nates for promotional opportunities is unacceptable in today’s environment. Succession management may be found in dif- ferent forms or be more formal depending on the level of the leader involved, but the purpose remains the same: Preparing leaders to assume greater responsibilities within an agency or organization. A discussion on succession management must first focus on the two types of positions found in a typical state DOT. The first class of employee is the “merit” class, which is defined as a typical civil service role where all personnel rules and protections apply. Personnel rules typically define in great detail what an agency can and cannot do in terms of promotions, training opportunities, and so forth. In some states where unions exist, there can be even more restrictions about what agencies are allowed to do in cases of seniority, longevity, and even testing. The second class of employee is the “non-merit” class, which includes those not protected fully by personnel rules. These individuals serve at the pleasure of some appointing official, such as the DOT CEO, the governor, or some other official. These positions are filled without regard to the state’s personnel rules, allowing the appointing official wide latitude in who is appointed. Correspondingly, individuals can be ter- minated without cause. A positive aspect of non-merit posi- tions is that a state CEO has the freedom to move these indi- viduals into roles and responsibilities that would not be possible otherwise. For an agency with both types of employ- ees, succession management must be tailored to deal with both. Succession management describes a variety of programs found in state DOTs and private-sector organizations. They range in nature from informal or loosely organized efforts to highly sophisticated and detailed approaches. Some focus on key leadership positions, whereas others work on a wider selection of mid- to upper-management roles. Some private- sector companies have extensive procedures in place to facil- itate replacing a CEO or other key position should that person be incapacitated, pass away, or unexpectedly leave the com- pany. Other companies and organizations limit the number of board members or senior leaders who can travel together. Still others have formal committees that act immediately to estab- lish new leadership when vacancies occur. All these situations fall under the definition of succession management. The state DOTs were surveyed to determine the nature of their succession management programs. Of interest were whether or not such programs existed, whether they were for- mal or informal, and how the programs influence replacement practices. Responses from the states offer important insights into how transportation agencies are approaching this impor- tant area of human resource management. STATE PROGRAM STATUS The survey queried the states to determine if they had a suc- cession management program in place and, if so, whether it was formal or informal. Although the existence of succession management programs is not unusual in large-size private- sector organizations, there is a striking absence of such pro- grams in public transportation. Of the 25 states responding to the survey, only three (12%), Iowa, Nebraska, and Tennessee, have formal programs. Ten states (40%) indicated that they have informal programs. Tennessee and Nebraska actually have both. In total, 13 states—just more than half—have no succession policy. A question was asked to ascertain why states do not have a succession management program. Responses varied, but included the following: • Never had one before • Personnel rules do not allow it • Things are working well as they are • Lack of time and resources—including funding • Concerns with preselection issues • Lack of executive endorsement. Funding can be an issue in any program of this type because legislatures are often reluctant to provide money for CHAPTER SIX SUCCESSION MANAGEMENT

25 what they see as “soft” programs with little immediate ben- efit to their constituents. However, states seem to be moving forward, in spite of monetary shortfalls, by crafting career development programs that require little or no funding. Some general concerns exist about personnel rules. For example, some believe that such a program will result in pre- selection issues and accusations of favoritism. Nearly all states operate within the bounds of a civil service system and must follow its rules as they plan either a formal or an informal program. It is clear that states with enough interest have found ways to create and maintain programs in spite of per- sonnel rules. The responses to the question of why a program does not exist were not uniform and no clear pattern emerged from them. EXISTING SUCCESSION MANAGEMENT PROGRAMS One of the first considerations for implementing a leader- ship program is determining who will be responsible for it. Although experience shows that it is not essential for the CEO or another senior leader to be responsible for such a program, there is often a connection between stated CEO priorities and how much importance is attached to an initiative. In assessing existing succession programs in surveyed states it was found that such programs are led by one of the following: • Executive director, secretary, commissioner, 17%. • Deputy director, assistant secretary, assistant commis- sioner, 17%. • Director/chief of administrative services, 13%. • Human resources director, 21%. • Training director, 13%. • Other, 0%. • No response, 19%. These results clearly show a high level of interest by top agency leadership in these training programs. Apparently, they are not usually relegated to mid-level managers or other officials who may have little ability to substantially influence programs and outcomes. The survey itemized seven possible attributes of a succes- sion management program. This was done to identify a base set of characteristics and any possible trends that might serve as a template for a state’s desire to improve or implement its own succession management program. The options are pre- sented here, with frequency of response in descending order: • Specific actions are taken to address the development requirements for specific individuals, 38%. • Individuals in the program have had an inventory of their skills and abilities prepared and key areas of further development requirements have been identified, 33%. • Individual appointments to positions are done with development requirements in mind, 29%. • Human resources director or someone other than the executive director, commissioner, or secretary is respon- sible for the program, 21%. • Individuals are formally identified and know they are in the program, 17%. • Mentoring relationships are established and active, 17%. • The executive director, commissioner, or secretary is responsible for the program, 17%. The three most common attributes of state DOT succes- sion management programs focus on individuals; assessment of skill and training requirements and appointments to posi- tions are done with specific skill development outcomes in mind. Such a focus on individuals with unique needs seems to be a powerful thread among the states as they seek to advance their leadership corps. Other responses provided to this question further illustrate the attributes of effective programs. For example, in Ten- nessee, funds are available to assist in implementing its pro- gram, while additional personnel manage the effort. Virginia uses a 360-degree developmental tool that focuses on cur- rent and desired skill sets, as opposed to the other 360 tools described earlier, which are used for appraisal purposes. One outcome of this study was that in only 17% of the pro- grams were individuals formally identified and notified of their participation. States might be engaged in formal or infor- mal succession management efforts without the participants actually knowing they are included. This may be a way states are able to have a program that does not conflict with accusa- tions of preselection of candidates for positions. One obser- vation about individuals unaware of their participation is that active knowledge would enhance a person’s contribution and progress in achieving the desired advancement skill sets. Oth- erwise, potential leaders are moving forward without know- ing about management efforts to help and train them. Each state was asked to assess the effectiveness of its suc- cession management program. The choices ranged from “Excellent” to “Very Poor.” Although definitely subjective, the responses still present a glimpse into how well a program is functioning according to those who work with it. Of the states with a succession management program, only Califor- nia ranked its program as being “Excellent.” Five states ranked their efforts as “Good”: Iowa, Nebraska, Ohio, Tennessee, and Utah; four ranked their programs as “Fair”; and one state rated its program as “Poor.” A review of each state’s assessments, along with the attrib- utes previously reported, offer interesting insight into state efforts. For example, almost all the states that rated their pro- gram as being either “Excellent” or “Good” had at least two of the three attributes cited here: • Specific actions are taken to address development requirements for specific individuals.

26 • Individuals in the program have prepared an inventory of their skills and abilities, with key areas of further development requirements identified. • Individual appointments to positions are done with development requirements in mind. However, those with only “Fair” ratings also reported having at least two of these same attributes. Thus, the success or effectiveness of the state DOT succession management pro- grams cannot be predicted based on the use of specific attri- butes or on the strategies rated earlier. As part of the survey, the states were asked to identify what they would change about their programs if given the opportunity to do so. The responses varied, but also showed a common desire to formalize and expand the programs. Responses, without state identification, are as follows: • We must formalize our program and provide training to all levels. • Formalize the system to a greater extent, using trait- based and competency-based assessments. Structure mentoring relationships and/or formalized job rotation to give participant more experience in key areas impor- tant for our leadership. • We are developing a pilot for a formalized executive workforce development process that will directly affect succession planning. • Overhaul the entire program. • Expand the program. • Plans are underway to formalize into a structured pro- gram. • Develop a more formalized program that incorporates the tracking of training and build in a mentoring program leading to advancement of leadership capabilities and potential consideration of future senior-level positions. • Formalizing the program would be a good first step. Sometimes a state turns to the private sector for successful program models to follow. These private-sector firms can be either within the transportation industry or from totally dif- ferent fields. Five of the 18 states responding to this ques- tion indicated that they had gone to the private sector to find best practices or models to follow. Organizations mentioned included Intel, Delta Airlines, BellSouth University, Virginia Commonwealth University, and Management Development, Inc. This represents a cross section of private- and public- sector firms with different business activities and interests. Leadership development and succession management activi- ties cross industry boundaries and cultures without regard for type of business or product, so consideration of this resource is certainly valid. The states offered many other insights into current pro- grams and what they would do in the future to become more effective in advancing future leaders. A full set of their responses is found in Appendix C, with a summary provided here. Arizona offers a significant vote of confidence in the potential of individuals to step up and assume leadership positions, even to those who have less experience than their predecessors had when they were appointed. Missouri’s responses suggest that long-time requirements for profes- sional certification in certain positions sometimes prevent the appointment of an individual even though the particular job does not require the performance of the technical functions related to that specific certification. Suggestions were made for more formal mentoring or “shadow” programs that allow mid-level leaders to learn first hand from senior leaders. Succession management is not a simple process; it requires discipline and tenacity, along with leadership and commit- ment. Different succession management programs have the common component of focusing on individuals and their spe- cific needs, but this does not seem to be a discriminator for effectiveness. No clear trend emerges that makes one pro- gram superior to another based on the presence of certain practices. Perhaps the most telling point of this chapter is that these programs need to be led at a high level and focus on individuals and their needs. Effectiveness is not affected by formality or informality, as the six states with “Excellent” or “Good” evaluations included three from each category. How- ever, although all the states with formal programs had “Excel- lent” or “Good” ratings, not all of the informal programs were rated as highly. Therefore, the existence of a formal program is probably one of the best ways for an agency to be effective in this area. However, even informal programs can provide value, and states with informal programs did not indicate that they would like to change them.

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TRB’s National Cooperative Highway Research Program (NCHRP) Synthesis 349: Developing Transportation Agency Leaders examines practices and innovative approaches that address the development of transportation leadership in today’s work environment. The report covers demographics, recruitment and retention, leadership training, and succession management.

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