Most agree that developing a robust leadership pipeline is key to driving your company's strategy. But should you build or buy your leadership talent?
BUILD (developing within)
There are clearly many advantages to internal promotion. It ensures a deep, thorough understanding of your organization, allowing your business intelligence to be passed along to the next leader. It enables companies to build the skill sets and leadership styles that meet their precise needs. It also helps with attraction & retention by demonstrating that the organization is committed to growing its leaders.
BUY (hiring outside)
However, there are situations where organizations have to rely on external hires, for example in case of start-ups, emerging industries, or if the organization is experiencing rapid growth. There are also some unique benefits to sourcing candidates outside your business. You never want to select all your candidates from internal pools as that cuts you off from fresh perspectives and new thinking.
So what is the right mix of Build vs. Buy?
Korn Ferry found that the ideal mix is 67% Build - 33% Buy.
An effective succession management plan is critical for any organization. It's a way of ensuring you have the right talent in the right place to activate, drive, and execute your business strategy. As you evaluate your organization's current state of succession management, consider the following:
What leadership talent do you need?
Organizations need to align their talent and business strategies so they can accurately pinpoint those key skill requirements.
What leadership talent do you have?
Awareness of the talent gaps will enable organizations to assess and identify their current and future capabilities.
How do you close the gap?
Execute your talent management strategy and start to fill key leadership roles.
At the end of the day, what really matters is not the succession process itself; it's ensuring that succession produces the leaders you need to take the business where you want it to go.
Source: Succession Matters. Korn Ferry