Your top performer has resigned. Now what?

It’s Thursday afternoon. Your employee asked you for a personal meeting. You’re thinking it will be a quick update meeting. Not quite. Your star performer is handing in their notice.

This is not how most of us want to end their week. Receiving the resignation from your top performer can leave you feeling frustrated. So many thoughts are running through your mind. Just what are you going to do now?

Accept and learn

Take a deep breath. It may feel like the end of the world. It isn’t.

You may experience the feeling of hurt and disappointment. After working closely with your top performer, you’ve trained and developed them and don’t understand why they didn’t open up earlier about their plans. The employee may have had their reasons for not sharing them with you. Or perhaps they did all along and you just didn’t listen?

For now, simply accept their decision and take some time to reflect on it.

(No) counter offers

You may not be that ready to accept their resignation. You may consider offering them a counter offer, generally involving a higher salary and/or exposure to specific work and responsibilities.

Some companies categorically rule out counter offers. Such organisations see counter-offers only as temporary band aids. After all, you shouldn’t stop a rolling stone.

Unfortunately, history has shown that most employees who accepted a counter offer will still leave for the same reasons that made them look externally in the first place. Next time around, the company will not offer another counter offer and the employee will leave for good.

In contrast, some organisations may provide a counter offer for top performers in critical roles or working on time-sensitive projects. For these companies, a counter offer closes the immediate need and buys them more time to find an alternative, knowing the employee may still resign in a few weeks or months.

Before committing to any counter offer with your star performer, check with your company’s process and DOA. How long will it take to reach a decision, including answering these questions:

  • Do you know what would make your employee stay (higher salary, flexible schedule, a different project)?
  • Will you be able to match the external offer? Do you want to match the external offer?
  • If not, what non-financial offerings (e.g. new customer, new responsibilities) can you provide? How will you sell these?

Learn from exit interviews

“Employee leave for more money” used to the be explanation. Study over study shows that compensation is not one of the top reasons. For many top performers, a number of events is leading to their resignation.

Organise an exit interview and understand the employee’s motivation for leaving. Exit interviews are ideally held on the employee’s last working day or after they’ve left the company. This way, they don’t have to fear any repercussion for providing direct and honest feedback.

For any exit interviews held by HR in person, careful attention has to be paid to non-verbal cues. Assumptions and interpreting what the employee may wish to say can be misleading. More and more companies therefore use online exit interviews which protect the employee’s privacy and allow them to speak freely.

Implications for the team

While an exit, whether voluntary or involuntary, can impact the team, the disruption can be limited. This is an opportunity to review the team’s roles, responsibilities, processes and workflows.

Most teams generally anticipate some additional work while a replacement is being identified. During this time, support for the remaining team is crucial or a domino effect may be expected.

Managers can spend more time with each team member and modify work goals. At the same time, take a genuine interest in each employee and also help them achieve their personal goals. It’s the latter that also increases employee engagement, something in high demand especially during these times of change.

Just as current work arrangements are being reviewed, focus on making knowledge sharing and succession planning integral parts of running your business. Being pro-active now can reduce the impact of future resignations.

Create a succession plan where you identify those employees who could immediately step in, even if it’s only for a specific period, and who needs to be prepared within the next 6 or 12 months or longer. Do you have any employees who could be cross trained to reduce your dependencies on one individual leaving? Decide what specific training and exposure they’ll require and then start getting them ready. Depending on the transparency levels within your organisation, you may wish to inform these employees about your succession plans while also carefully managing their expectations.

The replacement

As you’re considering the current team structure, you may decide that a replacement is no longer needed. Perhaps you place this role on hold, profiting from manpower savings and only revisit the potential recruitment activities in a few weeks or months.

Should you have determined that freezing the vacancy is not an option, start thinking about the requirements on the role and the ideal candidate. It can be a challenge finding the perfect successor for your star performer. By understanding your team’s needs, you can narrow down on the must have skills, knowledge and experience. You’ll be able to recognise desirable abilities and traits as a differentiator between two (or more) equally suitable candidates.

You may choose not to recruit for the replacement externally and select an internal candidate, although their profile may not be a 100% match. Such a decision may be linked to your overall EVP and HR strategy, focusing on growing talent internally and reinforcing your company’s stand on internal career progression. You’ll provide the internal candidate with an individualised learning plan, acknowledging the support and training they require from you to become successful in the new role.

Make for a smooth exit

While notice periods vary from role and level within the organisation, motivation generally declines quickly after giving notice. It’s best to start the hand over as soon as your top employee handed in their resignation. Agree which activities need to be completed or to whom they need to be handed by what date. Obtain log in details and passwords. Decide who will notify customers about the individual’s departure. When will that communication go out and how?

If your star performer is in a sensitive role, you may wish to put them on garden leave. If you decide that, how will you extract their knowledge and manage the hand over?

Some individuals may ask to shorten their notice period. As tempting as it is to hold them to the entire notice period, be honest with yourself: How much will they actively contribute 9, 10 or 11 weeks into their notice?

To keep the experience with your organisation a positive one, consider agreeing on an earlier end date, especially if brought up by the employee.

You can ask them to take any accrued but untaken leave days. This will reduce your financial responsibility to pay out any such days. Although it may be hard for you to appreciate it, you are, however, giving the employee some time to relax, finish working for your organisation on a high note and start their new job fresh. It all adds up to a positive image of your company and the employee being an ambassador for your organisation even when they’ve moved on.

Finally, wish them well. You may not want to throw a big farewell party. Yet, you may wish to give them a card and say good-bye with dignity and respect. Cherish the good memories you, the team and your top performer shared.

Don’t be caught off guard when your top performer leaves. Contact us today and learn how we can reduce your organisation’s dependency on a single employee. Don’t be stuck in a crisis mode. Be prepared.

Succession planning – What’s the next role?

If your Finance Director has to be hospitalised, do you know who could take over now? Your top sales person just resigned, who in your organisation could to fill this role?

The departure of a key employee can leave an organisation in a state of uncertainty. Succession planning is the answer to reduce such interruptions and provides stability.

What is succession planning?

Succession planning more than a mere replacement planning. It takes a comprehensive and integrated approach to identifying and growing the talent pipeline to “fill business-critical positions in the future”. It identifies the next generation of leaders and has also become a common tool to tackle skills shortages.

As both small and large businesses need to ensure business continuity, succession planning can be seen as a form of risk mitigation. Preparing and developing existing employees for their next internal move can reduce potential disruptions to the daily operations and reduce the financial loss caused by an employee’s departure or unavailability of talent.

Lay the foundation

It’s all about the role. Dave Ulrich reminds us that succession planning doesn’t start with people. “It starts with the requirements of the position.” While some companies focus solely on the top of their house, others go down deeper in their organisation and cover every role. A third approach is to address only business-critical positions. Any organisation will therefore need to decide its very own approach to success planning.

High potential employees vs. all employees. Focusing on high potential employees for succession purposes allows companies to provide very targeted development opportunities. In times where budgets may be limited, this may appear as the appropriate way of making the most of such constraints.

To not be restricted to a small group of employees, most companies consider all employees for their succession planning. This sets the basis for a fair review of previous performance.

Companies need to keep in mind that not all high performing employees also have the potential and/or aspiration for a higher level role. They may, however, be a potential candidate for a lateral move.

Internal vs. external candidates. For some companies, succession planning is closely linked to talent management and only internal candidates will be considered for senior roles. Existing employees are already living the organisation’s culture and values and technical expertise can be taught.

While an external candidate may bring a fresh perspective and new skills, they may not fit into the team, potentially taking the company back to square one.

The individual’s readiness. Organisations need to differentiate the employee’s readiness to take on a new role. This review illustrates the organisation’s internal talent pool and simultaneously the training and preparation requirements for each role.

The immediate readiness would be for emergency covers on a temporary basis or for a start in the new role today. Medium-term readiness could be around 12-18 months while a long-term successor, e.g. for a senior role, may require 3-5 years. It’s been reported that the former CEO of McDonald’s, Jim Skinner, coached and prepared his successor Don Thompson for almost 7 years. The preparation for GE’s current CEO, John L. Flannery, who took over in August 2017, was started in 2012.

Top management support. In a crisis, decision making often concentrates on immediate needs rather than strategic and sustainable solutions. To benefit the most from succession planning, top management needs to own this process and align it to the long-term objectives of the company. Their expertise will also need to be shared as part of the internal coaching and mentoring.

Not having the right talent in house can substantially influence the organisation’s competitiveness, potentially to the point of not being able to stay in business at all. Which company can afford this?

Integrate succession planning with core HR programmes

Insights from the performance discussions. Moving away from the dreaded performance reviews, line managers are urged to give more timely feedback. The continuous conversions provide an opportunity to review an employee’s behaviour, attitude, skills, knowledge, experience and talent (BASKET).

They can further learn about the individual’s career aspirations, although not every employee may have the trust in their line manager to honestly share their ambition.

The more an organisation understands their employees’ BASKET and career goals, the more can this be reflected in the succession planning. Under the traditional approach, an employee may not have been considered for a position while the additional insights also highlighted transferable skills of the individual, making them a suitable candidate.

Identify gaps. Reviewing the requirements for the identified future roles, an employee may have certain BASKET gaps. The regular feedback and the structured performance discussions can be used to reveal these while constructive 360-degree-sessions can be utilised for a more holistic assessment. After all, an employee will not only work with their line manager but a variety of individuals. Based on these gaps, HR can prepare a customised development plan for the employee.

Provide development opportunities. Whether this is by coaching, mentoring, training and special assignments, companies should utilise all development channels and can apply the 70-20-10 model. Here, 70% is linked to experience, for example gained from stretch goals or working on certain assignments or taking the lead for a particular project. 20% of the individual’s development comes from coaching, mentoring and knowledge sharing with others and the remaining 10% from formal training programmes or webinars.

The training and development initiatives for the future role should be integrated into the regular learning activities as arranged by HR and the current department.

If no central training system is used, the company needs to ensure the effective usage of resources. Communication between HR and the current department needs to be smooth to avoid booking the same training course twice.

Regular succession reviews. For smaller organisations, succession planning and performance management may be done on post-it notes stuck on a white board. This works for some.

However, for an organisation that wants to be more efficient, agile and/or grows, a home grown succession and skills database, tied together with performance and training elements, may be more appropriate.

For larger organisations, specific and integrated succession planning modules from vendors like SuccessFactors, Workday or Saba may be more suitable.

Depending on the organisation’s industry, an annual succession planning meeting will not suffice. Review meetings on every 3-6 months may be more appropriate.

Start your succession planning today

Succession planning reinforces an organisation’s commitment to their employees. It shows the company’s investment in employee development and creates career paths upwards and sideways.

Hiring from within the organisation can be a cost-effective recruitment tool. Internal candidates have already proven their cultural fit and can be acquire the missing skills and knowledge through a personalised development plan.

Overall, succession planning prepares an organisation for the unexpected and gives the company stability and sustainability required during disruptive times.

Can your company afford not to implement succession planning? We prepare organisations for the unforeseen by creating customised HR solutions fit for their business now and in the future. Contact us and find out how we can support your company.