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In Segment two, we will discuss the practical steps in developing a Succession Plan There are two types of succession plans. The first plan is to fill the CEO position due to a sudden departure. This type of plan provides short-term steps to maintain organizational continuity until a permanent replacement is in-place. It's important to have the succession plan in place before an emergency occurs. The second type of succession plan is designed to prepare successors for a leadership position either for the CEO or other key positions. This includes establishing career paths and a framework for ongoing training and development. This graph represents the four stages of the succession planning process You'll note that the process is circular. After completing step four, you go back to step one and start again! As a part of the succession planning process, what positions are key in achieving the credit union's mission? It might be more than just the CEO. Ask yourself -- "Without this person or position how would the mission be affected and would vital functions be hindered without them"? Does the position require unique or highly specialized skills or leadership? Take into account your credit union's size & complexity. Also consider where you are located. What is the talent pool like in your area? And finally, consider which positions will be vacant soon. For each key position, identify the internal and external factors that affect this position such as the: Required business location, Services offered, Necessary business relationships and both the Culture and mission statement of the credit union. Assess competencies needed for the positions, such as management skills, regulatory knowledge, accounting knowledge and IT experience. Don't forget to include skills that may be needed in the future. This is a good time to ensure that there are written position descriptions that include required duties for each position. These will be invaluable for hiring, training and transition. Finally, identify the GAPS. GAPS are competencies and skill sets not possessed by the current job candidates. Step three is Develop the Succession Plan. The plan is simply the strategies you will use to overcome the GAPS identified. Including: Updating written position descriptions Identifying candidates for the job Assessing the candidates competencies and skills, and Training candidates to eliminate the GAPS Commit the plan to writing and make it specific: Exactly what will the training be? Who is responsible for the training Required resources Target completion dates, and Reporting progress to the board of directors What if there are no acceptable internal candidates? An external job search may be required, often the case with smaller credit unions. The board needs to determine: What each specific step in the hiring process will be, and how long will each step take? Have you allocated enough time? Consider the required skills and the local job market. Should the current CEO be involved in choosing their successor? Do the current officials have the necessary expertise to hire the right person without outside guidance? Or, should outside resources like a CPA firm, Employment Agency or Trade Groups be used? The last step, Monitor, Evaluate, and Revise means that everything changes. From personnel, duties, job descriptions and products, so the plan must be regularly reviewed and updated. If your board has a policy of reviewing all policies once per year, add Succession Planning to your review calendar. Remember, succession planning is an integral part of the strategic planning process. Your other strategic planning goals will not be reached without the right people to execute them. To avoid some common pitfalls, it is good to remember what Succession Planning is not: It is not a one-time event -- It is a process. Due to constant changes at the credit union, and in the strategic plan, the succession plan must be regularly monitored and revised. It is not an individual decision. It is ultimately the board's responsibility, but should involve the CEO, and other staff. It is not solely an individual career advancement opportunity. It is not a one-time reaction to an open position. It is not an envelope with a name or resume in it. It is not a manager relying solely on their own comfort or knowledge of potential candidates. And finally, it is not something just to make the examiner happy! What about a sudden & unexpected absence of the CEO or other critical employees? Based on the GAP analysis, can current employees fill in temporarily even if they are not the long-term solution? If so, for how long? It is critically important to have this conversation before an emergency occurs, so there's a plan and a process already in-place. This is where the advance planning for an external job search will pay off If you will need to use an outside search firm, can you do your due diligence review and chose the firm in advance to save time in an emergency situation? A creative solution to meeting an emergency situation is a mutual assistance plan. This is a plan between two or more credit unions to provide assistance filling key positions in an emergency situation. Key considerations in this type of plan are: Resources of the credit unions in plan. Will they be able to perform when the time comes? Do the respective personnel have the necessary skills? What will trigger the plan? Obviously it should only be in emergencies, not for vacancies known in advance. Duration of the assistance, Specific resources that will be provided, Compensation of personnel involved, 00:06:33.093,00:00:00.000 and Board approval.