Untitled - Saigontre

What Is Succession Planning and Management?
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that Welch was reluctant to give up power proved unfounded: Immelt will take over
in December, eight months later than originally scheduled.
Welch flew to Cincinnati and Albany to give McNerney and Nardelli respectively the
bad news. Both men are now CEOs elsewhere. Welch says he will never reveal the
reasons that Immelt emerged triumphant, but his youth—he is 44—his popularity
and the perception that he has the greatest capacity to grow must all have been
factors. Frank Rhodes said that he demonstrated ‘‘the most expansive thinking.’’
If he is to survive and flourish like his predecessor, Immelt will need to continue to
develop that quality.
The General Electric approach to finding Jack Welch’s successor as CEO was thorough
to the point of overkill. On the other hand, we are talking about the world’s
most valuable company. Welch was absolutely determined to succeed, where many
major companies have failed recently, in finding the right man for the job. It will be
fascinating to see whether Jeffrey Immelt fits the bill.
Note: This was a precis of an article by Geoffrey Colvin, entitled ‘‘Changing of the Guard,’’ which was published in Fortune,
January 8, 2001.
Source: ‘‘How General Electric Planned the Succession,’’ Human Resource Management International Digest 9:4 (2001), 6–8.
Used with permission of Human Resource Management International Digest.
agement positions or management employees. Indeed, an effective succession
planning and management effort should also address the needs for critical
backups and individual development in any job category—including key people
in the professional, technical, sales, clerical, and production ranks. The
need to extend the definition of SP&M beyond the management ranks is becoming
more important as organizations take active steps to build highperformance
and high-involvement work environments in which decision
making is decentralized, leadership is diffused throughout an empowered
workforce, and proprietary technical knowledge accumulated from many years
of experience in one corporate culture is key to doing business.
One aim of SP&M is to match the organization’s available (present) talent
to its needed (future) talent. Another is to help the organization meet the
strategic and operational challenges facing it by having the right people at the
right places at the right times to do the right things. In these senses, SP&M
should be regarded as a fundamental tool for organizational learning because
SP&M should ensure that the lessons of organizational experience—what is
sometimes called institutional memory—will be preserved and combined
with reflection on that experience to achieve continuous improvement in work
results (what is sometimes called double loop learning). 5 Stated in another
way, SP&M is a way to ensure the continued cultivation of leadership and
intellectual talent, and to manage the critically important knowledge assets of
organizations.
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