Posted on July 12, 2022
Who’s Your Backup? 5 Reasons Why an Employee Back-Up Plan Means a More Secure Company
When it comes to data, we can all agree that running a backup is critical for several reasons. In a recent survey of over 100 LBM businesses, nearly all (94%) actively back up their data. It is safe to say that any data loss can potentially cause business interruption and can, in most cases, negatively impact the bottom line for even the strongest of organizations.
Isn’t it interesting that, on the other hand, most companies (approximately 75-80%) don’t look at employee backup? Ironic, though, because just like data loss, losing a key leader or impact player has the same potential of interrupting business. The financial impact can be far more significant, depending on the circumstances and if you are caught unprepared. So why are many business leaders far less proactive in investing to back up key team members?
While it may not be at the top of every leader’s mind every day, or when looking at your talent bench, look at the following five reasons why investing in a talent backup plan or strengthening your bench can prevent disaster and make your company more robust in the future.
It Reduces the Cost of Turnover
Here’s the scene: Your VP of Sales gives notice, deciding to move to the competition. This unexpected situation is not rare; it happens every day. More importantly, it can create a snowball effect across the organization. Your top accounts experience a leadership gap, others within the organization are called upon to extend themselves to fill the void, and top management is left scrambling for solutions. For companies lacking bench strength, backfilling positions from scratch means steeper learning curves, more time spent onboarding, and greater productivity and profitability losses. Given that the average tenure for most employees is only three to four years, it is not just asking if it will happen to you, but when and if you are prepared with people ready to assume the now open role? Hope for the best, plan for the worst.
It Challenges Your Current Team to Become Thought Leaders.
We hear from more company executives talking about bench strength or succession planning. We have been working on many searches where the directive is to find “thought leaders” to assist the top managers by bringing new perspectives and ideas and challenging the norm. The most successful company leaders benefit from having one or more well-informed backups who deeply understand the issues at hand and can provide secondary (or tertiary) perspectives. Rather than make decisions based solely on their instincts, companies whose leaders are open to having their thoughts and ideas challenged are poised to become more evolved in their thinking. They are also more likely to develop innovative solutions to give their businesses a competitive advantage in the marketplace.
It Better Prepares Your Potential High Leaders
While most business leaders agree it’s risky not to have a succession plan for key employees, a survey of nearly 1,000 senior managers and executives from AMA revealed that roughly a quarter of companies have done no succession planning. Only 8 percent have a “comprehensive development program that is part of the business plan.” To ensure continuity of leadership, organizations need to think multiple steps ahead, not only to continue to develop their current executives but also to work diligently to identify and hire their next wave of leaders so they can be fully prepared to transition into vital roles when needed seamlessly.
It Alleviates Pressure from Top Performers
In the professional sports world, the teams with the most robust benches can consistently overcome challenges and achieve wins late in the season. Whether an injury sidelines a key player, a star burns out due to too much time on the field, or disenchantment or disengagement strikes at a critical time, business leaders know these same challenges can affect their top performers. If an organization wants to go the distance, key players must be given the support needed to manage growing workloads, maintain motivation, and avoid burnout. The last thing any business owner wants is to be forced to sideline an all-star or drive them away to another team.
Word Gets Around
People talk about successful companies; hell, most of our industry publications brag up the top 100. Top Teams are in demand, and Top Talent wants to play for winning organizations. The best companies in the LBM space constantly discuss bench strengths, adding depth, succession planning, etc. One client of ours brags that they don’t need to look hard to find talent because their popularity in the industry drives people to them.
So what does this all mean?
To ensure the long-term stability of your business, it’s just as critical to focus on the future as the present. Regarding talent management, surprises are rarely—if ever—a good thing, making preparation key to an organization’s sustainable success. As your company evolves, ask if your talent pipeline aligns with your long-term business strategy and assess whether your future leaders exist in-house, can be nurtured, or need to be hired from the outside. The more proactive you can find and develop strong leaders now, the more stable your organization will be over time.
Does your organization have the “bench strength” necessary to maintain consistent leadership over time? At SnapDragon Associates, we help our clients’ organizations and critical leaders plan for long-term success through recruiting services tailored to their unique needs. To learn more, call us today at 603-621-9037, or visit us at www.snapdragonassociates.com.