Compiled By Deborah Austin Nearly half of today's largest U.S. companies lack meaningful CEO succession-planning processes. Yet leadership development plans can greatly impact the bottom line, suggests the recent study, "Succession Planning for Results," from business research firm Cutting Edge Information Inc., Durham, N.C. Cutting Edge, which profiles 70-plus metrics from 33 major companies including General Electric Co., Hewlett-Packard Co. and Pfizer Inc., outlines five principles for succession planning:
- Build comprehensive succession plans at multiple levels, including "C" level managers and department heads. Beyond building candidate lists, link people with employee-development programs.
- Execute plan with discipline, prizing long-term gains over short-term growth. Even the best plan is ineffective if not followed.
- Ensure top officers are covered by succession-planning process.
- Conduct 360-degree reviews of candidates -- gathering information from superiors, peers and subordinates.
- Build an "academy company" that values producing executives similarly to universities producing scholars.