Why Succession Planning Is Important for Local Government Boards

The chairman of the board moves to another state. The head of the personnel committee retires. The treasurer needs a sick leave for an unknown amount of time. Where does that leave the board of a county or town? With advance planning, the change can mark little more than a speed bump. Local government boards need succession planning to anticipate future transitions and prepare for unexpected ones.

Consider a city that has had a board succession plan in place for years. When the treasurer is rushed to the hospital and ordered not to work just two weeks before the final town budget is due, a skilled and trained successor fills her shoes immediately, putting the finishing touches on the budget and presenting it to the mayor with confidence and poise. That town had anticipated future leadership transitions and identified skilled successors who were thereby trained and ready to go on Day One. By design, those successors also brought the right complement of talents and expertise to keep the board balanced.

Now consider a town with no such plan in place. Its treasurer, too, must abandon his duties at the drop of a hat just two weeks before the budget is due. Power struggles and chaos soon follow. The other board members scramble for a replacement, even advertising online and interviewing external candidates. Under time pressure, they settle on someone who does not know the organization, may not fit into the culture, and has some – but not all – of the experience that the job requires.

One calamity follows another. Supporters in the town and in the state government may take a “wait and see” approach to the replacement. The board loses entirely the knowledge, relationships and expertise that the original treasurer had accumulated over many years. If the replacement is a bad fit, it can create organizational dysfunctions that take years from which to recover. If an organizational crisis led to the leader’s departure, introducing further instability throws gas on the fire.

The sloppy, compromising, expensive approach of the second town undoubtedly reflects a continuing climate of reactivity that impairs board effectiveness 365 days a year. Boards with succession plans have higher retention rates and better morale than their unprepared counterparts. They also create an organizational climate that thrives on innovation and change. They enjoy continuity of stakeholder trust, retain institutional memory, and maintain vital relationships with constituents and state officials.

The experience of boards who benefit from succession planning suggests the following best practices:

  1. Gain the commitment of the board to manage each leadership transition intentionally.
  2. Adopt a succession policy, clarifying that the board is responsible to plan for future leadership changes.
  3. Draft a timeline of any planned or predictable leadership successions.
  4. Identify the current challenges facing the board and those that lie ahead.
  5. In light of those challenges, create a skills matrix to identify skill gaps that may arise; keep an eye on that matrix when replacements are sought.
  6. Consider if and how you wish to use interim replacements.
  7. Adopt an Emergency Leadership Transition Plan to address the timely delegation of duties and authority whenever there is an unexpected transition or interruption in key leadership.
  8. Identify opportunities for current board members to learn new leadership skills so that the board has a “deep bench” of future leaders.
  9. Plan thoughtful communications. Have on hand what your board will say to stakeholders before, during and after a leadership transition.
  10. Create a one-year “ex officio” spot on the board for outgoing leaders who retire and stay in the community.
  11. Make one person on the board responsible for “knowledge management” – keeping track of who has various bits of institutional memory and expert insights, with an eye to retaining that knowledge by passing it down to younger members over time.
  12. Have each board member think about how to support his own succession.

A growing number of local governments are facing succession challenges, and the number is predicted to rise. David Stewart, Treasurer and Tax Collector of The Municipality of Hasting Highlands, reported in 2016: “Many municipalities in Ontario are staring down a deficit of critical human infrastructure as the current generation of municipal professionals prepares to retire.” As they leave, he adds, they will “take significant accumulated knowledge, expertise and experience with them.” (AMCT)

Three historical forces brought us to the point of numerous imminent leadership changes. First, only 13% of municipal leaders are under the age of 40 today, whereas almost 71% were under 40 in the early 1970s. It doesn’t take an actuary to see a spate of deaths and retirements ahead. Second, baby boomers have begun retiring in large numbers, in a trend that will continue for the next 15 to 20 years. Third, attention to succession planning fell by the wayside in the wake of the 2008 recession, as local governments devoted all their attention to meeting short-term needs on tighter budgets.

Intentional governance must include deliberate planning for leadership transitions. It is inevitable that board members will rotate off the board, get sick, retire, move out of town and resign. Succession planning turns those coming moments into gracious exits.

Sources:

AMCT: “Human Capital Management – The Need for Succession Planning in Smaller Municipalities,” a report prepared for the Association of Municipal Managers, Clerks and Treasurers of Ontario Diploma in Municipal Administration” January 2016

Anderson, George; Bamford, Tessa; Daum, Julie Hembrock, “Succession Planning for the Board” spencerstuart.com January 2015

BakerTilly, Inc., “Succession Planning in Government: Why is it still relevant?” August 2011 at www.bakertilly.com

Robert Half, Inc. “Succession Planning,” April 19, 2018

“Succession Planning for Nonprofits – Managing Leadership Transition” at www.councilofnonprofits.org/tools-resources/succession-planning-nonprofits-managing-leadership-transitions


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