Too big to fail?

By Samuel R. Chand

A lack of succession planning will hinder an organization from moving forward.

Words enter our vocabulary at a variety of junctures. For example, the economic recession has popularized words like “bailout” and “stimulus.”

The one that keeps catching my attention is “too big to fail.” A book and movie by the same title have tried to describe how certain enterprises are so big and interconnected that the failure of one organization will have disastrous implications for others.

The Crystal Cathedral’s bankruptcy and subsequent sale, along with very public disputes among family members in leadership, should be a clear sign that no one is too big to fail.

Transition by attrition
In my book Planning Your Succession co-authored with Dr. Dale Bronner, we postulate that succession is not about filling leadership vacancies; it’s about creating an organization’s future. Creating your organizational legacy is either by design or default.

Estimates have it that in the next six to eight years, more than one-third of American churches will experience pastoral transition not by transition, but by attrition. That means almost 125,000 pastors who are leading churches today will not be pastoring anymore. Cumulatively, this phenomenon could be classified as “too big to fail.” We’re navigating uncharted territory without a good map – only a compass.

Consider the following facts:

  • One recent study – which benchmarked public and private companies with more than 1,000 employees – found that 46 percent have no systematic process for succession planning. And 78 percent reported that they find it very difficult to find qualified candidates for leadership positions.
  • Fifty-eight percent of small-business owners cite inadequate succession planning as the biggest threat that they’re facing.
  • Thirty percent of family-owned businesses are not considering their succession planning needs.
  • Only 1 percent of the 18 million family-owned businesses in the U.S. are expected to be family-run into a third generation.
  • Seventy-five percent of nonprofit organizations have no executive succession plan; more than 60 percent reported that they had no plan to plan.

Succession planning
Succession planning creates a leadership culture within the organization. A good succession plan ensures that your wisdom and knowledge as a leader transcend the current generation. It’s a great tragedy for a leader to be without a successor.

Perhaps the biggest reason for avoiding succession planning may be that it forces us to face our own mortality. To think that we are bigger than our church or that our welfare supersedes the sustainability of our church is a common factor in all imploding organizations. However this is a long-term issue. This cultural toxicity did not begin now – it has long and tangled historical roots.

Most of us planning leadership transitions aren’t thinking about how differently the world will be for those coming after us. Rather than looking for someone with the same DNA, we have to determine what direction the organization will be taking in the long term and look for someone who can chart the course. From this we can create a preferred profile of the person needed. Successors typically fall into two categories – those representing continuity, and those representing change.

Succession planning is about building the organization’s future. Advancing an organization’s competitive advantage and effectiveness is all about selecting and developing successors. Every leader has a responsibility to develop those who can move the organization forward.

A new beginning
Walking away is no easy task – the hardest thing is figuring out how to let go. Even when you’re no longer a pastor, there are talents and gifts that remain part of your nature and your essence. Making a transition can free us to consider our dreams.

It’s important to establish and maintain strong boundaries after your departure. Here are some common denominators in imploding organizations:

  • Hubris – thinking they can’t be replaced.
  • Staying too long.
  • Interfering after “leaving.”
  • Not preparing the runway. The larger the plane or organization the longer the runway needed for successful transition.
  • Not understanding the difference between change and transition. Change is when another leader assumes the steering wheel, but transition is all the emotional, relational, organizational, legal and other issues that surround change.
  • Not seeking external professional counsel via consultants who are not emotionally attached to the persons involved.
  • Not creating a healthy culture and becoming the sustainers of toxicity. Creating a healthy culture assures healthy transitions.
  • Family succession transitions are harder than non-family transitions. That is why only 1 percent of the 18 million family-owned businesses in the U.S. are expected to be family-run into a third generation.

Dr. Samuel R. Chand is president of Samuel R. Chand Consulting, Stockbridge, GA.


One Response to “Too big to fail?”

  1. Tony Andrade

    Thank you Dr. Chand for your insightful comments. You are so right and you have provoked me to seriously give special attention to your words of wisdom.

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