Succession Planning for an Aging Public Sector Workforce
By Linda Kegerreis
Workforce Consultant and former Chief Workforce Officer for CPS HR Consulting.
Public sector employers are facing an impending mass exodus of senior workers, the likes of which has never been seen before. While workers across all sectors are closing in on retirement age, it’s in the public sector that some of the oldest can be found.
According to the Bureau of Labor Statistics, government workers’ median age is 51, and 70 percent of them are also older than 45. The California Public Employees’ Retirement System (CalPERS) reported that for fiscal year 2012 through 2013, the average retirement age for all CalPERS members was 60.
Fortunately, it is doubtful that all of the Baby Boomers will retire en masse tomorrow. In fact the recent recession reduced retirements over the last two to three years, but those postponements are slowing. About 38 percent of International Public Management Association for Human Resources members reported in a survey earlier this year that their eligible employees were postponing retirements, down from 46 percent in 2012. Rex Facer, an associate professor at Brigham Young University who studies workforce issues, said that as the economy continues to improve, more public employees could begin to head for the exit.
While this looming retirement picture has long occupied much discussion, the pressing concern for executives and HR managers are those suddenly empty chairs in government offices across the nation. Those in leadership positions throughout government agencies are well aware of the fact that the public workforce is aging. However, the level of preparedness with which government agencies are to fill this void varies considerably.
When it comes time to acquire new talent – particularly executive level leadership in the public sector – there are two choices:
1. Grow the leadership capability internally, or
2. Buy the talent needed by recruiting established leaders externally.
Both methods can have advantages and disadvantages; but it is important that the strategy selected be chosen thoughtfully and purposefully, rather than it just happen sporadically because proper plans were not in place.
Promote From Within vs. Hire Externally
To start off, let’s look at some of the pros and cons of both methods.
In addition to lower hiring costs and less time needed to fill the position, there is less overall risk when promoting from within. An organization knows an employee’s strengths and weaknesses. The employee knows the organization’s culture, business operations and players. If the original selection process focused on the required competencies, skills and knowledge as well as applied consistent, methodical approaches to leadership talent development over time, it is ideally best to promote from within.
Alternatively, depending on the position and current organizational needs, hiring externally can be just what is required. It will probably cost more and take more time to find just the right person, but that individual is likely to have better education, experience and knowledge than available talent in an internal workforce. The external candidate has worked for other organizations, so they will bring new viewpoints and insights as well as provide an objective look at the organization. If a turnaround or change agent is needed, an external hire is usually more appropriate. But, what is gained in experience or industry knowledge, is lost in immediate effectiveness. The external hire has to learn a new culture, people, processes and business – and that takes time. There is more risk in hiring an unknown candidate.
Growing Talent Takes Commitment
The critical component in being able to effectively promote from within is to have an active leadership pipeline that can supply the right leaders in the right roles at the right time. This isn’t easy and can be expensive. Organizations that have all the pieces in place to grow their own talent invest heavily in doing so; they are committed to it at the highest levels.
Certain conditions must exist within an organization to build and grow talent successfully. If these things are in place, the organization can and should grow the internal talent to fill a large number of leadership positions.
When conditions are right for growing internally, there is a strong culture which supports and encourages learning, development, skill and competency building. The organization dedicates resources to these efforts and it is a core value for supervisors, managers, executives and employees. There is supportive leadership in place who have the desire, capability and willingness to build and grow talent.
Growing leaders requires time and a long term view to sustain the commitment to the employee’s development – not just providing training. They need mentors, coaches and guides who can have honest, direct conversations about strengths, weaknesses, successes, challenges and failures.
Development programs and processes should be in place that emphasize maximizing potential, performance, effectiveness and solutions, but also educate, spark innovation and move people beyond their comfort zones. There are many ways to accomplish this but some examples include succession management programs, mentor programs and assessment and development plans.
An organization with a good growth pool will have advancement opportunities that allow for promotions for high-potential employees over time. For flat or small organizations with little internal movement and low turnover, this may be a challenge.
Finally, a key facilitator to growing from within is being in a strong and sustainable financial position, with the ability to dedicate resources to development efforts on an ongoing basis. This type of organization should also be concerned with retaining highly talented staff and motivated to retain high-potential employees. Executive and management level sponsorship will be accountable for shepherding and driving the organization’s efforts to grow talent.
Using a Blended Approach
If the resources or the above mentioned programs are in place, the organization is fortunate that it can use both hiring options. It can build talent internally for key leadership positions and buy the talent that is needed as circumstances require. External recruitments would be most appropriate for very specialized positions such as when a new product or service area is being launched, when there is weak bench strength in that content or service area, when the position requires a turnaround or transition role, or when new innovations are necessary.
If the organization is not able to meet the above internal conditions, it will be better off buying talent externally while trying to mitigate the downsides of relying largely on external hires.
Mitigating the Downsides of Buying Talent Externally
Organizations without the resources to grow talent internally have to recruit established leaders externally. There are a few things to keep in mind to mitigate some of the downsides of external hires that focus around culture and fit, learning curve and team integration challenges.
Recruitment and selection process
First, make sure the organization engages in a thorough and professional outreach, screening and selection process to provide a better chance of a successful leadership hire. Describe the success profile by discussing and clarifying the desired competencies, skills and knowledge required. Match candidates to these core content aspects first.
Then add behavioral competencies. What kind of mindset do leaders in the organization need to fit in with its culture? Is the organization slow-moving and hierarchical, fast-paced and urgent, tolerant of new ideas or quick to stop change? Does this job require a maintainer or a change angent? Make sure new hires match the company’s culture and the needs of the position. Research and use various kinds of assessments that will help capture this information. Add questions to the interview processes that get at these aspects.
Finally, do thorough vetting. Because the outside candidate is unknown, good references, Internet searches and background investigations can help round out the information about the individual prior to making an offer.
Support the new hire once they show up
Far too many organizations adopt the sink-or-swim mentality for new leaders. This is especially true when elected officials hire a new executive. Those in charge rationalize that if the new leader is so good, they will figure out how to be successful and survive. If you want them to merely survive, that may work; but if you want your new leader to thrive, put a process in place that helps them learn the ropes more quickly. CPS HR Consulting has a detailed checklist that covers core steps for executive and managerial onboarding, but here are a few aspects of that plan.
1. Pre-Employment Phase
o Gather materials, obtain equipment and begin scheduling meetings.
2. First Day
o Make sure first impressions are positive.
o Meet with bosses, elected officials, town hall meeting with direct staff.
3. Lay the Foundation
o In the first 30 days, there are multiple meetings with direct reports, staff members and stakeholders in and out of the organization. Attendance at and observation of regular, recurring meetings is planned and calendared.
4. Build Competence and Strategy
o In the next 60 days, create frequent opportunities for discussions throughout the organization. Fold in external perspectives with more external stakeholder and partner meetings. The new hire begins developing action plans and addressing substantive issues.
5. Formal Feedback
o At six to nine months, provide formal feedback on performance thus far from direct supervisor(s). Then, the new leader begins implementing action plans.
The quality of leaders makes a difference to the communities that are served. The impact of failed leadership in the public sector is plastered across the Internet and media. As a result, the citizens, staff and organization’s reputation suffer for it.
Organizations can grow its own or go out and buy talent. Either way, put a plan and processes in place to support goals and strategy; don’t just hope leaders will grow and evolve.
As an integrated HR service provider, CPS HR Consulting can help you with advice and assistance or delivery of key services to support your planning efforts, recruitment and selection activities, succession planning and management, and onboarding processes. You can contact us at 916-263-3600916-263-3600.
About the Author
Linda Kegerreis is the former Chief Workforce Officer for CPS HR Consulting. She has more than 30 years of human resources program experience that includes 20 years as an HR director in the public sector working for cities and counties.
As an experienced public sector executive, she offers exceptional depth in human resources, particularly employee relations, performance management as well as recruitment and selection. Linda also provides consulting services in the areas of FLSA, performance management, pay for performance, recruitment, recognition and reward systems and succession management. Connect with Linda Kegerreis on Linkedin.