By Adedapo Adesanya
Nigerian Microfinance Banks (MFBs) could face a number of problems if a good succession plan for its leaders are not put in place, one of the leading consultancy companies in Nigeria, Phillips Consulting Limited (pcl.) has said.
An associate partner at pcl, Ms Foyinsola Akinjayeju, said this during a presentation titled Steps for Effective Succession Management at a recent conference organised by the Lagos State Chapter of the National Association of Microfinance Banks.
She noted that MFBs could face power tussles issues if an inefficient leadership process is not place and could lead to sudden exits across different grades and functions; loss of tribal knowledge; costs of abrupt hiring; uncertainty; chaos; damage to the company’s culture; reduced performances which may culminate in business failure.
According to Ms Akinjayeju, “Preparing the next generation of leaders has become more imperative than ever. Some companies meticulously follow procedures of “next-in-line” for leadership roles yet their new leaders are ill-prepared for the role and end up as corporate placeholders, at the centre of chaos.”
She advised business leaders not to restrict their planning scope to the present alone, but rather to ask themselves if their team were the best talent for the future, a situation which she noted could be influenced through effective succession management.
Distinguishing between succession management and more common practices of succession planning and replacement planning, she cited their areas of differences around Focus; Successors; and Time Investment required.
Ms Akinjayeju noted that replacement planning focuses only on managerial positions and identifying talent to replace individuals who leave such positions while succession management, on the other hand, is concerned with corporate-critical positions across grades, profiling the talent (mix of job skills and unique competencies) required for such positions, identification of the suitable talent, deliberate development of the identified talent, and regular monitoring of the process to measure its effectiveness in respect of the strategic objectives of the organisation.
She said organisations which seek long-term sustainability must adopt a robust succession management system while also focusing on talents who demonstrate high potential.
On his part, Mr Rob Taiwo, the Managing Director of pcl, highlighted the importance of character, which he indicated as a better determinant of performance over competence when hiring a leader.
“Challenges often arise in the seemingly small areas like stakeholder engagement, culture, or perception and the one thing leaders need to keep going is grit,” he said.
He also added that there was the need for a shared purpose between the Chief Executive Officer (CEO), the Chairman, and the board. He stressed the importance of appropriate timing and extolled authentic leadership as a key success ingredient, admonishing CEOs to give guidelines only and not impose their methods on their successors.
