Matching talent with tasks: Dole implements succession planning to get ready for changes at the top - HR Technology: Systems & Solutions

HR Magazine, Nov, 2002 by Bill Roberts

With 61,000 workers in more than 90 countries, Dole Food Company Inc. has talent all over the world. Only a few hundred of those employees are in top management at the 151-yearold company headquartered in Westlake Village, Calif., which produces and markets fruit, vegetables and flowers. Trouble is, Dole doesn't have comprehensive knowledge of who these managers are or what they can do.

To be sure, business unit leaders know their own direct reports well--their strengths, weaknesses, experience and career goals. The problem is, these leaders have no way to share that knowledge with other business units. If a key job opens up in North America, the business unit leader wouldn't know if the perfect candidate worked in another Dole unit in South America. Dole has no way to match its top managerial talent with its executive needs.

But that is changing. The highly decentralized company is launching a succession planning process, supported by web-based software, through which Dole executives hope to rectify their inability to promote the best and the brightest across the corporation.

"We are looking to execute an organized process where we will identify weaknesses and strengths of our people and build plans to deal with that," says George Horne, Dole's vice president of administration and support operations. "We also want to identify areas where we will need to bring in some people from outside to fill some gaps at the top."

Knowing Your People

Succession planning used to mean that a company president hoped his oldest child would join the family business and replace dad someday. If not the oldest, then any child would do.

Today, succession planning--also called workforce planning or progression planning--means having the right person in the right place at the right time for the right job, says Ren Nardoni, senior vice president at Pilat NAI, a Lebanon, N.J., subsidiary of Pilat Technologies International Ltd. of London. It means knowing your people, knowing their strengths, experience and career goals, and knowing where they need development. Succession planning helps HR and managers know what to do if a position becomes vacant. "You're looking for the vulnerabilities of the organization," he says.

Succession planning has grown more important since the 1980s and picked up steam in the 1990s. These days, experts say, most Fortune 500 companies take succession planning seriously, and many smaller companies embrace it.

Marc Kaiser, a consultant with Hewitt Associates in Lincolnshire, Ill., says savvy companies recognize that they must be prepared to tackle the leadership gap created by retiring baby boomers. The ability to easily automate succession planning using the web also drives interest. "It is easier now, and that's one reason people are doing it," he says.

Most companies that adopt succession planning automate it with software. Nardoni estimates that 50 percent to 60 percent of the Fortune 500 and 30 percent of the largest 2,500 U.S. companies have installed succession-planning systems--either stand-alone software or the succession-planning module in their HR management system (HRMS). "Our average client starts with succession planning for between 150 and 250 positions. The minute you get above 50 to 75 positions, it becomes a pain in the butt on paper," he says.

Government agencies, such as the Federal Aviation Administration, also embrace succession planning, Nardoni says, because they have to plan for people moving in and out and retiring. However, the government's succession planning initiatives don't have the same intensity as those of the Fortune 500, he adds.

Succession planning correlates positively with the bottom line, says Nardoni.

Kaiser points to a 2002 Hewitt study, "Top 20 Companies for Leaders," that shows that companies with reputations as good places to work have stronger succession planning and commit more resources to it, including the CEO's time. Hewitt surveyed some 348 HR executives and CEOs at 240 publicly held companies on various leadership topics, identifying companies that succeed in attracting, developing and retaining leaders, and noting the practices that influenced their success.

Dole's Culture Change

Succession planning was one of several corporatewide initiatives Dole launched in the past 18 months to decrease decentralization in an attempt to improve the bottom line, Horne says. The company was No. 353 in the Fortune 500 in 2002 with revenues of more than $4.6 billion.

Historically, Horne explains, Dole's seven business units were so autonomous that corporate wasn't much more than a holding company. When Larry Kern became president in February 2001, he set out to keep as much decentralization as made sense while adding some corporatewide accountability and processes.

Succession planning (Dole calls it progression planning) was one such change. The process itself would require a change of culture and could become an agent for further culture change. "The idea of succession planning is contrary to being highly decentralized," says Sue Hagen, vice president of HR for North American operations, who led the effort.