Compensation committee hears overview of succession planning

May 05, 2016

UNIVERSITY PARK, Pa. – The Penn State Board of Trustees Committee on Compensation was given an overview of succession planning in higher education during its meeting today (May 5) at the University Park campus.

Succession planning and retention of key personnel is important for the future of Penn State, or any institution, according to consultants who provided a presentation to committee members. Sibson Consulting, a firm that specializes in human resources and benefits consulting for corporations and nonprofits, including institutions of higher education, was on hand to talk about the critical need for continuity and proactive processes that foster this preparedness.

Susan Basso, the University’s vice president for human resources, said that the Board of Trustees’ risk subcommittee annually identifies potential institutional risks, then assigns these risks to various board committees to discuss and work through. Succession planning and retention of key personnel is an area of concern that the compensation committee has been asked to oversee.

“This is a topic that has a good deal of national attention, particularly in higher education,” Basso said. “Our compensation consultant prepared a high-level presentation for discussion among committee members. At this time, we are not talking about specific people or positions – just the concept.”

Gary Langsdale, Penn State’s risk officer and a member of the risk subcommittee, said, “This is the start of the conversation about how the University undertakes succession planning.”

He said succession planning will help to create an orderly transition process as leaders and managers retire or leave the institution. Succession planning also allows an institution to ensure there is a sufficient source of possible leaders for the future by creating a systematic process to identify and diversify the talent pool.

The presentation from Jason Adwin, a senior vice president at Sibson, pointed to the growing need for diverse candidates and the fact that higher education is on the “verge of generational turnover in senior leadership.” About 20 percent of first-time presidents are now coming from outside of higher education and the average age of a university president in the United States is 64. The consultant also noted a need to focus not only on presidential succession, but executive talent outside of the president’s post.

Adwin also noted that for a number of reasons, there has been some resistance within higher education to plan for leadership succession. One reason is the uncertainty encountered when trying to communicate with and manage potential successors. He also noted leadership resistance as a common factor for lack of planning and, historically, higher education has not been proactive in this area.

Some key steps identified as part of a successful approach to succession include:

  • Identify executive roles needing succession plans;
  • Define the future requirements of key jobs;
  • Assess the strength and development needs of the talent pool;
  • Take development actions; and
  • Predict succession needs and starting selection processes proactively.

“It’s not just the president or the president’s cabinet. It’s all facets of leadership down through the department level,” Langsdale said. “This is about fine tuning processes and mechanisms that will help pick potential leaders. We’re collectively talking about this now so we’re ready for it.”

 

Last Updated May 05, 2016