Succession planning sounds straightforward on paper. You map out who could take over key roles, invest in their development, and when the time comes, you have someone ready to step in. Simple, right?
In practice, it’s rarely that tidy. Plenty of organisations say they have a succession plan, but when a leader leaves — especially unexpectedly — the reality often tells a different story. The plan doesn’t hold. The people earmarked as “next in line” aren’t quite ready. Or worse, they were never that interested in the role to begin with.
So why does it go wrong so often?
It’s common for companies to identify successors based on loyalty or tenure. Someone who’s been with the business for years, knows the ins and outs, and seems like the safe bet. But familiarity and capability aren’t the same thing.
Take Rolls-Royce Holdings, for example. When CEO Warren East announced his departure in 2022, there was speculation about an internal replacement. But the company opted to bring in Tufan Erginbilgic from BP. Why? Because the board wanted a reset. They didn’t just need continuity — they needed someone who could shake things up. That internal candidate may well have been capable, but wasn’t aligned with what the business needed at that moment.
Succession should be about fit — not just for the role, but for the direction of the business. That means thinking ahead, not just sideways.
Far too often, succession plans are written and filed away. Names are listed. Maybe there’s a bit of coaching or the odd development course. But no one is really preparing that individual for what the top job entails.
Real preparation takes time. It means giving people uncomfortable challenges. Exposure to board-level conversations. Opportunities to lead across functions, not just within their own team. It’s not about ticking training boxes — it’s about building resilience and range.
One company that’s taken this seriously is Unilever. When Alan Jope stepped down as CEO, his successor — Hein Schumacher — was already deeply familiar with the business. He’d led regional operations and had returned after gaining CEO experience elsewhere. The company didn’t just keep a list. They invested years building someone who’d be ready, when the time came, to take the wheel.
It’s tempting to hand over succession planning to HR and treat it like a talent admin task. But it’s a board-level responsibility — especially for critical roles like CEO, CFO, and heads of major business units.
Boards that take this seriously revisit the topic regularly. Not just when someone’s about to retire, but well in advance. They ask hard questions: Who’s ready now? Who could be ready in two years? Who might be gone in twelve months, and what’s the real plan?
When Diageo had to move quickly to appoint Debra Crew after the sudden passing of Ivan Menezes in 2023, their ability to do so smoothly reflected the groundwork already in place. It wasn’t perfect, but it could’ve been much messier without prior preparation.
Poor succession planning doesn’t just cause short-term disruption. It sends a signal — to staff, shareholders, and the market — that leadership continuity hasn’t been taken seriously.
It can also backfire culturally. If internal candidates feel they were strung along, or left in limbo, resentment builds. If external hires are brought in abruptly, without explanation, it damages morale.
And it’s not just a people issue. Share prices can take a hit. Strategy loses momentum. Confidence falters.
Here’s what seems to work, based on what we’ve seen from companies who handle this well:
It also helps to check in with the candidates themselves. Just because someone looks ideal on paper doesn’t mean they’re aiming for the top job. Ambition can’t be assumed.
A succession plan is only as good as the thinking — and honesty — behind it. When it works, it provides continuity, clarity, and confidence. When it doesn’t, even the strongest businesses can be thrown off course.
This isn’t about rigid pipelines or detailed grids. It’s about staying close to your talent, understanding what’s coming, and building towards it — not just hoping you’ll get lucky when the time comes.
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