As per a recent survey, 2/3 of global organizations lack robust succession plans that leave them exposed to costs that can literally reshape their future.
From stalled decisions to loss of trust, succession risks leaders underestimate. But here's what keeps us as the best executive search firm up at night - only 29% of firms have a formal succession plan in place. The rest are operating on borrowed time.
The Price Tag You're Not Seeing
Replacing a highly-skilled executive costs up to 213% of their annual salary when you factor in hiring, onboarding, and lost productivity. That's just the beginning.
Poor succession planning destroys nearly $1 trillion annually in market value across S&P 1500 companies alone. Organizations without succession strategies experience 25% lower revenue growth than their prepared competitors.
When Leadership Gaps Become Strategic Paralysis
Here's what happens when a key leader exits without a successor ready:
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Decisions stall
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Your executive team scrambles
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Employees wonder who's steering the ship
Reaching peak productivity within a company requires an average time of 6 to 9 months for the new executive. In this limbo, projects stagnate, strategic plans stray, and your competitors are running at light speed. Your teams lose momentum while building trust with unfamiliar leadership.
We've seen C-suites where this "adjustment period" costs millions in delayed market opportunities. The market doesn't wait for you to figure things out.
The Talent Ripple Effect
The consequences extend far beyond the corner office. When succession planning is absent, your best people start questioning their future with you.
High-potential employees need to see clear advancement paths. Without them, they look elsewhere. You lose not just one leader but the institutional knowledge and relationships they've built over years, knowledge that's impossible to document or replace quickly.
Meanwhile
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Uncertainty cascades through teams
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Morale drops
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Productivity suffers
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The culture you have worked to establish starts to break.
Avoiding the Succession Trap (Practical Steps)
Succession risks are preventable. Here's where to start:
Step 1: Identify Your Critical Roles Now
Which vacancies do you think would have a serious bearing on operations, were left vacant tomorrow? Do not just stop at the C-suite, but should examine special positions two or three tiers below.
Step 2: Build Your Bench Systematically
Prepare personal development plans of high potential employees. Provide mentorship, rotation and practical leadership. It cannot be so casual as development.
Step 3: Make it Continuous, Not Crisis-Driven
Succession planning is not a one-time document. You must review your succession plan regularly & revise your plans (at least once a year).
Step 4: Start Small if Needed
It is important to concentrate on your 5-10 key jobs at first. A pilot program beats no program.
The Bottom Line
At The Taplow Group, we've guided countless organizations through succession transitions. The pattern is clear - companies that plan proactively outperform those that react.
Succession planning is not merely risk management; it is a competitive edge. It sends a message to employees, investors and clients that you are long-term.
The time to start is now, not when your key leader hands in their notice.