Creating a leadership pipeline or building of a middle level management team is crucial for succession planning in any organisation. No human resource (HR) manager ever wants a day to come when he looks at his senior managers and wonders how many will still be with him in the next five years.
Hence, creating a leadership pipeline has taken a centre stage for the corporates and the success of which also reflects in the performance appraisals of the HR managers. About 20-30% weightage of an HR executives? performance appraisal depends on creating a leadership pipeline.
JSW Steel Ltd senior vice-president (corporate HR) Anirudh Singh said, ?About 30% weightage of our performance appraisal depends on creating leaders for the organisation.? Corporates like Aditya Birla Group, JSW Group and also ICICI Group to name a few believe in creating leaders form within the organisation and are working on creating a team of leaders.
ICICI Bank executive director K Ramkumar believes that if you have the right fit inside, you don?t have to go outside. ICICI is currently working on institutionalising its leadership for the whole ICICI Group, which has about 80,000 employees.
For Ramkumar, 25% of his entire performance appraisal weightage is linked to the leadership pipeline.
Similarly, for Arvind Agrawal, president and chief executive (corporate development & HR) at RPG Group, 23% weightage of its total performance appraisal is linked to succession planning and leadership development. The group has a 75:25 policy for its leadership team, where of the total leaders, about 75% of the internal high potential and high performance candidate become a part of leadership pipeline and the rest 25% are hired from outside.
?We don?t want to block ourselves from talent available from outside. Businesses are expanding and in this environment one should have a ready pool of talent available to take up the challenge,? said Agrawal.
Likewise, the JSW group also believes in building a team from within and a large number of people at the top position in the JSW Group are from within.
?But as we are expanding fast, we will have to depend on some positions from outside also,? adds Anirudh Singh.
Experts are of the view that internal candidates are known devils and risk free to that extent as the company had seen the person tested in various opportunities and roles. The Aditya Birla Group, which in April reshuffled its top management of various businesses in the group, believes the group has enough requisite internal talent to take up leadership position. According to the company?s website, for Sanrupt Misra, CEO of carbon black business and director-group HR of Aditya Birla Group, leadership development in a high growth organisation is one of the challenges the company is facing today.