Q&A: The ROI of Leadership and Succession Planning with Nishita Ann Matthew

Q: How did you end up in the field of HR, and what is your professional background, including your years of experience and current workplace?

I got into HR somewhat accidentally through an internship that could lead to a permanent position after six months if I performed well. Initially, I was drawn to talent acquisition and worked with various startups, gaining nearly five years of experience in on-site and in-house recruitment. After two years in talent acquisition, I realized HR was a broad field and decided to pursue a master's degree while working to gain more knowledge and leadership skills. I then joined a product-based startup called Turbolab, where I built the HR team from scratch, growing the company from 50 to around 150 employees in about 1.5 to 2 years. Currently, I'm working at a marketing agency called Catalys, a remote organization that I joined a month ago. So far, my HR journey has been fulfilling and successful.

Q: What is your mindset, and what specific qualities or attributes do you prioritize when hiring for roles in extremely early-stage startups, mid-stage startups, and enterprise-level organizations?

In the context of hiring for extremely early-stage startups, the focus is often on individuals with a founder's mindset and a willingness to take risks. HR involvement typically comes after the initial core team is in place, assessing candidates based on their alignment with the company's vision and their risk-taking attitude.

For mid-stage startups (around 50 to 150 employees), the hiring process becomes more structured, with HR conducting practical assessments and cultural fit evaluations to ensure the company's vision is preserved as it grows.

In enterprise-level organizations, there are multiple interview stages, including technical assessments and tests to identify candidates who stand out from the large applicant pool. It's less about technical skills and more about agility and adaptability to handle different roles within the company.

Q: What is succession planning, and how does it remain relevant in today's world?

Succession planning, in its essence, is a proactive, long-term strategy aimed at ensuring an organization has a reliable pipeline of leaders or capable individuals in place when needed. This planning extends beyond the C-suite level, especially in larger organizations. As a company grows, it becomes essential to have plans in place for leaders at all levels. This comprehensive approach acknowledges that leadership has a trickle-down effect and that the departure of leaders, even at lower levels, can have a significant impact. By proactively addressing potential leadership gaps, succession planning helps organizations avoid reactive, panic-driven responses to critical departures and ensure smooth transitions. This strategic foresight is particularly relevant today, given the uncertainties posed by events like the pandemic and the "great resignation" wave, where employees may leave for various reasons, making succession planning an indispensable tool for organizational stability and growth.

Q: How do you handle a situation where a leader with a critical skill set leaves the organization for unforeseen reasons and the replacement has similar skills but doesn't align with the organizational culture? How does succession planning factor into addressing this challenge?

In a scenario where a leader with critical skills departs and their replacement lacks cultural alignment, it's essential to involve all managers in the organization. Start by communicating transparently about the change and the reasons behind bringing the new leader on board. While there might be cultural differences or other issues, there should be numerous positive factors that led to the new hire's selection. Encourage interaction between the new leader and managers before implementing changes to reduce resistance. The board should also explain the departure of the previous leader, providing information that is appropriate for the organization. Transparency from the moment the new leader joins is key to successfully managing this transition and addressing any cultural or leadership challenges.

Q: How do you create a succession plan during chaotic times, and when does it become relevant, considering the organization's age or stage of development?

Succession planning is highly relevant, and its timing depends on the organization's growth stage. 56% of organizations don't have succession plans. In the early stages, especially for small teams of 5 or 6, having a succession plan is relatively easier. Succession planning is crucial because it prepares for potential departures and their impact on the organization.

Here's a structured approach to succession planning:

1. Identify Critical Roles: Begin by identifying roles that would be challenging to replace or could disrupt the organization if vacated.

2. Assess Impact: Determine the internal and external impact of losing individuals in these roles.

3. Internal vs. External Resources: Consider whether you have internal candidates who can step into these roles or if external recruitment will be necessary.

For rapidly growing organizations, it's crucial to implement this three-step structure from the outset. In contrast, organizations with a stable foundation can gradually introduce succession planning, relying on a trickle-down effect from their founding team to pass on knowledge. Succession planning aims to secure critical positions and facilitate knowledge transfer, ensuring a smoother organizational transition.

Q: How do you identify potential leaders among a group of individuals when there are more candidates than available leadership positions in specific departments for succession planning?

To identify potential leaders when there are more candidates than available positions, you should follow a structured approach. Start by building a successor profile for critical roles, listing competencies, and considering backgrounds. Then, assess your current talent pool, with HR or founders directly identifying suitable candidates in smaller organizations or involving managers in larger ones.

Managers perform the first layer of filtering by assessing candidates based on their competencies, multitasking prowess, logical reasoning, and project performance. The next layer involves mentoring and buddy programs with founders or senior team members to invest in potential successors. Categorize candidates into A, B, and C based on their readiness for leadership roles within specific time frames (e.g., 6 months to 5+ years).

It's crucial to ensure diversity and unique skill sets among potential leaders in the pool to address various organizational needs effectively. This structured approach creates a pool of potential successors for future needs, providing a safety net in case of leadership changes or crises.

Q: Can you provide an example of a startup that successfully implemented a succession plan and achieved remarkable success, such as Flipkart in India, and share insights into what they did differently in terms of culture and subsidiaries?

Certainly, when we examine the success and failures of startups in terms of succession planning, Flipkart serves as an excellent example. Flipkart initially hired young engineers who eventually became heads of different departments, contributing to the company's remarkable growth and success. Their approach involved nurturing and promoting talent from within, ensuring a smooth transition.

When Steve Jobs left Apple, the company faced challenges because they hadn't planned for his departure. They appointed John Sculley as an interim CEO during this time. This situation highlights the importance of having a well-prepared board and providing the right training for directors to handle such transitions.

Steve Jobs later returned to Apple and showed how visionary leadership can transform a company. His comeback revitalized Apple and had a profound impact on the company's future.

Slack, a renowned company, is widely recognized for its unwavering dedication to employee growth and advancement within the organization. They make substantial investments in leadership training and comprehensive development initiatives designed to empower their workforce. Another example is Basecamp, a remote company with a diverse talent pool worldwide. They strategically ensure they have backups for every role, akin to a game of chess, enabling them to adapt and grow.

Conversely, even prominent figures like Jeff Bezos had to face challenges in leadership transitions, underscoring the significance of succession planning.

These examples highlight the critical role of succession planning in ensuring organizational stability and long-term success.

Q: How do you distinguish good leaders from smart individuals in succession planning, considering values like a sense of belonging and ownership within the company?

To identify good leaders from smart individuals during succession planning, we initiate a leadership culture within the organization from the start. This involves orientation and structured 1-on-1 meetings, peer reviews, and payout meetings. We focus on competencies such as multitasking, prioritization, motivation, and inspiring skills. We also encourage role models and leaders who can serve as examples, as well as systematic metrics to evaluate leadership qualities in different categories of leaders, like self-leaders, team leaders, and entrepreneurial leaders.

Q: How do you make smart people leaders, and how do we make leaders smarter?

To help individuals who excel at managing processes and timelines transition into effective leaders, we implement cross-functional training programs. We assess their willingness to become leaders and have candid conversations with them about their aspirations. For those who want to be leaders but lack certain leadership skills, we offer personal development programs tailored to their needs. This approach helps them evolve from managers to leaders, provided they are genuinely motivated to take on leadership roles and believe in the organization's vision.

Q: What are the fundamental distinctions between a manager and a leader, particularly when using these terms in sentences to highlight their differences in an organizational context?

The key difference between a manager and a leader is that managers excel at implementing processes and structures, while leaders inspire and motivate others through their vision and the ability to inspire followers. Managers can revamp existing structures, and leaders often have people shadowing them to learn and develop similar leadership qualities.

Q: In domains like engineering, tangible metrics, such as coding efficiency, can help identify leaders, while in domains like HR, where metrics are less quantifiable, how can leaders be recognized based on their core skill set or competencies?

The key intangible qualities for identifying leaders include:

1. Emotional Intelligence: Leaders need to possess emotional intelligence, which involves understanding and differentiating between empathy and sympathy. This quality helps them motivate and inspire others effectively.

2. Anticipation and Proactive Decision-Making: Leaders should have the ability to anticipate both internal and external threats and make proactive decisions based on these forecasts. While data can support this process, the capacity to anticipate and act is an intangible quality.

These qualities are essential for effective leadership but can be challenging to quantify or measure on paper.

Q: If you had to choose between Captain America and Ironman for succession planning as a leader, who would you pick and why?

I would choose Iron Man because of his creativity and ability to think outside the box. He may be a risk, but he has great potential for grooming future leaders who are willing to learn and take on challenges.

Q: Who would you choose as a successor and who as a manager between the smart but arrogant guy who takes on most of the work and the supportive guy who brings out the best in others but lacks motivational skills?

The smart but arrogant person possesses qualities such as intelligence, assertiveness, and a drive to get things done. These traits can make them effective leaders because they are often open to change and can adapt to new circumstances quickly. Their intelligence enables them to grasp complex concepts and make informed decisions, while their assertiveness can help them drive their teams towards achieving goals. However, they may need guidance and support in developing interpersonal skills and empathy to become well-rounded leaders.

On the other hand, the supportive individual, while excellent at bringing out the best in others and maintaining a sense of camaraderie within the team, might tend to rely on their past experiences and be resistant to significant changes. This makes them better suited for a managerial role, where their ability to nurture and guide team members can be valuable. However, they may need to work on embracing change and developing a more proactive approach to leadership to transition into a leadership role successfully.

In summary, both individuals have their strengths and areas for improvement, with the first person being more adaptable and potentially a better fit for a leadership role, while the second person's strengths align well with a managerial position.

Q: Do high- or low-agency individuals have better leadership potential in a startup, and what's the ideal balance between them as a startup grows towards a billion-dollar company like Flipkart?

High-agency individuals have a better chance of becoming leaders in a startup due to their resilience and adaptability, but low-agency people can also have potential if they undergo coaching and mentoring. In terms of the ideal proportion, in the early stages of a startup, a 50/50 balance between high- and low-agency individuals is beneficial. As the organization matures and scales up, the proportion may shift more towards adding more leaders while maintaining a foundation of low-age individuals.