Determining if an internal candidate is suitable to replace the President and CEO of Stonewall Industries is a process that should not be taken lightly. There are five executive level candidates from different departments that possess different skills and experiences.
There are a few steps to outline before making a decision on whether an internal candidate will be suitable. The first step in deciding if an internal candidate was appropriate for replacing the President and CEO of Stonewall Industries is to conduct an inventory of heir apparents. This inventory would outline basic information on each candidate’s position at Stonewall Industries, as well as any other experience they may have had in previous positions. The inventory would also evaluate any relevant education, training, and years of service at Stonewall industries. This first step is very general, but will help to outline which level of experience the successful candidate must have in order to be the head of the company. After an inventory has been conducted, those candidates that have been pooled will be evaluated on their promotability to CEO, as well as potential to be CEO. This can also be described as a management inventory. This way, our group of consultants can outline Stonewall Industries’ strengths and weaknesses, and be able to plan training and development in anticipation of Jim Pender’s retirement. Next the group of candidates will be allocated into a succession planning rating system. This will outline the level the employee’s readiness to perform at a President’s level, well as their current performance in their VP positions. In relation to the case study, all five candidates are ready now or within one year, since they are all in currently in VP positions. Since the retirement of Jim Pender will take within one year, all five candidates will receive a rating of (B) for readiness, since they are all at an equal level. However, in the case study, it is outlined that the five candidates are not at the same level of performance. McBain and Khan are all viewed as competent and receive a rating of (3), while Byer and Ho are viewed as exceptional, and receive a rating of (1). Since Byer and Ho do not have direct line management experience, they will be placed into special assignment and action learning activities (as outlined in question 4) for an assessment of future promotability. After the succession management program has effectively taken place, the internal candidates will be reassessed on their level of readiness and performance, and the selection process will begin to take place. It is important to note that external hiring of Jim Pender is also an option. Stonewall Industries could recruit a candidate in an executive level, whom has extensive knowledge and training in direct line management experience, as well as experience in running a whole company. However, this process could be very lengthly and expensive. Since Jim Pender is retiring within this calendar year after forty years of service, there simply may not be enough time or resources to recruit, train and hire an external candidate. Not to mention, to replace a President/CEO who has served the company after forty years with a brand new employee may decrease staff moral and effect business processes. While an external candidate may implement fresh perpectives and experiences, the internal candidates are all regarded as competent and trainable to perform at the CEO level. Our group of consultants would need to perform a cost/benefit analysis to determine if hiring an external employee would be affordable for Stonewall Industries. It is important to note that to attract and recruit an external candidate at a senior executive level could be very expensive in terms of salary for the company. By utilizing the succession management plan as outlined in question 4, Stonewall Industries will be able to save time and resources by beginning training immediately, instead of hiring an external candidate, and having to get them up to speed on the company as a whole, and its entire business processes. By selecting an internal candidate to replace Jim Pender of President and CEO of Stonewall Industries, the organization will be able to perceive a “promote from within” policy. This will not only increase employee moral at the executive VP level, but also for staff at all levels, a ripple effect will take place and other positions will need to be replaced when an internal candidate is selected. This will encourage employees that they are valued at their company, and their potential is recognized to move into a higher level of employment with the organization, perhaps even the potential to make it to the level of the head of the company. When employees are valued, their moral is driven. When employees work for a company that they plan to work for in the long-term, their production is increased and the business will continue to flourish while the company’s leader is replaced.