While tech fluency is important, it’s not the only skill set that determines success. Having such a hard-and-fast rule for past experience can be costly.8 The pool of candidates, by definition, becomes far smaller; what’s more, based on the struggles of many new CIOs, it’s clear that the resulting candidates haven’t proven that past experience is any indication of future performance.
Consider that CIOs are averaging just over four years on the job, among the shortest tenures in the C-suite, with briefer stays in role on the rise.9 Given the sheer pace of technology disruption that can emerge within that span of time, not to mention the competition for talent at all levels, organizations are at a disadvantage if they limit the kinds of candidates they consider to those with a predetermined list of demonstrated capabilities. Another flaw in a skills-based approach to succession is that it may be one-dimensional. Potential candidates do better when they have a broad exposure to other parts of the business, says Summer Houchens, associate vice president, Information and Digital Solutions at Eli Lilly and Company. Such rotations for potential IT leaders help them become well-rounded and operationally literate.
“Early on, I was given opportunities alongside my finance and marketing counterparts,” Houchens says. “I also had a mentor who worked with me on my communication skills. As we think about succession planning in IT, think about the training necessary for leaders to help them grow.”
A critical challenge facing any organization seeking candidates for leadership is context: There are many scenarios that can precede such a leadership change, and the candidates must match the expectations. In today’s environment, where the future of many organizations depends on technology, CIOs are expected to drive transformation, but are not always prepared to deliver results as fast as expected. An analysis of CEO succession at 200 organizations over 15 years found that insiders typically don’t change a company’s trajectory.
This complexity is apparent among CIOs, too. After synthesizing data from more than 200 CIO Transition Labs organized by Deloitte, internal candidates (64%) were almost twice as likely as external hires (36%) to be selected for the CIO role. But when a former CIO was demoted, asked to resign, or the CIO position did not previously exist, companies preferred external candidates by a two-to-one margin.10
“It’s not always cut-and-dried as to whether the team you have in place has the capability to step up,” says Laura Miller, CIO at Macy’s. “There are times when you have to move really fast. And when you have to do so, sometimes you have to bring in outside talent. But I think it’s got to be a combination of internal and external talent when you’re in a big transformation.”
Grappling with gravity: How people pose the biggest barriers
As much as organizations struggle with a skills-based approach to succession planning, the biggest hurdle appears to be in how future leaders are evaluated on an interpersonal level. Many organizations pay too little attention to leadership development as a person-to-person endeavor. One basic and incorrect assumption is that incoming executives don’t need much help from current leaders. Typically, candidates are asked if they are ready for a new challenge, when they should be asked how they want to be prepared for new responsibilities.11
In addition, incumbents often fail to see the value in actively participating in succession activities, viewing the process as a threat to their own standing.12
Larry Quinlan, retired Deloitte Global chief information officer, suggests that this can be overcome with a reframing of the issue for incumbents—instead of feeling threatened by succession planning, they should feel empowered as part of their legacy-setting process.
“You shouldn’t look at the organization and say clearly, there isn’t a single person who can do any part of this job and we must automatically look outside,” Quinlan says. “I look at succession in the broadest possible way: to ensure that I get my say in who could be a successor today, or tomorrow.”
To help ensure that the net is cast wider, Deloitte’s Advisory and Consulting practices have built a succession management tool that facilitates a more efficient, secure, and advanced process while enabling leaders to address bias in selecting a successor. The process prioritizes developing a diverse, inclusive, and high-performing pipeline, and deploying leaders against their highest and best use in client leadership roles. By providing a real-time view of attributes along with historical succession data, the tool provides additional views of the candidate pool and past succession decisions that may have otherwise been missed, as well as insights into the pipeline of next-generation successors to target for development. With an abundance of data and thousands of potential candidates for each leadership role, a one-stop-shop for pulling broad candidate lists has helped Deloitte to build a robust and holistic succession-planning process that balances technology and data with the offline, personal side of the equation.
As incumbents make plans to depart, up-and-coming leaders should in turn look for ways to fill the void. The onus is on successors to make the move: Lilly’s Houchens views each opportunity in which a leader steps aside as a chance to hone executive and mentorship skills.
“Step into those leadership gaps,” advises Houchens. “The person may have been someone you relied on and others relied on; what gaps have they left that you can step into, and see what you can do for others. Become a mentor for someone else. That mentor you’ve relied on has been greatly important to you and others, so use it as an opportunity to cultivate new relationships, explore new opportunities, and give back.”
Locating new talent on the radar
Bolstering leadership ranks with diverse candidates is one of the most persistent challenges in the technology sphere. For instance, gender diversity ranks high as a priority for technology executives, and there’s a business case for it, as the presence of women in leadership often correlates to stronger financial performance, healthier team dynamics, and higher productivity.13 But a “leaky pipeline,” starting in the education system, results in a decreasing share of women ascending to senior leadership roles.14
Although there’s broad agreement in the IT workforce that DEI is a strategic imperative, workers from different backgrounds and experiences hold vastly different views on the progress of their organizations against these goals. For one, there’s disagreement on the expected time horizon required for achieving gender parity. In Deloitte’s 2021 survey of DEI issues in technology, women and non-white workers were less likely to believe that gender parity already exists within their current technology function. In addition, men were 1.5 times as likely as women to view themselves as “tech-fluent,” while 97% men and just 78% of women viewed themselves as a “technologist” (figure 3).