Succession planning *IS* strategic planning

In 2018, I facilitated approximately 20 credit union planning sessions in my role as a League President. I likely learned as much in those planning sessions as I taught others. The biggest lesson was that credit unions were not being particularly strategic about their people operations. In most instances, human resources offered a very quiet voice at the table (if it was represented at all), primarily there to discuss HR as a risk factor (i.e., the anticipated increase in health insurance costs). While credit unions stated that their people were their differentiator, this was not reflected in most credit union strategy. People operations was not considered with the same attention as lending, technology, or financial operations. The lessons I learned were profound enough to drive me to career change. Today, I consult with dozens of credit unions across the country in developing a more inclusive approach to people operations.

People operations. Has the term entered your organizational lexicon yet? I use it to distinguish the difference between the human resources mindset that shaped my early career (and my formal education) compared to the reality that is needed in today’s workplace. Early on, Human Resources became a critical part of a company for its role in protecting the company… from its employees. HR ensured that employees followed policies and that the company’s risk of being sued by an employee was low. Then, companies began to embrace the idea of Human Capital, shaped by the outlook that people are a company’s greatest asset, and we should care for them as such. Let people wear flip flops to work! Offer gourmet coffee in the break room! Set up a ping-pong table or a gym on premises! Try to make employees happy so they will be loyal and may even choose to spend more time at work. Happiness does not equal engagement, though, and another shift toward People Operations became critical. Rather than trying to get the most out of employees, an emphasis on People Operations looks at how to optimize the people in the organization. This is not by treating them as capital or assets but recognizing their humanness and that they belong in a system that extends far beyond the walls of our organizations (with those factors significantly impacting how they operate).

As financial institutions, we are likely to look at other areas of our organizations with this systemic consideration: When we want to maximize our core, we partner with outside vendors to understand how it is used compared to what it is capable of. Our lending operations are examined through a variety of lenses (economic, technological) as we look at product development and delivery. Somehow though, with people, we have been less likely to look at them holistically. We consider how well they contribute in their current role, with minimal regard to understanding the context in which they are operating. What could we do to optimize their performance? What kind of support do they need to perform at their greatest capacity? Are there elements of their potential (or obstacles in their way) that we do not see from our corner office view?

In the same way that we expect tomorrow’s technology to help us work more efficiently, future lending to be inclusive of more members, and marketing to reach wider populations more effectively, our organizations should expect improvement in our people, as well. Tomorrow’s executives will have better tools than today’s, both from the technology available to them as well as in the human skills that have been incorporated into so much of their early development. If you are skeptical, spend some time studying the curriculum of today’s elementary schools compared to what you studied. Critical thinking, growth mindset, and emotional intelligence are core, while memorization and regurgitation are less important. Younger generations—who are already entering the workforce in record numbers– are being taught how to think (not what to think) and it is shaping their relationship to work. It will continue to change the way we are able to operate. As today’s leaders, we have a beautiful opportunity to plan for a future that optimizes these talents as we look forward strategically and far beyond the C-Suite.

Succession planning through a People Operations lens can differentiate your credit union by going deeper. It may involve consideration of the humans you employ and what might be impacting their career-related decisions. It should excite and energize your employees, giving emerging leaders an opportunity to see themselves in the future of the company—to design the future of the company– and it should recognize there is both visible and latent talent in the organization that may be cultivated, developed, and optimized in order to advance the organization. Strategic succession planning must also include an environmental scan that builds understanding of the threats your workforce might be facing: Will a childcare shortage cause promising young professionals to modify how much they work if they want to raise a family? Will a booming economy and more robust 401Ks draw more seasoned professionals into early retirement? Are you considering how these factors might impact your People Operations with the same weight you would consider how a strike at your SEG might impact your lending or how a data breach at a major vendor might impact your information security? How are you anticipating and preparing for these threats, and possibly even turning these potential threats into strategic advantages for you as an employer?

As you prepare the next iteration of your strategic plan, consider how to incorporate People Operations and longer-term succession planning into your overall growth goals. Succession planning is strategic planning and it will position your credit union for long-term success.