The Urgency of Succession Planning in Public Agencies

The Urgency of Succession Planning in Public Agencies

Caitlyn Alford is a first-generation college graduate of the University of North Carolina at Chapel Hill with a Bachelor of Science in Psychology and a minor in Neuroscience. She earned her M.A. in Industrial-Organizational Psychology at Meredith College in Raleigh, North Carolina. Since 2019, Caitlyn has been leveraging her expertise as a manager and talent management consultant at Catching Leadership, where she specializes in organizational change, leadership development, visual creativity, and promoting mindfulness in the workplace. Her dedication to fostering growth and innovation within organizations allows her to help clients navigate today’s ever-evolving business landscape.

Michael Leytem has been a leadership coach and talent management consultant since 2011. He has worked with thousands of organizational leaders to customize talent strategies and leadership solutions that drive personal and organizational growth. As a published academic, with an M.A. in Industrial-Organizational Psychology, Michael has studied the mental processes and social pressures that influence effective leadership. His life-long passion for leadership, psychology, and mindfulness transcends throughout his work and interactions with others. Michael brings over 13 years of leadership coaching and management consulting experience to the corporate events he hosts.

The public sector is at a crossroads. With a wave of retirements looming, agencies face the challenge of preparing for the next generation of leaders. Unlike the private sector, public agencies operate within unique constraints from budget limitations to complex bureaucratic procedures, and high levels of public scrutiny. These challenges make succession planning not just a nice-to-have initiative but an essential strategy for ensuring continuity in public agencies.

What is Succession Planning?

According to the Society of Industrial-Organizational Psychology (SIOP), succession planning is a process used to create and manage an organization’s talent pipeline. Succession planning often includes:

Identifying the key positions in an organization and the competencies and experience criteria they require.
Cultivating a pipeline of high-potential talent from which to select new leadership.
Understanding the competencies and skills currently available within the organization.

It is important to note that succession planning is NOT replacement hiring. When some professionals use the term “succession planning,” they are mistakenly referring to replacement hiring. Replacement hiring is the process of selecting or hiring a replacement without any long-term talent development to support the process.

5 Myths About Succession Planning

In addition to the confusion between replacement hiring and succession planning, there are a few other misconceptions about the nature of succession planning (Sigma Assessment Systems, 2023):

Succession planning is just for CEOs.
Succession planning is just for people who are retiring.
Succession planning is HR’s job.
Succession planning is not necessary for flat organizations.
Succession planning is irrelevant for family firms.

The Current State of Succession Planning in the Public Sector

Survey results on organizational succession planning among public agencies revealed that 12% have a process, 20% are developing one, 35% plan to within five years, 15% won’t develop one within that timeframe, and 17% are unsure. Conducted by MissionSquare Research Institute; sample size: 294.

Succession planning in the public sector is, at best, inconsistent. While many agencies recognize its importance, few have implemented formal processes to address leadership continuity. According to a recent survey by the MissionSquare Research Institute, only 12% of public sector HR managers report having a well-defined succession planning process in place—a modest 1% increase since 2016. Meanwhile, 35% of agencies intend to develop such a process within the next five years, but progress remains slow.

Compounding the issue is the disconnect between long-term talent development and day-to-day operational demands. Public sector leaders often cite a lack of internal expertise, resources, and buy-in as barriers to implementing robust succession planning strategies (MissionSquare Research Institute, 2016). As a result, agencies risk being caught unprepared when needing to fill critical positions.

A Ticking Clock: Anticipated Public Sector Retirements

Over the past four years, public employers experienced a notable decline in staffing, which mirrored the overall workforce trend. While private sector employment bounced back by April 2022, state government jobs didn’t return to pre-pandemic levels until January 2023, and local government employment reached that point by December 2023 (MissionSquare Research Institute, 2024).

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The MissionSquare Research Institute (2024) reports that 54% of HR managers surveyed anticipate the largest number of potential retirements over the next few years. 52% feel their employees are financially prepared for retirement. This is the first time in years that the number of people responding “yes” outnumbered those who responded “no” indicating that an avalanche of retirements may be coming. In addition to exits, Gen Z will make up about 30% of the U.S. workforce by 2030 according to The U.S. Bureau of Labor Statistics (2024). This past year was identified as the peak year that baby boomers will be turning 65, implying that if they have not yet retired, it will likely be coming soon.

Despite these signs, replacement hiring seems to be on the rise while succession planning efforts within the public sector seem to have stalled (MissionSquare Research Institute, 2024):

Only 12% of agencies have a formal succession planning process, and just over a third (35%) aim to develop one within five years.
Meanwhile, 47% of agencies have resorted to hiring temporary or contract employees, and 37% have rehired retired staff to fill gaps.

A person in a suit sits at a table, hands forming a protective dome over wooden cutouts of people, symbolizing management's role in safeguarding and caring for a community.

A group of people seated around a table in a modern office, attentively listening to a man discussing key management strategies. A whiteboard with notes is in the background. The setting is casual yet professional, with natural light streaming through large windows.

Unlike the private sector, public agencies operate within unique constraints from budget limitations to complex bureaucratic procedures.

CAITLYN ALFORD & MICHAEL LEYTEM

Employers are now in the eye of the storm and the need for proactive succession planning has never been greater. Public agencies must move beyond stopgap measures and invest in the proper infrastructure in order to build greater bench strength and prevent unnecessary hardships.

“One of the things we often miss in succession planning is that it should be gradual and thoughtful, with lots of sharing of information and knowledge and perspective, so that it’s almost a non-event when it happens.” – Anne M. Mulcahy, Former CEO of Xerox

4 Components of Successful Succession Planning

Strategy → A well-defined strategy aligns succession planning with organizational goals and ensures leadership continuity. Lack of strategy leads to talent gaps, decreased morale, and operational disruptions. About 70% of succession plans fail within two years due to lack of support (Forbes, 2024). Ensure alignment between leadership and stakeholders to gain buy-in, and communicate the importance of succession planning to foster organizational commitment. A part of your strategy should include identifying critical roles, analyzing role requirements, and forecasting future needs. Agencies will also need to decide how much of the succession planning process will be shared with employees. Lastly, don’t forget to manage role transitions– always have a succession plan for the successor’s existing role to prevent the “domino effect.”

Measurement → Consciously decide on the criteria you want to use for succession planning in your agency– common ones include performance, potential, and readiness for role. A best practice for objectively measuring performance includes a competency-based approach with a combination of core and technical competencies. Performance expectations should be tailored to specific roles and validated by subject-matter experts. When measuring potential, define what potential means within your agency and the ways you will objectively track it. When measuring readiness, define clear cutoffs based on developmental gaps (ready now, ready in 1-2 years, ready in 3+ years, etc.) Don’t forget to consider the employee’s desire for the role. Even if they are a great fit, they must be motivated to take on greater responsibilities. There are a lot of tools you can use to aid your decision-making process (i.e. 9-box, 4-box, decision tree, talent pools, etc.), so make sure you select one that will work for your agency. There is controversy over which tools are the “gold standard” for mapping talent; but remember this: the tool you use to map talent is just a vehicle to foster better talent conversations. A convertible, bike, or train can all get you where you want to go, so select the method that makes the most sense for your agency. If you’ve nailed down your criteria and are measuring your talent objectively, the tool can be thought of as the dashboard, not the engine that mobilizes the car.

Development → Effective employee development creates a pipeline of talent ready to step into critical roles. More than 74% of leaders report they are unprepared and lack the training for the challenges they face in their roles (McKinsey, 2018). To mitigate the risk, create individualized development plans tailored to future role requirements. Consider using simulation-based assessments and training to proactively identify skill gaps for future roles. Think of simulation-based experiences as flight simulators for leaders — safe spaces to test, refine, and elevate skills before piloting a larger aircraft or elevated role.

Ongoing Evaluation → Succession planning needs to evolve with your agency; this requires ongoing monitoring of its effectiveness to stay relevant in an ever-changing workplace. At a minimum, review the process annually and be open to feedback to make it better. Decide what success metrics your agency should track (i.e. percentage of critical roles that have a succession plan, average number of successors per critical role, average years until successors are ready, etc.) and use these metrics to inform any necessary changes to your succession planning strategy.

Invest in High-Potential Employees

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Public sector agencies often struggle to find qualified external candidates. In fact, 48% of HR managers report having to reopen recruitment due to insufficient applicants (MissionSquare Research Institute, 2024). This difficulty in finding qualified candidates demonstrates an opportunity for agencies to hone in on developing their talent from within. It may be easier to develop talent in-house for future roles than hoping you find a unicorn in a competitive labor market.

Organizations should balance their spending by investing more in high-potential employees and emerging leaders at entry and mid-levels to strengthen the leadership pipeline. For agencies looking to take action, Catching Leadership offers two pathways to support your succession planning efforts:

Consulting Support for Succession Planning: Whether you’re just starting your succession planning journey or looking to enhance existing efforts, we can help you validate competencies, create objective performance and potential criteria, and tailor individual development plans to match your agency’s unique needs. Book a Call with Catching Leadership.

New Leaders Program (NLP): If you already have an effective succession plan in place but are seeking affordable ways to strengthen your leadership pipeline, the NLP provides a tailored solution for developing emerging public-sector leaders in California. This program is designed to:

Train new/mid-level public-sector leaders on a variety of leadership topics.
Accelerate growth and improve bench strength at lower levels within agencies.
Help leaders develop sustainable habits that promote a culture of well-being.
Offer affordable and convenient support for your leaders.

*Attendees will receive a 1:1 coaching session as part of the program. Explore Catching Leadership’s NLP.

Final Thoughts

The wave of retirements in the public sector is inevitable, but its impact doesn’t have to be. By focusing on strategy, measurement, development, and ongoing evaluation, agencies can create a robust succession plan that ensures leadership continuity and organizational resilience. Don’t wait for the storm to hit– start planning today!