Independent Banker - November 2020 - 55

Kaplan likes to see a bank dig two
or three levels into upper and middle
management to identify employees
with high potential, particularly
going deeper as the bank grows.
Smart community banks will take
steps to help maximize their talent
and get them ready for their future
roles internally.
" Grow your people. Always let
that be your first option, " Kaplan
says. " The more you can do on your
own internally, the more long-term
the successors, the better off and
smoother transitions will be. "
Don't forget to plan for temporary
absences like the one experienced
with Dimon at JPMorgan. While
CEOs in many industries have
contracted COVID-19, few have died.
Instead, many found themselves ill
and unable to work at full capacity
for an extended period of time. These
interim and emergency plans need
to be updated. " Ask yourself, 'What
would we do if we have half a CEO
for three months?' " Kaplan says.
Johnson suggests identifying
current team members who can
assume higher roles of responsibility
for extended period of time or
implementing strategic partnerships
to outsource functions.
FIND THE RIGHT SUCCESSOR
FOR YOUR BANK
While the COVID-19 pandemic was
unexpected, the reality of a crisis
shouldn't be.
The banking industry is good for
a crisis every decade or so, making
it essential that management has
the ability to adapt during a crisis,
Tuck says. That makes the current
pandemic an opportunity to actively
observe the community bank's best
performers and see how they handle
challenges like problem loans or
employee issues.
" People's true character and
abilities show in times of crisis, "
he says. " It's a great opportunity to
look at somebody new or that is the
THE PATH TO CHOOSING
AN EMERGENCY SUCCESSOR
When a crisis hits and takes a leader out of
commission, someone has to take their place until a
permanent replacement can be found. This shouldn't
be a game-time decision. The board's succession
plan should include an emergency interim successor
who can serve six to 12 months in their place while
evaluating longer-term leadership options.
Alan Kaplan, founder and CEO of Kaplan Partners,
an executive search and succession planning firm in
Wynnewood, Pa., offers these four approaches for
choosing a short-term successor.
1. Promote the planned successor early
If someone at the community bank has already been
identified as the successor, put that person in the
role. It gives the board a chance to evaluate their
performance in that role before making a long-term
commitment. " I have seen situations where the heir
apparent being groomed was elevated earlier than
expected and did a spectacular job, " Kaplan says.
2. Bring back a retired executive
Faced with a sudden departure, Kaplan recalls a
$1 billion-asset community bank that asked its former
CEO, who had retired two years earlier and left the
board a year before, to return on an interim basis.
The CEO made it clear he was not interested in a
long-term gig. Kaplan says this solution worked only
because the CEO hadn't been out of the banking
world for very long. If a succession plan involves
bringing back a retired employee, make sure that
employee is still capable of doing the job when you
reevaluate the plan each year. You don't want to call
someone up to the majors only to find out they've
long since left the game.
3. Promote another high-performing executive
If you have a chief financial officer or another
executive that really shines, having them fill in as
temporary president or CEO gives you a chance to
audition them for the role. You can then decide to give
them the job or choose to hire outside.
4. Hire a temporary executive
While they aren't common in the community banking
industry, it's possible to hire a temporary CEO. These
are typically turnaround experts who work with
struggling institutions.
independentbanker.org Q 53
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Independent Banker - November 2020

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