How to Sell Succession Planning to Your CEO

4 things HR leaders can learn from an insurance salesman about how to sell the concept.

I’ve interviewed more than 50 executives from nearly 50 different companies in an effort to discover what has worked for them and what hasn’t in their efforts to grow their bench strength from within. By far, the No. 1 problem with succession planning is that many senior executives view it as a project they can delegate to HR so they can focus on “the real work of the business.” Organizations with executives who view succession planning this way will never produce a sustainable pipeline of talent and will be fighting the war for talent for the next 15 years against other organizations that also fail to appropriately prioritize succession planning.

For succession planning to work, leadership development needs to be a top priority and an integral part of the organization’s culture. This can only be accomplished when the culture change is led by the CEO and executive team. An HR executive from a municipality I interviewed put it this way:

“There are two levels of executive buy-in. The first level is where executives understand intellectually that succession is a top priority. The second level is where they are willing to make the changes necessary to make it work.”

Getting to the second level of executive buy-in means executives must be intrinsically motivated to do the work related to succession planning. That doesn’t come from a PowerPoint presentation by HR on the importance of succession planning. The decision to move forward with succession planning must be the CEO’s idea.

What HR Can Learn from an Insurance Salesman

Investing in the time and energy to develop a succession plan that works is not unlike buying a life insurance policy. Both help reduce your risk of an unplanned departure and, in both cases, you don’t need it until you need it (cue laughter). So if these are similar solutions to similar problems, perhaps you can apply some of the same tactics to sell them.

My father is a financial broker and sells life insurance as part of the estate planning services he provides his clients. When I asked him how he convinces his clients to buy life insurance, this is what he said:

“You first have to help the client identify a problem. In the case of the client I just worked with today, I mentioned that when he dies, it will trigger a huge tax liability for his estate. My client about fell off his chair when I showed him the number: $550,000. The next step is to help him identify what he would like to have happen. Obviously, he can’t prevent himself from dying, but he’d like to prevent his estate from getting dinged by the tax man. So then I explain that there is nothing he can do about the taxes—the government is going to get the money. But then I tell him that there is a way we can prevent that money from coming out of his estate. At this point, he leans in to hear what I have to say. That’s when I tell him about the solution. If he invests a small amount of money now in a universal life policy (life insurance policy where you pay up front instead of in payments) with a payout of $550,000 (the same amount he will owe in taxes), then he’s paying a little money now to save a lot of money down the road.”

Here are a few things HR leaders can learn from an insurance salesman about how to sell a concept:

  1. Help the client identify the problem. In the life insurance scenario, the problem is a huge tax liability upon death. In the case of succession planning, the problem is unplanned departure of people in key positions, and the difficulty and expense involved in recruiting for those positions. And let’s be clear—in succession planning, the client is the CEO or top executive. If they don’t see the problem, then go no further. You will only frustrate them and hurt your own credibility if you provide a solution to a problem they don’t believe exists.
  2. What would they like to have happen? The broker’s client wanted to prevent the loss of such a large portion of his estate due to the tax liability. That’s not going to happen, but there is a way to replace the tax liability that will come out of his estate. In succession planning, the CEO would like all of his or her key staff to stay put indefinitely. That’s not going to happen, but there is a way to prevent the fallout when they do leave. It’s called succession planning.
  3. Provide a solution. Compared to succession planning, an insurance policy is an easy solution that requires only a little explanation. So you’ll need to take a different approach with selling succession planning. Instead of saying, “Here’s what to do and this is how you do it,” you should only provide high-level information about succession planning at first, and then go on the journey with the CEO to discover the details together. Why? Because maybe the CEO or other executives who need to buy in to succession planning have some concerns and would like it done a certain way to assuage those concerns. And that’s what you want! You want this to be the executive team’s plan, not HR’s plan.
  4. Don’t tell, ask. Did you notice that the insurance salesperson didn’t drag his client in for a meeting to tell them why they should purchase an insurance policy? Instead, he provided the client with the ugly facts, and asked the client what they would like to have happen. That conversation also happened to take place in a meeting about a different, but related topic (estate planning). It’s not an effective salesperson who says “I’d like to meet with you to tell you why you need life insurance.” For the most part, that is essentially how HR has been trying to sell succession planning to the organizations they work for. HR has been using bad sales tactics to sell their service offerings!

Michael Timms is a management consultant, author, and speaker specializing in succession planning and leadership development. He is also the founder and principal of Avail Leadership. His most recent book, “Succession Planning That Works,” is available for purchase on Amazon and other online booksellers. 


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