Getting Succession Planning Right

March 22, 2016 – Charlie Francis


Click here to see a list of all editions of the From the Desk of the Finance Director column.

March 22, 2016

Read on to hear a succession planning story, and gain key takeaways for your organization.

Small to middle-size cities face many barriers to succession planning. To name a few, they grapple with insufficient staffing, preoccupation with short-term activities, a lack of funding and executive support, restrictive merit system rules on hiring, insufficient marketing efforts, lack of confidence in planning techniques, and resistance to change.

Years of having to do more with less, combined with technology productivity improvements, resulted in flat organizational hierarchies with no middle management. Finally, the Great Recession decimated the bench-strength of local government finance professionals. It took 13 months for my City to find a new Finance Director. I worked for 6 of them; an interim served for the remaining 7 months. Job shadowing wasn’t an option because of tight budget constraints and time limitations for both incoming and outgoing incumbents.

I should have started my own succession planning earlier.

My monthly strategy meeting with the City Manager began with this:

“Charlie, our next priority is to work on the three-legged stool of infrastructure investment, economic development, and community planning for the sinking waterfront district. I heard you loud and clear during budget development when you recommended addressing this to cement the last building block of our long-term goal of fiscal resiliency. Let’s talk about a project plan that I want you to develop and manage for the next two years to get us there.”

My mind was not on the waterfront district though. You see, the moment of truth had come! This meeting had to focus on the touchy subject that he had been avoiding, and did not want to discuss – my retirement plans. I needed to tell him now that I was planning to step down as CFO. If I didn’t address this, I would have been constrained to working for another two years.

“I’ll help develop the plan,” I replied, “but first we need to start focusing on a mechanism to transfer my institutional knowledge to a successor – I plan on retiring in six months.”

I began my knowledge transfer plan by creating a virtual central repository of key financial, performance and economic information. This repository was online, and on-demand. It had to be accessible to a wide audience, but some parts needed to be locked down for confidential information only to be shared with those with a ‘need to know.’

Putting proper data visualization tools in place was critical not only for ease of navigation, but also for spotting clusters, outliers, trend deviations, and other anomalies resulting from subjecting data to digital analysis. I had to give my successor the tools to learn quickly, and data visualization was the best route. The general ledger financial information had to be constrained to the City’s unique chart of accounts; yet flexible enough to portray GASB 34 and GASB 68 schedules.

I also virtually centralized auditor workpapers to answer the critical accounting question “how did he do that last year?” Storyboards, checklists, information exchanges, and job aids all added to storytelling. This created a community where myself, the interim finance director, and the new incumbent could gather together virtually to share information and engage in creative problem solving. These strategies enhanced the transfer of institutional knowledge that enabled a smoother transition from the old guard, to the new.

After a long search, we finally found my replacement. My successor is working on the plans for the sinking waterfront district; but by paying attention to and dealing with the tough subject of strategizing for knowledge transfer, my City’s finances aren’t in danger of descending into a sea of red ink.

Some key knowledge transfer takeaways from my story for my readers:

  • Acknowledge now when you are considering retirement. As indicated above, the City Manager was under the impression that I would be working for a few more years. We hadn’t yet discussed the actual date, and it surprised him when I announced only six more months ahead. This was my fault! Yes, he had been avoiding the conversation, but perhaps so was I. Even if your retirement is a yet few years off and a firm time is not in place, recognize that it will take place and create the awareness that generally this is the time you are considering.
  • Start planning for knowledge transfer. Because of all the competing priorities, this is the easiest to procrastinate. Here’s a helpful aid. Ask a Public Administration student with an emphasis on HR management from a nearby university to help you develop the plan.
  • Storytelling. You will be amazed on the efficacy of transferring explicit and implicit institutional knowledge through storytelling. A story is a description of what happened. When others hear the inside scoop of “what really happened” they tend to remember and inculcate lessons learned better than they would have in a more structured manner. You might even want to create a citywide “Ted Talks” once a month where the retiring senior leadership gathers the city staff and tells them old stories – passing the baton from one generation to the next.
  • Mentoring. This may sound cliche, but I am not speaking of it in the traditional sense. Many finance organization don’t have the bench strength to find someone to mentor. Instead, while you are attending your annual GFOA conference, ask around, seek out, and find emerging leaders who you think would be a good fit in your city, and be a respectable successor. Ask them if they would be interested in exploring over the next few months how to grow into the Finance Director role. They may or may not be your successor, but you will be passing valuable knowledge to a future leader who will contribute to government finance in a more powerful way.
  • Create the central repository of financial information. Remember your first days as a finance director? Recall how much time you spent getting the data together to help you make more informed decisions. Make sure your historical CAFRs, budgets and budget support documents, audit workpapers, process documents and reconciliations are in a central and easily accessible place to provide your successor quick access to the basic accounting question “how was this done last year?”
  • Make yourself available post-retirement with other post-retirement Finance Directors creating a community or network of practitioners. Find a mechanism to either be put on retainer, or to be available onsite by-the-hour for your successor. Hold one-on-one phone conferences, online network chats, or even video-conferences to give advice, answer questions, or point your successor to file folders. In addition, hold frequent information exchanges at chapter and statewide meetings and conferences where you are available to dispense wisdom to less experienced financial managers.


Charlie Francis is a municipal finance expert. He has more than forty years of local government financial management experience in both the public and private sector, including twenty years of experience as a Chief Financial Officer. Most recently, he served as the Director of Administrative Services and Treasurer for the City of Sausalito where he earned the unofficial title of “OpenGov super user”.  He has also served as a finance manager for the Town of Colma, CA and as CFO and acting City Manager for the Cities of Indian Wells, CA and Tracy, CA.

Questions or comments? Email Charlie at cfrancis@opengov.com.

Category: Government Finance