Succession Planning in Mid-Market Firms: Preventing the “Oh No” Moment

By Tony Cinello, Founder – Anthony Andrew

You know the moment I’m talking about.

A key executive resigns. The board starts calling. The CEO turns to HR and asks, “Who do we have ready?”

And there’s silence.

That’s the “Oh No” moment—and if you’re in a $25M to $1.5B company without a formal succession strategy, you’re closer to that moment than you think.

Mid-market companies often lack the layers, redundancy, or internal mobility structures that protect against sudden leadership gaps. But here’s the good news: succession planning doesn’t require enterprise-scale resources—just the discipline to think ahead.

This article outlines how to build a lean, effective succession plan that protects your business, reduces risk, and develops your future leaders with purpose—not panic.

The Vulnerability No One Talks About

A 2023 study by the National Association of Corporate Directors found that only 44% of private company boards feel prepared for an unplanned CEO transition (NACD, 2023). From what I’ve seen, the readiness is even lower for VP, GM, and Director roles—the same roles that hold your culture, operations, and customer relationships together.

In mid-market firms, the risk is amplified:

• Fewer leaders means less built-in redundancy

• More institutional knowledge is tied to individuals

• Vacancies create both tactical and psychological disruption

Succession planning isn’t just about titles—it’s about protecting momentum. And if you wait until someone leaves to start the conversation, you’re already behind.

The Real Cost of Leadership Gaps

According to SHRM, replacing a senior leader costs anywhere from 90% to 200% of their annual salary, once you factor in recruiting, onboarding, ramp time, and lost productivity (SHRM, 2024). But that’s the quantifiable side.

The harder-to-measure impact includes:

• Strategy execution delays

• Decision-making bottlenecks

• Confidence loss from teams, customers, or investors

• Increased attrition due to perceived instability

  
  

In other words, you’re not just losing a leader—you’re losing momentum. And in a growth-stage or PE-backed environment, that kind of stall can have cascading effects across the business.

Why Mid-Market Companies Avoid Succession Planning

Let’s be honest—most of the leaders I talk to don’t avoid succession planning out of ignorance. They avoid it because:

• It feels like a luxury in the face of short-term priorities

• It gets tangled in politics (“We don’t want to play favorites”)

• There’s fear that talking about succession = encouraging exits

• There’s no clear process that fits a lean org structure

  
  

But here’s the truth: succession planning done right isn’t about exit scenarios—it’s about growth readiness. And the companies who build their bench proactively are the ones who scale faster, retain better, and avoid crisis-mode hiring.

What Succession Planning Looks Like Without Bureaucracy

You don’t need a 12-month HR initiative or a Fortune 100 org chart. Here’s how we guide clients through succession planning in a practical, strategic way:

1. Start with the Business, Not the Org Chart

Begin by asking:

• Which roles, if left unfilled for 60 days, would materially impact revenue, delivery, or customers?

• What leadership transitions are likely in the next 18–24 months?

• Where are we growing, acquiring, or restructuring?

This helps you focus on business-critical succession, not just title-based planning.

2. Conduct a Leadership Bench Audit

Forget the 9-box grid. Instead, build a simple heat map of:

• High-potential leaders (next 12–18 months)

• High-performers with development gaps

• High-risk roles with no clear internal successor

Gartner reports that only 33% of HR leaders feel confident in their internal succession candidates (Gartner, 2023). That visibility gap is the first place to focus.

3. Build Readiness Through Stretch, Not Talk

A name on a succession chart isn’t a strategy.

You need to test future leaders by:

• Giving them temporary responsibility for cross-functional initiatives

• Exposing them to board meetings, investor calls, or executive debriefs

• Having them present quarterly updates or own a major workstream

  
  

The more you can simulate the pressure of the role, the better the signal you’ll get on readiness.

4. Benchmark Internally AND Externally

Sometimes your next leader is in the building. Sometimes they’re not. But you won’t know unless you compare.

We help clients:

• Benchmark internal candidates against market expectations

• Align comp and capability expectations with what the role requires, not just what it’s paid today

• Identify when to promote—and when to search externally

This hybrid view leads to better decisions—and fewer costly rehiring cycles.

5. Make Succession a Living Process

Too many companies run succession planning like it’s an annual compliance exercise. But great companies build a cadence that adapts with growth.

Best practices:

• Review your succession pipeline quarterly

• Tie it to strategic planning and hiring forecasts

• Update plans after major milestones (e.g., acquisition, re-org, exit prep)

If it’s not evolving, it won’t protect you.

My Advice to Clients

Succession isn’t about knowing who you’ll pick next. It’s about knowing how you’ll decide—and what that person needs to be ready to do.

And that’s the key shift: Succession planning isn’t about replacing people. It’s about preparing capability.

If you want to protect your business, develop your next generation, and avoid “Oh No” moments, the time to start is before someone gives notice.

Conclusion

In mid-market firms, leadership transitions hit harder. You’re leaner, more reliant on individual leaders, and often scaling faster than your internal capacity.

That’s why succession planning can’t be an afterthought. It needs to be part of your strategy, your culture, and your rhythm.

If your last executive exit felt like a scramble—or if your leadership team can’t confidently name their successors—it’s time to build your bench.

Let’s make sure your next leadership move is a step forward, not a cover-up.