TL/DR –
Government contracting organizations face a lack of prepared leaders for senior positions. This slow-burn crisis is fueled by factors such as upcoming Baby Boomer retirements, security challenges and a reliance on subject matter experts (SMEs). The author suggests solutions like identifying critical positions, embedding succession planning in the business, fostering a nimble approach to workforce planning, encouraging attributes like tolerance for ambiguity, and using technology for ongoing talent data updates.
Addressing the Succession Crisis in Government Contracting
The time to start addressing the succession crisis in government contracting is now to ensure long-term success.
Government contracting organizations, even the most successful, face a succession crisis. Upcoming leaders are ill-prepared to fill senior positions. There is minimal discourse or data on how contractors can prepare for this crucial succession imperative. This crisis can be attributed to:
- Baby Boomer retirement wave: The long-discussed wave of Baby Boomer retirements is expected to hit government contractors hard. 25% of Aerospace and Defense workforce has more than 20 years of experience. With shrinking retention rates and 105,000 federal workers retiring in early 2026, the problem is more evident.
- Security challenges: With up to 250 days to get Top Secret clearance, a single unplanned departure could derail a government program for months, jeopardizing contract performance.
- Subject matter expert (SME) reliance: Government contractors depend on employees with specialized knowledge or experience which isn’t easy to replicate. In Aerospace and Defense alone, 67% of leaders say attracting talent is their most urgent issue. An unexpected departure of such an employee can set back operations for months.
Five Ways to Prioritize Succession Planning
1. Determine the most critical positions.
Identify positions that would cause significant strategic damage if left unfilled and require considerable time to fully integrate. These critical roles should be prioritized in succession planning.
2. Embed succession planning in the business, not HR.
Leaders in each function should identify and prepare high-potential team members for future leadership roles. Don’t solely rely on HR. Also, start capturing the institutional knowledge of workers nearing retirement to ensure smoother transitions in the future.
3. Create a nimble approach to workforce planning.
Encourage innovative thinking, a healthy view of failure, and cross-functional opportunities. Promote a development culture to reveal potential future leaders keeping the organization competitive.
4. Be a little bit counterintuitive.
In a world of constant change, identify important attributes that will benefit your organization. Emphasize more on experience, experimentation, and workplace development rather than formal education. After all, 70% of learning is experiential, 20% is social, and only 10% through formal avenues.
5. Employ technology and data.
Good succession planning involves maintaining and updating talent data regularly. Use AI tools to speed up analysis and identify talent or development gaps, reducing unexpected vacancies in critical roles.
In a constantly changing environment, it’s understandable for government contracting organizations to struggle with succession planning. However, creating a strong leadership bench is possible with a good foundation and a development culture. By prioritizing critical positions, organizations can prepare for whatever the future holds.
Daniel Stewart is the president of Stewart Leadership.
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