ABN AMRO ran a three-day programme for every officer at manager rank and above. The subject was this: what makes a bank a bank.
I attended it in the early 2000s. The facilitator opened with a question, and answers came back the way they always do in a room full of experienced people who haven’t been asked this before. Deposits. Savings accounts. Housing loans. Payment transactions. The facilitator let the room finish, then said: No. The business of banking is brokering. You take money as intermediary, you lend long, you borrow short, and you extract the margin between. Every ratio the organisation tracks, every headcount cost you manage, every basis point on a loan portfolio, it traces back to that one mechanism. Understanding it changed how I read every decision I was part of after that, because I finally knew what the decision was in service of.
I remember thinking: I’ve been in financial services for years, and nobody has ever explained this to me.
This was not a welcome-to-the-company session. The room was full of ranking officers, some with years of service already behind them. ABN AMRO ran it because knowing your own function and understanding the business you’re working inside are two different things, and they had decided the second one required deliberate instruction, regardless of your tenure.
That is what succession planning looks like. The real version, where an organisation takes responsibility for making sure its people understand what they’re contributing to, how the organisation survives as a going concern, and why developing someone through the ranks is an obligation rather than an optional bet. I attended that programme once, at a Dutch bank in the early 2000s, and I have not seen anything approaching it in any organisation since.
Every organisation I worked in after ABN AMRO shared a condition so common it stopped being remarkable. Most people had no idea what made the organisation viable. They knew the process they ran, the team they sat in, the system they operated. They did not know how the organisation generated its revenue or delivered on its purpose, what the unit economics looked like, or why any of it depended on them staying and growing rather than leaving when a better offer arrived. Nobody had explained it to them, because nobody had been tasked with doing so.
At ANZ National the closest attempt existed. There were frameworks, names in boxes, readiness ratings reviewed on a quarterly cycle. The structure was on paper. The problem is that a real succession pipeline requires sustained capital and sustained effort, and when the cost and effort came into focus, it didn’t fly. What happened every time a senior role opened was the same: the market. External hire, premium cost, cycle repeats.
At Stats NZ, BNZ, and Inland Revenue, the situation was simpler: there was no attempt at all. When roles opened, the organisation looked outside, paid more than an internal candidate would have cost, and called it efficient resource management. I watched that pattern hold consistently across every organisation I worked in, and the common element in each case was that nobody had ever explained to their people what business they were actually in.
The argument against investing in people has a surface logic. You develop someone, they build capability, and then they leave. The benefit flows to whoever hires them next. So the conclusion most organisations land on is to hire capability rather than develop it: bring someone in who already knows the job, carry the salary premium, avoid the development risk.
Follow that logic downstream and the flaw becomes visible. Workers trained somewhere, at some point, by someone. That somewhere has to exist. If every organisation applies the same reasoning and nobody trains, the pool of experienced talent available to hire from starts thinning, salaries at the experienced end inflate because demand accumulates without supply to match it, and the organisations that chose never to invest in developing people find themselves competing to pay for people that some earlier employer, somewhere, did invest in.
There is a fear underneath this that I’ve heard stated plainly enough over the years: if I train my people, I’m training them for my competitors. That fear isn’t irrational in isolation. Acting on it at scale creates the exact problem it was trying to avoid, a labour market full of people with skills but no organisational depth, moving from role to role because no organisation has ever given them a structural reason to stay.
The mechanism that resolves this tension does exist. Service bonds tied to development investment: the organisation funds a significant programme, the employee commits to a minimum tenure in return. Blunt instrument, but it aligns the incentives honestly. Chartered accountancy uses a version of this through its apprenticeship model, supervised work with a qualified firm before you can qualify fully. That pipeline is still functioning well enough in New Zealand that the programme is oversubscribed, hundreds of applicants competing for limited positions. The model works. It’s just not replicated at any scale elsewhere.
The default everywhere else is that development happens incidentally, through work, without structure. The organisation assumes the education system has done the foundational work. Graduates arrive, enter a role, and build from there. What the education system cannot do is teach someone the specific business of the specific organisation they’ve joined. That knowledge is internal. It requires someone to take the time to explain it, the way that facilitator at ABN AMRO took three days to explain what makes a bank a bank. Without that, you get people who are technically employable and organisationally adrift, contributing to a process without understanding what the process is part of, with no anchor deep enough to keep them there long enough to be developed into something the organisation actually needs.
Youth unemployment in New Zealand sits at 15.9% as of March 2026, per Stats NZ. Three times the national rate. The explanation most prominent in media and political commentary is AI. The story is that AI is absorbing entry-level roles, particularly in office environments where decisions are process-driven and binary, and the jobs that used to give young people a first foothold are disappearing.
There’s something in it. Roles built on processing work where the majority of decisions follow a predictable path and exceptions are all that require human judgment, those roles are genuinely exposed. Some of those positions were entry-level, and they’re thinning. That’s real.
But AI is a convenient story. It’s external, it’s technical, and it removes the organisation from the chain of causation. The economy plays the same role. When a commenter in my LinkedIn post that prompted this piece wrote that she hadn’t seen evidence of AI replacing entry-level jobs in practice, she was pointing at something real. I asked her whether she’d ever been on a succession plan in her organisation, or whether her company simply hired someone to replace her when she left. Her answer: she had not been on any succession plan, nor seen one in any organisation she’d worked for.
She runs her own contracting company now, which changes the equation for her. She keeps her skills current because she has to. But she had years of employment inside organisations before that, and the pattern she described is the one I’ve heard consistently across several sectors: no pipeline, no structured development, no explanation of what the organisation was actually trying to do. Just a job, adjacent to other jobs, in a structure nobody took the time to explain.
AI and the economy are cover stories. They describe conditions that are real enough. They do not account for the pipeline that organisations chose, over decades, not to build.
The mechanism isn’t complicated. An organisation that never explains to its people what it’s actually in the business of doing will not retain those people through difficult periods, will not develop them into the roles it needs filled at the next level, and will not be able to backfill from inside when the time comes. It will go to the market, pay the premium, and describe what follows as a talent shortage.
There is a talent shortage. It was constructed, incrementally, by organisations that treated succession planning as a compliance exercise and development as a cost to be deferred. The young people at 15.9% unemployment are the visible end of a problem that runs through every level of the workforce. The entry-level jobs are where the pipeline starts. If they’re shrinking, some of that is economic conditions, some of it is genuine automation, and a significant portion of it is that organisations have no structural incentive to create them when they’ve never built a development pipeline to justify the investment in the first place.
You can’t extract from the talent market indefinitely without anyone replenishing it, then reach for an external explanation when the extraction catches up with you.
I sat in that room at ABN AMRO for three days and came out knowing what I was part of. Every organisation I joined after that, I was still asking the same question.
Nobody offered the three days.