Succession planning focuses on identifying and growing talent to fill leadership and business-critical positions in the future. It involves continuous discussions about talent and resources and action-oriented planning for the future. Succession planning is a proactive process of identifying roles considered to be at the core of the organization, and then implementing a plan for keeping those roles filled by qualified and capable employees, for the short, medium, and longer term.
- What is succession planning?
- Why is business succession planning important?
- What is the connection between succession planning and talent management?
- What is involved in succession planning?
- What is the connection between succession planning and recruitment?
- How often should succession planning be done?
- Should succession planning be secretive?
- How is an effective succession plan created?
- How should key roles be identified for inclusion in a Succession Plan?
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What is succession planning?
Organizations need to have a strategy for understanding the strengths of the current resources and peoples’ motivations and aspirations for the future. This data enables organizations to identify gaps between the ideal future critical talent landscape and the current view. Once these gaps are known, organizations can adopt strategies to address them, by implementing and maintaining actions to attract, acquire, develop, and retain key talent.
Why is business succession planning important?
Businesses that regularly discuss talent and have a good understanding of future needs give themselves a better chance of adapting and responding more quickly and effectively in the face of change. Strong talent is always in demand. Proactively and strategically investing in development of existing talent to grow into future leadership and business-critical positions gives organizations a competitive edge. Effective business succession planning allows organizations to make sound financial decisions about recruiting external talent alongside developing internal talent.
What is the connection between succession planning and talent management?
In order to ensure succession planning goes beyond the simple creation of a plan, organizations must have a strategy for bringing that plan to life and keep it up-to-date with any internal (e.g. structural) or external (e.g. market forces) changes. Talent management is the best way to do this. Talent management is the strategic approach to addressing gaps in capability, knowledge, and experience in the current resource pool, enabling the organization to meet its future goals.
What is involved in succession planning?
Succession planning needs to start with the future requirements in mind – what roles and people resources will the organization need to be successful in the future? Most succession planning focuses on mission-critical roles and responsibilities, so these should be identified initially. Typically, succession plans cover all leadership positions and some specific expert roles which require deep expertise. An effective succession planning process then identifies feasible options for replacing people in any of these current roles should they move outside the organization; this information is then recorded in an appropriate location.
What is the connection between succession planning and recruitment?
While there are various approaches to succession planning, they all tend to take a longer-term perspective than replacement hiring, which focuses on filling vacancies when they arise. Effective succession planning allows organizations to make better decisions about where to spend money on recruitment. By proactively developing the existing talent within an organization for key positions in the future, the costs associated with searching for, selecting, and onboarding external recruits can be reduced and instead invested only on targeted positions.
How often should succession planning be done?
Whilst it is often built into an annual cycle, succession planning should be a continuous process, kept live all the time through active discussions and attention on talent development. Individuals’ aspirations and motivation can change over time, and organizations who fail to stay close to their talent, as well as the business’ changing needs, do so at their peril.
Should succession planning be secretive?
Succession planning has the most impact when it is transparent. Understandably, some organizations keep information about succession planning secret for fear of creating expectations that cannot be met, as well as disappointment in those people not identified as successors. However, creating a culture of transparency based on open and constructive feedback is the best way to engage employees and help them understand expectations and where to focus their development. Organizations that encourage these honest, two-way conversations create a climate based on trust that enables everyone to thrive and strive to perform even better.
How is an effective succession plan created?
Typical steps in an effective succession planning process include:
- Consider your organizational strategy and future resourcing needs
- Identify the key roles required for future success
- Assess existing resources to understand their capabilities, aspirations, and potential
- Identify possible HiPo’s (high-potentials)
- Build a strong talent pipeline by mapping HiPo’s to key roles along with readiness (the suggested time period needed for them to be ready to take on the specified role)
- Create a development strategy that will close the gaps in capability and readiness
- Continually invest in the development of your potential future leaders (through development planning, special assignments, coaching, mentoring, feedback, etc.)
- Regularly monitor and assess leadership bench strength and keep up-to-date with their aspirations and motivation
- Make succession planning a part of the recruitment planning process – evaluate your succession plans before assuming external recruitment is required
- Monitor the success of the succession planning and fine-tune the process as required
How should key roles be identified for inclusion in a Succession Plan?
Although it might be tempting to attempt to include all positions and roles in succession planning, this is unlikely to be feasible or realistic. Succession planning usually focuses on the most important roles in an organization and involves identifying those that place greatest risk to the organization if left unfilled. Here are some questions to help identify the roles to be included in succession planning:
- Are decisions made by the person in this role significant to the company?
- Is this a leadership role, and does it have direct responsibility for a large team?
- Does this role require specialist knowledge that is hard to replace?
- Is there a high risk if a person in this role joined a competitor?
- Would filling this position be more protracted and costly than most other roles?
- Would it take a significant effort and an elapsed period of time to train a successor for this role?