What is Succession Planning?
Succession planning is a process of planning the leadership and management for the future of the company. It is a strategy used by organizations to identify and develop potential employees to fill critical roles and maintain continuity in business operations in case of uncertain changes such as the sudden demise of a leader, resignation of experts, or other departures, etc.
The benefits of succession planning are massive and have a lasting impact on the operations of the business. The purpose of succession planning is to fill key positions in the company in the future or during adverse circumstances that arise due to uncertainties.
How does the Succession Planning Process work?
The succession planning process includes a few basic steps that are essential to make the process robust and implement the best practices that would not only benefit the organization but would also raise the career graph and capabilities of the employees.
1. Identify the Key Roles
As with every other planning the succession planning process also needs to be aligned with your goals. You can start with what your company want to achieve in the next 5-10 years. Then you can decide on whether you want to be prepared for the C-suit for middle-level management or if is it a new key role that you need to be craft.
Access the key roles which can drastically affect the organizational process for example, you can’t afford to keep the position at C-suit vacant when a company is going through some significant transformation. These times often cause changes which might lead to turmoil if you don’t have someone who can make quick decisions in the position of leadership.
Similarly, if you are going for expansion or entering a completely new market you may need to assess the skill requirements for the workforce on the ground. Succession planning helps you ensure that you will continuously have people with the right experience and skills in the company even if these are very rare in the market. You definitely need succession planning for the key role where talent in the market is extremely rare.
2. Build the Profiles
Once you identify the goals and the roles that need to be included in the succession planning you need to make an ideal profile for the same. The profiles include the skills, experience and expertise that you need for these positions.
These profiles also include factors such as leadership qualities and decision-making skills. You may also have to craft a completely new position for the goals and objectives that a company want to achieve.
3. Identify Potential Employees
Once you understand the profile you need for the key roles in the company. The next comes in identifying the high-potential employees in the company who can be groomed for the future requirements of the company.
It’s best if you start your succession planning at the stage of recruitment where you can select candidates who possess the soft skills that you need in the organization’s leaders.
Assess the present talent in the company that matches the profiles in the succession planning. You can discuss career planning with them and identify the areas for training and development. You need to perform this assessment at every level of the organization that needs to be included in the succession planning according to the goals of your succession planning program.
You can also come up with the criteria for your succession planning needs so you will get all the data related to your skills and knowledge. Defining criteria helps you asses employees uniformly so you don’t miss out on the talent you need.
4. Training and Developing
After shortlisting candidates for the succession planning program, you need to mend a training program for them. Focus on the crucial skills, knowledge and experience required for the position and design a program around it.
When it comes to the positions of leadership in the organization, you also have to include wider exposure, leadership skills, and decision-making for the candidate. It is also a good idea to get them into a mentorship program with an employee who has the experience they would need to speed up their preparations.
5. Review and Update
When it comes to the succession planning process you can’t overlook the reviewing element. The Succession is a continuous planning and you need to evaluate the progress of your employees a regular intervals to ensure the training and development efforts are aligned with your succession strategy. This will help you to identify the shortcomings in the plan and make the necessary changes.
Succession planning is usually a long-term process as you are preparing in advance plenty of changes can occur and you need to adapt accordingly. For example, the candidate in the consideration leaves a company or the organization goes under reformation and the position is no longer available.
Along with assessing the development of those employees in the program, you should stay open toward the other emerging talents. You also need to keep the succession planning program updated according to the changes in the market as well as the goals and objectives of the company.
Objectives of Succession Planning
The primary objective of succession planning is to fill the key positions in the company and to make sure no leadership positions stay vacant for long to avoid disruptions in the functioning of the business.
Apart from this, the succession planning process has significant objectives that have impactful effects on the health of the business growth, development, and advancements.
Let us understand in detail what are the objectives of the succession planning process:
➔ Continuity in Leadership
One of the important objectives of succession planning is to maintain continuity in leadership by keeping the positions filled within the company even in the uncertain circumstances that arise due to unexpected factors such as the sudden demise of any leader, the resignation of proficient experts, etc.
Continuing leadership is essential for the business to function and grow without disruption with the change in leadership or management. In the succession planning process, the proficient candidate is trained to adapt to uncertain situations and to ensure convenience to adapt to the workforce efficiently.
Furthermore, the succession planning strategy focuses on improving employees’ skills and knowledge, making them acquainted with the uncertain challenges and emerge even stronger in adversities.
➔ Adapt to Uncertainties
Another major objective of the succession planning process is to make the employees used to challenges that might arise due to uncertainties. It ensures that there are proficient backups for the leadership roles to be able to handle the business operations even in the grey of situation.
Businesses are subject to uncertainties which makes it prone to risks and conflicts. In the succession planning process, the organization prepares the proficient employees to adapt to changes by enhancing their skills, making them a part of the decision-making team and relying on their decisions and analytics.
A key component in the succession planning process is to have a “plan in place” which signifies having ready resources in the workplace to avoid disruption in business operations due to the unavailability of an adequate workforce.
➔ Develop Internal Talent
The succession planning process focuses on identifying the potential internal employees from the organization and focuses on improving their skills and knowledge by providing them adequate training and developing scopes. This can be done by accessing the performance management software, from which the performance metrics of employees can be gained.
The advantage of strengthening the internal employees skills in succession planning is in-depth knowledge of the employees on the work culture and ethics of the business as well as providing them the opportunity to nourish their career opportunities.
Furthermore, developing the skills of internal employees can be a great way to induce and strengthen trust and employee bonding hence resulting in enhancement of retention rate of top talents in the organization.
➔ Retain Top Talent
A business operation is majorly dependent on its proficient resources which includes top talents who implements creative and innovative ways to handle daily business operations. Their vision, decision and perceptions are the elements that contribute to a successful business outcomes.
Succession planning is a significant strategy to retain top talents and experts by developing their key skills and encouraging them to be the future leaders of the business. This not only fosters their morale but also increase their sense of accountability and responsibility towards goal achievement of the business.
Hence, improving the retention rate of talented employees and enhancing their skills to face the future challenges with proficiency.
➔ Enhance Organizational Growth and Stability
When the key roles in a company stays filled with fresh, well-skilled and proficient talents, the growth and stability of the organization enhances. Succession planning involves skilling and developing top talent management for future leadership roles which as a result improves the productivity of the organization.
Furthermore, the goodwill of the company in the market surges with the retention of top talents which as a result reflects the credibility, growth, and development of employees in the organization. This attracts competent, skilled, and versed candidates to get associated with the company. Also, it attracts stakeholders to invest in the organization which is well-equipped with market experts and accomplished leaders.
Benefits of Succession Planning
There is a requirement for succession planning in every organization as there are always some job roles that form a bottleneck effect in an organization if they stay vacant. Incorporating succession planning in HRM strategy ensures that stagnancy will never happen due to vacant key position. Succession planning also brings many benefits to an organization, some of which are listed below.
1. Lower Hiring Costs
One of the benefits of succession planning is that it can drastically bring down the cost of hire when done right. Recruitment is one of the most costly processes in the organization. When a crucial position in the organization stays unoccupied for the long term, companies often panic and end up paying higher than they should be and rush into bad hiring decisions leading to long-term regrets.
Succession planning is a tool that helps you ensure that you don’t need to make those hasty decisions and always have the talent in the pipeline. That way you can save money wasted on the hiring effort and the losses that the company might incur if the position stays vacant or gets handed to the wrong person.
2. Increased Retention
Ambition is one of the key qualities when it comes to the top performers. The best talent in the industry prefers to work with the companies that help them grow in their career. So when you have a good succession planning program in the company it not only ensures that the leadership needs of the organization will be met but also attracts new talent. The opportunities that a succession plan brings, build you an image of an employer who cares about their employee’s skills and development.
When you have a succession planning program it creates growth opportunities for your employees. A succession plan allows you to offer them growth opportunities so the employees don’t need job hopping, and stay in their job for a longer time resulting in higher retention.
3. Skilled Workforce
When you have succession planning as a crucial ingredient of the growth strategy in the company you get a high-potential workforce for the long term. When there is succession planning, you also train employees for future roles of leadership and other critical roles.
This way, you craft a well-skilled workforce that is ready to tackle bigger challenges. In addition to that you get higher retention, which means the top performers and skilled employees stay longer resulting in a skilled workforce.
4. Reduced Disruption
Effective succession planning is a great way to mitigate the risks of disruption that might happen due to unfilled critical roles in a company. In unforeseen incidents when someone leaves without notice, such as in case of severe health issues or unexpected death, the company can always rely on their succession planning program.
It’s always difficult to find the right people for the roles of higher responsibility and the delay can have devastating effects on the company. But when you know that have the right people within the organization you mitigate all such risks.
5. Saves time
When you have a plan in place for the succession planning process you end up saving a lot of time for the company.
Once you invest your time to identify high-potential employees and include them in the succession planning program you don’t need to put your time and effort separately into various challenging situations that may arise. Such as when an organization needs someone to handle greater responsibilities than what their current role demand you know to whom you can trust.
In addition to that when you include succession planning in HRM strategy of your organization, the training and development is carried out with the perspective of the leadership. Candidate who are part of a succession plan are likely to share their learning with their team leading to the development of the entire team.
What is the Role of HR in Succession Planning?
The human resources department plays a crucial role in the succession planning process. Some of the significant roles of an HR in succession planning are as follows:
➔ Identifying the key Positions
The primary job role of HR in succession planning is to identify the key positions in the company. Key positions refers to the vital or crucial job posts that needs strong leadership and supervision that are essential for the growth and development of the organization. It includes senior managerial roles such as vice president of different departments, AVPs, CEO, CXO, etc.
The successors of these posts need to be proficient enough to deal with uncertainties and challenges with convenience and innovation.
HR plays a vital role in identifying potential candidates who can be an essential asset to the organization and contribute to the business’s success.
➔ Talent Management and Assessment
Talent management and candidate assessment are other important roles of HR in succession planning. HR conducts the assessments of candidates and filter the proficient candidates among them to train and develop them for future contingencies.
This includes evaluating their capabilities, knowledge on the subject, skills, innovation and creativity, as well as analytical problem-solving capabilities, and decision-making precisions at times of challenges.
Also, they shortlist the candidates as per their capabilities from the employee management system and craft adequate training plans in the training management system that would benefit both the candidates as well as the organization’s budget hence eliminating wastage of resources.
➔ Defining Requirements
HR professionals play a crucial role in defining the requirements or eligibility criteria for candidates in the assessment test for succession planning. This helps keep the company away from conflicts that may arise due to unclarified eligibility criteria, biases, discrimination, etc.
Providing equal opportunity and chances to proficient candidates is the ethical responsibility and role of HR professionals. So, defining the requirements is vital to open up the scope for the eligible candidates equally without making any personal selection based on favoritism and biases.
➔ Maintaining Transparent Communication
Maintaining transparent and clear communication regarding the framework, process and assessment procedure for succession planning with the employees is a crucial role of HR in the process.
Communication is the key to success for every tasks, so the benefits of succession planning and its implementation can only be accomplished with clear communication and can be effective only when communicated with transparency.
When employees get the clarity of what to do, how to do and when to do, they tend to perform better and stay distance from perplexities and confusions.
➔ Creating, Developing, and Implementing Plans
To frame a perfect cost effective succession planning process inclusive of proficient tactics and strategies to train and develop versed candidates and improve their skills is an essential role of HR in succession planning.
Also, the smooth implementation of the strategy which includes transparent communication to the candidates, management, trainers and all of those associated with or are a part of the succession planning process is the job of HR.
Furthermore, they make sure the resources are utilized at its optimum hence eliminating wastage of financial resources, time and labor in implementing the process.
➔ Monitoring Processes
To monitor the evaluation, Training and developing processes in the succession planning process is crucial job role of the HR.
They make sure the training and developing sessions are effective for the growth and development of the candidates and they are availing them to the fullest. This will also ensure that the resources are not wasted and the business investment on its employees for future are adequately spent.
➔ Aligning Business Strategy with Succession Planning
The succession planning strategy should align with business strategy for benefitting the organization in the long-run. HR professionals need to be efficient enough to align both the strategies and craft it likewise to avoid wastage of resources and efficient use of succession planning in enhancing the productivity of the company.
Apart from identifying the key roles and efficient employees, the HR managers are required to update their skills and knowledge on the prevailing marketplace trends, advancements in technologies, etc, and also strategize succession planning plans in accordance with it as well as the company policies.
This will help candidate stay updated with their training along with the vision of achieving the company’s goals in the long run.
➔ Reviewing Plans
A succession plan is the process of continuous evaluation and updation. To review the implemented succession strategies is essential for the HRs to keep the progression in check. This will help plan the run-time strategies and face challenges with proficiency.
Furthermore, reviewing the succession planning strategy will also keep the budget in check and help the management from wasting resources due to confusion.
➔ Fostering a Culture of Diversity
HR planning the succession, ensures that there are diversified audiences in the strategy and all are selected on the basis of their capabilities and skills. This will reflect the non-discriminated procedure and fairness in the succession planning process, which will encourage employees morale and foster a sense of responsibility among them to perform in their best of potential.
➔ Conditioning Transitions
HR professionals plays a vital role in smoothening the transition of old leaders offboarding and new ones onboarding onto their posts. This requires smooth handovers, knowledge transfers and asset management which the HR department takes care of and efficiently transists the process hence securing the organization’s future success.
Steps in Succession Planning
When it comes to the term succession planning it can mean something different for every company. As the goals and needs of an organization differ so does have to be the succession planning process. The core of the term succession planning is the same so are the basic steps that need to be followed, you need to modify these to make those most effective for your company’s goals.
1. Identify the Key Roles
As with every other planning the succession planning process also needs to be aligned with your goals. You can start with what your company want to achieve in the next 5-10 years. Then you can jump to whether you want to be prepared for the C-suit for middle-level management or if is it a new key role that you need to be crafting for.
Access the key roles which can drastically affect the organizational process for example, you can’t afford to keep the position at C-suit vacant when a company is going through some significant transformation. These times often cause changes which might lead to turmoil if you don’t have someone who can make quick decisions in the position of leadership.
Similarly, if you are going for expansion or entering a completely new market you may need to assess the skill requirements for the workforce on the ground. Succession planning helps you ensure that you will continuously have people with the right experience and skills in the company even if these are very rare in the market. You definitely need succession planning for the key role where talent in the market is extremely rare.
2. Build the Profiles
Once you identify the goals and the roles that need to be included in the succession planning you need to make an ideal profile for the same. The profiles include the skills, experience and expertise that you need for these positions.
These profiles also include factors such as leadership qualities and decision-making skills. You may also have to craft a completely new position for the goals and objectives that a company want to achieve.
3. Identify High-potential Employees
Once you understand the profile you need for the key roles in the company. The next comes in identifying the high-potential employees in the company who can be groomed for the future requirements of the company.
It’s best if you start your succession planning at the stage of recruitment where you can select candidates who possess the soft skills that you need in the organization’s leaders.
Assess the present talent in the company that matches the profiles in the succession planning. You can discuss career planning with them and identify the areas for training and development. You need to perform this assessment at every level of the organization that needs to be included in the succession planning according to the goals of your succession planning program.
You can also come up with the criteria for your succession planning needs so you will get all the data related to your skills and knowledge. Defining criteria helps you asses employees uniformly so you don’t miss out on the talent you need.
4. Construct a Training and Development Plan
After shortlisting candidates for the succession planning program, you need to mend a training program for them. Focus on the crucial skills, knowledge and experience required for the position and design a program around it.
When it comes to the positions of leadership in the organization, you also have to include wider exposure, leadership skills, and decision-making for the candidate. It is also a good idea to get them into a mentorship program with an employee who has the experience they would need to speed up their preparations.
5. Review the Succession Planning
When it comes to the succession planning process you can’t overlook the reviewing element. The Succession is a continuous planning and you need to evaluate the progress of your employees a regular intervals to ensure the training and development efforts are aligned with your succession strategy. This will help you to identify the shortcomings in the plan and make the necessary changes.
Succession planning is usually a long-term process as you are preparing in advance plenty of changes can occur and you need to adapt accordingly. For example, the candidate in the consideration leaves a company or the organization goes under reformation and the position is no longer available.
Along with assessing the development of those employees in the program, you should stay open towards the other emerging talents. You also need to keep the succession planning program updated according to the changes in the market as well as the goals and objectives of the company.
End Note
The motive of succession planning is to maintain the productivity of an organization in the future. In succession planning and strategy, you aim to develop talent in the company to fill leadership and other key positions for the future. You need to understand the long-term goals, identify skill requirements and train your potential employees to fill these requirements in the future. The succession plan needs to be flexible and constantly monitored for your company to be prepared for future challenges.
