“The ability to make good decisions regarding people remains one of the last reliable sources of competitive advantage, since very few organizations are good at it.” –Peter Drucker
What would you do if a key employee in a critical position suddenly resigned, became ill or was terminated today? Would there be a mad scramble as you tried to recover or would you be prepared to carry on in a productive manner? If your answer is the former instead of the latter, then your organization is opening itself to unnecessary risk and potentially compromising its long-term survival. How does a forward-thinking organization reduce/eliminate such unnecessary risk? They leverage a Succession Plan.
Many organizations have little or no succession planning in place and if they do, it is shrouded in secrecy with very few “in the know”. Although many say they value succession planning, the management literature suggests that up to 67% don’t utilize the process. Organizations without succession plans don’t realize that ultimately it will cost them more to replace key leaders and deal with constant turnover of talent than if they had taken the time to develop a succession plan.
Add in the differences in how the new multi-generational workforce views their careers and the need for a strong succession planning process is greatly magnified. Managing the succession of talent is an important strategic process that helps to minimize gaps in leadership and enable companies to develop and retain their best employees. Succession Planning needs to be a priority for every organization that wants to be successful in an ever-changing business environment.
This article will cover what Succession Planning is and isn’t, critical elements of a plan, and a short case study of succession planning in action.
Succession Planning is a deliberate and systematic effort by an organization to ensure leadership continuity in key/critical positions. It is a key proactive management practice that identifies, develops, and retains a pipeline of leaders for the critical organization positions in an attempt to drive operational success. It also helps to enhance the organization’s opportunity to retain and develop intellectual and knowledge capital for the future. Most practitioners would go as far as to say that Succession Planning reduces risk and is vital to the long-term survival of any business. Sounds good – right? Yet some organizations choose NOT to do succession planning! Many reasons (excuses) are given for not doing it (the CEO already knows, takes too much time to manage the process, things change too frequently, etc.), but most ring hollow.
Sometimes, knowing what something isn’t may be more helpful than knowing what it is. In this case, Succession Planning isn’t just something that is done when the CEO or another Key Leader is exiting the organization and a mad scramble takes place to find an internal candidate. It is not just done to meet some type of Board of Directors requirement – check the box. And it shouldn’t be treated as some type of top secret intelligence report with only a select few knowing the details. It isn’t an assumption that the next in line in a given department or corporate structure is the successor. Yet, we have all worked at organizations that do all of this. Again, why take such unnecessary risk?
Good, proactive organizations devise models to characterize their succession and development practices. Most reflect a cyclical series of activities that include these fundamentals:
Identifying key roles for succession planning (critical positions)
Defining the competencies and motivational profile required to undertake those critical roles
Assessing people against these criteria
Identify pools of talent that could potentially fill and perform highly in key roles (internal and external candidates)
Developing leaders to be ready for advancement into key roles – primarily through the right set of experiences
Many practitioners and organizations overthink and over-complicate Succession Planning. Truly, it doesn’t need to be that difficult. Once you have the buy-in from the top of the organization, which is the most critical element and sometimes the most difficult to achieve, the rest of the process is manageable.
The most common Succession Planning process consists of six steps:
The following is a case study of how the 6 Step Succession Planning has worked:
Five Year Results:
SUCCESSion Planning is a trademark of the ultra-successful organizations, regardless of their size. Not having a succession plan can undermine an organization’s effectiveness and its business sustainability. Without a succession planning process, your organization may not have a means of ensuring that the programs and services that are crucial to its survival are able to be sustained beyond the leadership of those who are currently responsible for them. Why take that risk? Succession Plan. There is a reason Succession Planning starts with the word “SUCCESS.”
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