Benefits and Importance of Succession Planning
There’s an old saying that explains the inherent benefits of succession planning best: If you fail to plan, you plan to fail.
One of the most disruptive things that can happen to an organisation is the sudden need to replace a leader. In today’s era where talent is scarcer than ever, it is an even higher priority for most organisations to prioritise this aspect in their strategy to survive this ever-changing landscape. HR Leaders should not underestimate the complexity involved and the important linkages to such programs. Succession planning is a key part of any business continuity program, and the pandemic has helped us realise how critical it is.
It’s a bit like chess where HR professionals must assess the board with an eye on the
next move—and the next five moves thereafter. If one piece falls, the individual must develop a winning strategy using the remaining pieces. Many organisations don’t think about it until
someone retires or dies. This process is vital for organisations to ensure business
continuity, success and achievement of business goals. Around 86% of leaders believe in the urgency and importance of succession planning in organisations.
Why is succession planning important? Is it only for top-tier employees of the organisation?
One of the most common myths surrounding the phrase “succession planning” is that it’s only viable for senior-level replacement. This myth has two errors. Firstly, it’s benefits include
nurturing a prospective candidate for senior, mid-level executives, or any key job position. Secondly, this process goes beyond simple replacement planning.
It’s common to see employees picked for key positions only because they made a better impression on their seniors during the process. These decisions based on emotional hunches can lead to immense uncertainty.
An effective succession plan equips identified successors with the skills and competencies needed in their future roles. By using a customised development plan, you can promote employee growth and ensure your successors make the right impact. HR leaders won’t be scrambling to fill open positions when top leaders leave. Still uncertain about why HR leaders should implement succession planning within their organisation? Let’s gain insight into the discussed points below, highlighting the importance of succession planning.
1. Guideline For Training And Development
The correct plan helps to guide the organisation’s training and development strategy and prepare employees for their future role. It identifies areas for growth within each employee so they can develop critical skill sets, empowering them to thrive now and in the future.
2. Promote Long-Term Planning
Businesses that aim for long-term success need to have long-term plans. In the face of rapid change, organisations need strategic plans to guide their actions. The succession plan helps in creating a path to retirement for top leaders and ensures their expertise is transferred to their successor. By outlining clear plans, HR leaders can curate strategies that suit best to help grow and evolve individuals, teams and organisations.
3. Establishes Your Legacy
When leaders are aware of their successors, they’re able to provide mentorship and share knowledge. This way, when top leaders exit, their contributions and impact won’t leave with them. All the hard work put in throughout the years will be translated into future efforts of their successor and leaders can leave a lasting mark on the organisation.
In recent research, it is found that 61% of executives fail within the first 18 months of being promoted or hired due to the lack of succession planning in organisations. Now that you have understood the importance of succession planning, let us understand the key benefits of inculcating this process by HR leaders, within the organisations.
1. Forget Single-Succession Planning
A big part of agile succession planning is thinking beyond one successor for each role. Since positions can evolve over time or disappear altogether, consider selecting high-performing individuals and preparing them for more than one role. Find multiple positions that could be a good fit, see where their interests lie and help prepare them for success in several potential roles.
2. Build a culture of continuous learning
Succession planning isn’t just about selecting future leaders based on their current skill set. It is also about understanding leadership potential and encouraging internal candidates to grow their knowledge and skills to fit for any future opportunity. Creating a culture of continuous learning can play a huge role in turning managers into leaders and establishing an agile environment where multiple candidates are being prepared to step into a leadership position.
3. Building Competencies
The whole process must look at building the competencies and skills for current and future organisational needs. It has been correctly observed that the focus is on “what is next?” not just “who is next?” There will be multiple sets of competencies (i.e., knowledge, skills, and abilities) for each position. However, in creating a development plan to build the competencies of succession candidates to be ready for the intended future role, there will be individualised development plans which can help them to thrive for upcoming opportunities.
4. Building A Sustainable Pipeline
An effective succession plan is critical for any organisation to achieve long-term success. By having the right people in the right place at the right time, your organisation can expect to deliver on long-term goals and strategies and rebound effectively from departures, retirements and other separations from the company. Those diligently working their way up the pipeline will enjoy a work environment that is focused on their growth and success and in turn, deliver greater engagement and productivity while being more interested in seeking key leadership roles and taking the necessary steps to get there.
The benefits are numerous, but not always well recognised. Most corporate entities today, regardless of size and location, cannot do without a carefully crafted management succession plan. In order to minimise risks here are the few points to keep in mind before implementing succession planning.
Things to Consider Before Implementing Your Succession Plan
1. Don’t Focus Solely on Leadership Roles
If you focus too much on leadership roles, you might miss out on opportunities to level up your entire team. Instead, map out the talent capabilities within your organisation and mitigate the talent gaps left by departing team members. Your plan should include all roles that impact the day-to-day running of your organisation.
2. Keep Communication Open
You must share your strategies and processes for the plan to be successful. Your employees want to know if there is a future for them at the organisations. It’s essential to keep employees informed. It’s a morale booster for the potential candidate if they know everyone is invested in their development and future.
3. Regularly Review Your Succession Plans and Strategies
One of the most important parts of succession planning is documenting the process. HR leaders need to regularly review plans, processes, and strategies to ensure that transitions are smooth and all parties are happy with the way future leaders are chosen, developed, and hired.
It helps your business prepare for all contingencies by preparing high-potential workers for advancement. Here are 3 steps to follow for kick-starting the planning process at your organisation.
Steps for succession planning: Build your future team with 3 steps.
1. Assess your current and future strategic goals
Top leadership needs to develop and communicate a clear vision and strategic roadmap for your organisation’s future. This should include a detailed assessment of your current business model, that of your competition, and all strengths, weaknesses, opportunities, threats, and any other external factors that need to be accounted for to hit this strategic goal.
2. Choose Your Succession Planning Strategy
HR leaders should evaluate if the organisation’s needs closely align with their existing workforce and strategic goals. A detailed analysis and reports should be created to understand its impact in the future of the organisation and after evaluation a clearer strategy and roadmap can come into frame.
It is, inherently, a long game which takes time to develop, and even longer to see the results of your effort. Those results, however, can mean the difference between smooth transitions of productivity and knowledge and lost output at critical stages in your company’s strategic growth. A smooth procedure can only happen if the following things are kept in mind before implementing effective succession planning.
In today’s ever-changing landscape and in the era of Great Resignation, organisations should not only plan succession plans for the higher rank employees but also include all the workline employees.
According to a survey, more than a third of HR leaders said they find it difficult to develop effective senior leaders and 45% reported that they struggle to develop good mid-level leaders.
Did you know?
The assessment center helps in identifying and preparing the high-potential performers for the future, ensuring the seamless movement of talent within the organisation. Wondering what are top four assessment center exercises used in succession planning. Read our blog now!
Investing time into succession planning has a great impact on creating and maintaining the plan for any unwanted situations that can arise in the future and also helps in engaging employees by providing future growth opportunities within the organisation.
2022 is the year of intentional change – especially within the business landscape. While the past two years presented unknown variables whose effects were shrouded in uncertainty, organisations were often reactionary to these changes. It’s introduction can help HR leaders strengthen to build the future of the organisation in this rapidly changing business landscape. Most corporate entities today, regardless of size and location, cannot do without a carefully crafted management succession plan, talk to our expert now to know more. now to know more.