The COVID-19 pandemic has wreaked havoc on businesses, yet many are coming to terms with the economic and social devastation it has caused. Many firms are rebuilding, getting ready for a return to normal operations, and reexamining their personnel, processes, and systems.
Succession planning is one of them.
While it is critical to activate emergency succession planning for key C-suite positions, you must also give equal attention to other roles - particularly in mission- and operation-critical roles.
In turn, you'll undoubtedly have a competitive advantage when you return to normal operations because of these critical roles. Focusing on emergency executive succession planning is shortsighted and doesn't differ much from "replacement planning."
Retaining, developing, and leveraging future talent is even more essential than it was a year ago.
But how do you ensure your talents are always ready to fill the empty roles?
This article explains what succession planning is, why it matters, who should be in charge, and how to design an effective succession plan.
In simpler terms: Succession planning is a development process that focuses on developing talent to take over leadership duties when current leaders retire, move on to another firm, or leave for any reason.
Essentially, it is the continuous practice of identifying who in your company may grow into a more senior role, developing them to prepare them for the role, and assessing roles and skill gaps.
To do so, you must first find out who among your workers has a high potential. How can you accomplish this? One solution is to use performance-based skills mapping (will talk about this in the next few sections).
To the employer, it is a talent management practice that saves cost, reduces the chances of burnout among your talent, enhances productivity, and increases profitability.
Other reasons include:
To employees, business succession matters because it provides career development and progression. The Linkedin 2020 Global Talent Trends Report showed that companies with good employee training have 54% lower attrition. So, succession planning is also an effective strategy to retain your top talents.
Succession planning is important for critical roles that ensure the continuity of the organisation, including:
HR leaders are also looking into other non-senior roles that are critical to the company's continuity, such as sales and customer service.
You might expect the answer to be "once or twice a year" but in fact, it's a continuous process that happens throughout the year — especially in today's world where a single pandemic can change businesses upside down.
The general rule of thumb is to start now and plan the succession for the next 5 years.
Typically, succession planning falls under the HR department. Ideally, there should be a succession manager (or team) in charge of succession planning only.
This person or team is tasked with doing all the 5 steps of succession planning to ensure each key role has a prepared successor.
While each company has their own succession planning strategy, it can be generalised under the 5-Step Succession Planning Framework.
"What are the positions that are critical to the continuity of my business?"
This is the question you need to answer in the first step of succession planning.
But how do you determine those critical positions?
Look beyond the leaders (namely C-suites and middle management). Customer communication, sales, or product development also play an important role in the planning. Consider the expert or specialist jobs you have in your firm - and their importance to your company's overall success. They may not be management responsibilities, but if they remain empty, they might damper your company's bottom line.
Review your business strategy. Gather all of your business strategy papers, reports, and presentations to see how they address the key components for future years' implementation. When you think about the company's top priorities in the near future, do any departments, teams, or roles stick out? This might reveal gaps in skills or positions that need to be filled; it may also suggest the succession needs of your business.
Survey the market. Consider the following: Are there any skills or specialities that are currently in short supply? Which jobs are you having trouble filling owing to a lack of accessible external talent? What positions are difficult to fill generally – whether externally or internally? Examining your industry's current supply of talent - and even from outside it - is a great way to highlight those skills gaps.
Once you’ve determined the critical roles, the next step is to find out who is going to fill those roles.
"If we were to hire for X position internally, who would be the strongest candidates for this role?"
And the 2 follow-up questions are,
"Are these candidates ready? If not, what training do they need to be prepared?"
"If there are no strong candidates, who may be ready in the next 2-5 years?"
While the natural successor to a position may be the individual who is immediately next in line on the organisational chart, don't overlook other promising candidates. Look for people with the abilities required to succeed in higher posts, regardless of their current job title.
Talk with your employees about their professional ambitions. You might want to give them a promotion in the future, but you need to know what they think about this.
One way to do an objective scan on all your employees is to do a performance-based mapping.
Based on the potential and performance of each employee, categorise each of them in the appropriate boxes. Work with line managers and team leaders to get accurate information.
Tell the high potentials that they’re ripe for the fast track. They need to be told, otherwise, they will likely explore other options elsewhere.
Talk to them about why they're chosen, what their career trajectory will look like in the next 3-5 years, and what they need to do to close the gaps between who they are now and who they need to be.
Also, it's crucial to ask about their career plans and work-life needs such as childcare, flexible working hours or family health insurance. This is a great opportunity to take advantage of flexible employee benefits to retain your high potential employees.
Next, establish training and development strategies to help the high potentials close the gaps, including hard and soft skills. For example, technical skill training, leadership training, cross-departmental exposure, stretch assignments, role shadowing, and so on.
Ensure their managers are held accountable in their own performance review against closing those gaps.
Not all key positions can be filled internally. Your internal talents will run out eventually, so it's important to integrate your succession planning policy into your recruiting efforts.
Remember, you're not only recruiting for what's needed now, but you're also finding talents for the competencies needed in the next 3-5 years.
Did you know succession planning depends heavily on workforce planning? Read this article "HR's biggest challenge: Shaping the future of workforce" to find out how you can stockpile talents and stay ahead of your competitors.