Succession planning means different things to different people, but the most common theme among all the definitions that exist is that it involves making sure your business is prepared for the future. There are different types of succession planning, each of which depend on your type of business and your businesses’ specific situation.
Let’s test your knowledge by having you answer a quick question: Based on your own personal understanding, which scenario do you think best describes this crucial business function?
If you answered B, you are correct, but keep reading. There’s plenty of new insight and ideas you can apply to your existing knowledge.
If you answered A, you are incorrect, so again, keep reading. We’ll give you lots of applicable information so you can implement this important planning tool into your business toolbox.
If you answered C, maybe read this article two or three times to see if you can flip that thinking! :)
In this article, you’ll learn how succession planning and leadership development naturally tie together in pursuit of one fundamental goal: preparing your people with the right skills. Most important, you’ll learn how to create a roadmap to enable your company to move and shift quickly when changes in industry, technology and operations transpire.
First, let’s put this oft-heard preconceived notion aside: no matter how big or small, young or old the company or CEO may be, no business should be without a succession plan! Succession planning gives organizations an opportunity to become proactive instead of reactive when it comes to developing leaders and filling vacancies. If you're a CEO and need help with succession planning, read this blog.
Another common myth about succession planning is that succession planning is only for C-suite replacement … but don’t fall into that limited line of thinking, instead go ahead and read about the three different categories of succession planning.
According to the Bureau of Labor Statistics, 4,000,000 baby boomers are set to retire this year alone, taking with them years of expertise and experience. Take a look below at the visual depiction of the shift in our labor force.
As you can see from the graph above, we’re about to lose a huge number of leaders from the workplace, yet many businesses are failing to give up-and-coming employees the leadership development they need to succeed.
According to Software Advice, an HR and recruiting technology research firm, 79% of employers surveyed note they have succession plans in place only for critical positions with highly experienced and knowledgeable employees. Further, over 90% of younger workers (age 18 to 34) say that working at a company with a clear succession plan would ‘improve’ their level of engagement.
This brings us to an urgent question: Do you have the next generation of your workers ready to fill the shoes of those who are departing? Are they prepared to take on roles at all levels of your company? If not, it’s time for your business to make plans.
The boomer/millennial baton handoff shouldn’t be a hasty task, instead it should consist of a long-term process for managing talent across your organization, while establishing a steady, reliable pipeline of leadership candidates. Think of this as a best practice for sustainability.
The best way to reduce the effect of lost talent and underdeveloped employees is to take the time to develop a leadership-based succession plan that focuses on developing and mentoring the next generation.
At this point, you may find it helpful to go through our pre-succession planning checklist, but if you’re ready to begin thinking about your leadership development roadmap, follow the 5 steps below to get started:
Step 1 – Document current and future organizational structures
Map out your organizational structure as it is now and project how it might look several years from now. Consider your future goals and the types of leadership and positions you need to reach those goals.
Step 2 – Identify and define capabilities for key areas and positions
Assess and designate those that are critical to the organization’s operational activities and strategic objectives. Determine specific functions and update job descriptions.
Step 3 – Pinpoint Interested employees and assess them against capabilities
Meet individually with those who have the interest, knowledge and potential to fill key areas and positions.
Step 4 – Identify knowledge loss risks and priorities
Set strategies for learning, training and development. Develop and implement succession and knowledge transfer plans, preferably with leadership buy-in.
Step 5 – Evaluate effectiveness
Measure and monitor your succession planning and management efforts to ensure functionality and goal attainment. Consider assigning a process champion who will hold people accountable for tasks related to the implementation plan.
Succession planning is less about moving people into management positions and more about creating tracks that help team members develop the skills and attributes that help them grow into the next level of their careers, while helping the company meet its long-term goals.
By implementing a multi-level, leadership-focused succession plan, your organization will:
- Build a pipeline of high-quality candidates for critical positions
- Develop the competency and retention of your most valuable talent
- Offer opportunities and incentives for top talent to remain dedicated
- Avoid costly interruption of work if/when critical talent resigns
- Minimize the threat and high cost of turnover
If you would like to learn more about how to create and implement a comprehensive succession plan, click here to download our free succession planning templates below.
Download Our Free Succession Planning Templates
Are you looking for a way to find the right person to take over a position? Fill your talent pipeline? Ensure that valuable knowledge is transferred before it's lost? Or, did someone say the word, "retirement?" Our easy-to-use templates can get you started.Download Templates