Some say it’s an unfair question because while recognizing the need, most US businesses do not have a succession plan for their leadership. A Right Management Study from May 2013 determined that only 4% of businesses in this country believe they have an adequate talent pipeline to meet their future needs. In that same study fully 85% of US Executives said they “…expect to rely on a combination of internal talent development and outside recruitment. In addition, 11% U.S. organizations routinely look externally before filling critical roles.”
If I were a CEO I would be very concerned upon hearing that information. I would want to know why my company does not have a working viable succession plan.
Succession Planning is as simple as it is complex. It takes a great deal of know-how and effort. It is entirely possible that many companies, potentially as many as 96% if only 4% of businesses have an adequate talent pipeline, do not have anyone on their staff who knows how to develop a working and effective talent pipeline. This isn’t as simple as buying a technology product, plugging in some data and proclaiming “Voila, we have a succession plan.” It takes doing specific things effectively and efficiently.
Let’s first simply define a succession plan. It is nothing more than a systematic approach to filling your future talent needs. It is based on the premise that each company has jobs that cannot be left vacant and that these jobs must be filled by the very best person you can find. In that anywhere from 60% to 40% of senior level, new hires fail, external sourcing should be the last effort a company makes when replacing key players.
Effective succession planning is contingent on the following:
1) Top Leaders are directly involved in the process
2) Top leaders are held responsible for developing subordinate leaders
3) Employees are committed to their own professional growth
4) The success of the succession plan is dependent upon its alignment with both long-term enterprise needs and the strategic plan of the enterprise.
5) Succession planning requires measurement
6) Succession planning is a long-term effort.
In its simplest and therefore most effective design, a succession plan is a 6 step process. These steps are:
- Linkage of Strategic and Workforce Planning Decisions:
- Developing future needs in product or service delivery
- Aligning the planning with needs of top leaders.
- Analyzing gaps in #1
- Identifying core competencies and attributes
- Identifying current internal talent
- Developing a long-term plan and not one focused on just immediate issues
- Identifying internal talent pools
- Assess the skill and competency of current workforce
- Looking at multiple levels of the organization and not just “1 down.”
- Identifying strategies for succession
- Assess current recruiting strategies
- Assess current retention strategies
- Assess different learning/training and development strategies
- Implementation of the strategies developed in #4
- Implement effective recruiting and retention strategies
- Implement developmental strategies
- Communicate the plan and process enterprise wide
- Monitor, evaluate, change, and continue.
- Tracking progress of all participants
- Obtaining feedback and utilizing it
- Obtaining and analyzing internal feedback
- Using data to adjust and correct.
The benefits of good succession planning include:
1) A way to ensure continued service and product delivery
2) Having a sustainable talent supply who are ready to immediately step into a key role.
3) An alignment of Organizational and HR Strategy
4) A marketplace differentiator that enhances your recruiting and retention efforts.
Not having an effective succession plan undermines the ability of the business to ensure its effectiveness and long-term sustainability. Without a succession planning process that is embedded in the culture of the enterprise, the organization most likely lacks the ability to sustain its programs and services beyond the current incumbent.
Succession planning takes effort, and equally important an understanding of the process and all of its components. Unless it is done properly the experience will most likely result in the demise of the current and any future succession planning efforts.
Whether large or small, succession planning is critical if the organization expects to exist beyond its current leadership. Ensuring that sustainability is the direct responsibility of current senior leadership, and on occasion with CEO succession planning, the Board of Directors or Trustees. For profit or not for profit, large organizations or small, succession planning is a core responsibility of the Enterprises top Executives.
How well does your organization engage in succession planning?