85% of CEOs believe a diverse workforce improves company performance and profitability. Additionally, they report benefits…
Of the many “what ifs” in running an organization, employee development and turnover have a significant impact, especially to human resources.
A lot can happen when employees leave a company—unrest, low morale, uncertainty. And when key executives, like members of a C-Suite, unexpectedly leave an organization, chaos and power struggles may ensue. If the vacancy is made by someone who held key knowledge that is now lost, the impact could be much worse.
Life happens, and whether it’s retirement or an unplanned emergency, it’s critical for organizations to have a succession planning strategy prepared for when a critical employee leaves their job.
What is succession planning?
Succession planning, essentially, is having a strategy in place for when your top executives retire or leave your company. It’s a way to plan for both expected and unexpected departures of senior staff, and aims to ensure no significant expertise or leadership is lost upon their departure. Effective succession planning diminishes harmful impact in both time and resources to your organization.
A key aspect of succession planning is identifying your high-potential employees. Do they seem like they’d be a good fit to be groomed for leadership roles? If so, develop a training plan to evaluate and nurture their skills. When it’s time for that transition, you’ll have the next generation of leaders prepared to forge ahead.
The benefits of succession planning
Besides being a key safeguard for unexpected circumstances, succession planning is also an excellent professional development opportunity for high performing employees. The process allows them to learn and grow with the organization as they train for future roles.
For organizations, diversification is a huge benefit to having a succession planning strategy in place. By bringing new employees into the fold, you’re able to bring their unique perspectives and experiences into the decision making process as well. This will help your business evolve. Additionally, succession planning helps to provide stability, boost morale, and avoid costly extended vacancies that can occur in key positions throughout the organization.
3 approaches to effective succession planning
1. Look at both the performance and potential of current employees
It seems like the easiest choice to identify candidates for succession planning by looking at your current top ranking, high performing employees. The benefits to this are clear and cost effective—you can target your resources and time on developing employees who have demonstrated the skills and abilities to lead.
However, make sure your process for evaluating talent in your organization looks at other factors besides those who are performing highly. There may be certain employees who would flourish in a robust training program and add diversity to your leadership. Current performance isn’t always an indicator of future performance, and that’s why you should test for potential. Once those employees are identified, you’ll get a clearer sense of how to leverage resources to best help them grow, converting that potential into performance.
2. Determine if you need to look outside your organization
In many cases, the candidates who already work for you are the ideal choice. They’ve grown at your company, may have built up some loyalty to you, and are less likely to leave. They’re also less costly to train and develop, as they’re already familiar with the nuts and bolts of how your organization is run.
However, it may also be possible that your organization wants to head into a different direction that isn’t available with the current talent pool. Or, maybe the current talent pool just isn’t ready to jump into that executive role quite yet (especially if you’re replacing an employee who left due to unforeseen circumstances). In that case, consider looking outside your organization.
3. Ensure that your Human Resources department has support from the current leadership
Current leadership is crucial to the success of your succession planning strategy. Without buy-in from the top down, it’s difficult to move forward. Communication and education on succession planning is key. As an HR leader, you won’t be able to effectively navigate and execute meaningful planning without creating a culture that supports that vision.
This starts at the top. The plan needs to be aligned with both short-term and long-term business goals, with flexibility and adaptability built in. That’s why you need leadership support. Think about your larger succession planning goals when conducting performance investments; make succession planning a part of employee engagement initiatives; align planning with your recruitment approach, training and development methods, and performance reviews.
Begin developing your plan
There are no rigid rules as to how and when you should begin succession planning—you should instead adapt to the changing necessities of your organization, from current priorities to future needs. Delineate the key positions and the skills and abilities required in those crucial roles; think about what’s needed for future roles that may not now exist but will as your company transforms. Understand how long it will take you to get someone up to speed and confidently placed in a role. Talk to leadership and employees alike! Listen to potential candidates about what they desire in a career path and in their long term professional growth. Design a training program that is in alignment all those things. Test out this plan and make it adaptable to feedback or changes. Identify and assess any potential obstacles. Ensure the leadership team is on board, reassess regularly, and make adjustments.
Remember, this process isn’t static! It should be reviewed periodically and adjusted as necessary to best serve the needs of the business. But by having this plan in place, you’re one step closer to effectively managing any future transitions with ease and efficiency.
Do you need support in identifying and hiring experienced candidates? Reach out to one of VanderHouwen’s account managers.