Would you build a home without a floor plan? Start a road trip without a map or destination? Coach a team without any planned plays? No way! Then why would you run a company without a succession plan in place?
Succession planning is a key element that every business should have. Succession planning identifies job vacancies that can be expected to occur through retirement or promotion and the strategy for how internal candidates can fill these positions. What skills and development are needed for existing employees to be qualified for these positions? What gaps need to be filled through mentoring or training development?
Succession planning can also help management identify future leaders. When each employee is put on a pathway for each position, it becomes simple to see the large picture and know where the company’s gaps and opportunities are. There are several reasons companies have succession plans, but one of the top reasons is the possibility of unplanned changes.
What if your manager or CEO suddenly was unable to fulfill their duties or passed away? Would your company be ready? Is there someone next in line who is somewhat familiar with the responsibilities? Is there a plan in place?
A business is never stagnant — employees constantly shift into new roles, take leave or find new jobs elsewhere. With any change, it’s up to the remaining staffers to fill the gaps or find someone else who can.
Of course, when this type of event happens, you don’t want to be left scrambling for a new candidate or internal hire! Any delay where a key position is left empty can lead to severe losses for the company. A succession plan will help you keep a talented workforce on hand always — all it requires is a bit of foresight on your part.
Not only will succession planning prepare your company for unexpected changes, but it also has a lot of growth-inspiring benefits for your employees. A clearly established plan will increase their motivation and sense of purpose because they will know what the next position up the line is, and they will understand what skills are required to prepare for progression within the company.
When making your plan, here are five factors to consider:
1. What Type of Plan Do You Need?
Every business’ succession plan will vary. To draw up one that works for your company, you need to first consider what you want it to accomplish. Do you know key players will be leaving for new ventures soon? Or, do you simply want to be prepared in case an unexpected event takes leaders away from the office for an extended period? Your succession plan could also help workers obtain new skills if the business goes in a different direction. Patricia Carl, President of Highland Performance Solutions says,
“Organizations should have succession plans in place for all key roles. This typically includes the C suite and other executives, but could also include hard-to-fill positions, which require a unique or market-scarce skill set. The plan should be documented, along with the appropriate development actions required to ready the successors.”
Before drawing up any succession plan, you must consider these questions to make the entire process that follows easier. Having an idea of what’s to come will help you move onto the next steps. You may have to bring in an expert to create these plans to determine what’s required for the changing of hands to take place seamlessly. Lawyers and coaches aren’t just needed for business successors, they’re also critical in the transition and succession of leadership and how compensation packages will work.
Dedicate someone within HR or another manager to take the helm and make plans. Ensure each senior leader or manager has a succession plan within their team. Also task each leader of each department to plan pathways and succession plans for each employee on their team by answering questions like:
Who will be their successor?
What promotional paths are in place?
What training needs to occur?
This will not only help you develop a plan for emergencies but also plan for growth while keeping training development in line with individual employee goals.
This plan will also help your employees to feel more confident and secure. If they know what lies ahead for their future career they will most likely be more motivated to hit goals and exceed expectations. It also boosts morale because, after all, who wants to be the marketing intern forever?
You should review these plans periodically which will help supervisors stay current on employee’s skills and achievements as well as keeping everyone in the loop of upcoming growth opportunities or places where improvements can happen. If you are a supervisor training a potential successor it’s important to break up the training over weeks, months, sometimes years. This shouldn’t be a day training.
A healthy work-life balance should also be part of this plan. It’s a great opportunity when key leaders can step away from the office, away from email for a few days or even weeks so that the office can maintain productivity and run smoothly.
As a leader, you should be thinking about what other key members would you prefer to not see leave the office? These are team members that should have succession plans, who is covering them if for some reason they are gone? What protocols are in place?
2. Is it a Person- or Position-Based Plan?
Succession planning in your company could home in on one specific employee who has the skills and capabilities to fill a more integral role in the future. Or, succession planning could pinpoint the roles that best prepare staffers for the next steps in their careers.
It’s a lot easier to build a person-based succession plan because you can quickly point out who has the qualities required for a promotion. They must be open to change and able to pick up new skills rapidly since they might be on a trajectory that’ll include more than one managerial or leadership role down the line.
Position-based planning requires a bit more insight into the industry in general and, more importantly, the business's organizational structure itself. You’ll have to decide which jobs are unique to the organization — those are the ones that should absolutely have succession plans in place. High-ranking positions or those that require experiential, on-the-job training should also be in focus, too. Ultimately, you’ll have to use your internal knowledge of the business to create a position-based plan.
Your succession plan doesn’t have to focus on specific employees or roles. In fact, the best programs include a step-by-step guide for how to handle both types of situations. It’s up to you to decide what areas or employees would be best served by this type of planning.
3. Who Will Make the Decisions?
Some employees are better candidates than others to be part of the succession plan implementation team. Think about it: Who knows what’s required of potential hires for these positions?
The most obvious choice is the CHRO and human resources team which is responsible for hiring employees. Even with internal hires and successors, they should be able to pinpoint the qualities required of those in managerial roles.
Company leaders might be able to choose the next in line, too. This is especially true for businesses that have implemented mentoring or internal training programs, in which employees shadow and learn new skills from those in different roles and departments. A mentor might be able to definitively say who has the right attitude and aptitude to take over in the short or long term.
Department heads and leaders can meet together often to bring up employees they feel have the potential to be leaders. From there more milestones, training or opportunities can be added to that particular employee’s path so that they are given the chance to grow.
This is also a great time to look at your leaderboard. Are there any skill overlaps? Make note, this can be something that is planned for multiple people to share the responsibility until a better candidate can be moved into place. This can also help some leaders develop or hone skills that have potential but aren’t quite up to par yet.
Although most companies strive for internal hiring first keep a firm plan for developing an external pipeline if needed. This keeps your talent up to speed with the industry and ensures you are keeping touch with what’s going on in the market. It’s also a great way to keep in touch with potential candidates who could be successful in your company culture and future positions.
Leaders are constantly thinking about their company’s growth and current employee makeup. From interns, to board members most founders or CEOs are thinking about how they can better develop their employees, how to keep growth coming, how to keep their talent pool growing and getting better and better.
Creating pathways and plans for each position in a company and each employee is a great way to get a bird's eye view of your company. What employees are being overlooked for leadership roles, what new development tactics should be deployed, what challenges can teams take on. These are all questions that can be answered once pathways are established and tied to a succession plan.
Career progressions should be integrated into your succession plan and pathway for every role. What milestones, goals or skills are needed to get to the next step? Improve your growth and support employee’s career aspirations at the same time. This will keep your employees engaged and performing well. It will also help keep costs down by increasing your internal hiring practices.
5. How Will We Gauge Success?
There’s no one-size-fits-all evaluation method of a succession plan. Instead, every business will have to come up with a way to measure how well they’re doing. Perhaps it’s all about how the employees feel as they move their way up the ladder: If they’re happy with their professional development, the program is working.
Managers might also have a say: Are they satisfied with the employees who have been pushed forward by the succession plan? If the restructured staff has reached the company’s goals, that’s a good sign, too.
Of course, not every plan will be perfect from the start. The implementation team should be ready to reconfigure their envisioned succession should it cause more positives than negatives. This is also an area to revisit regularly — as the company changes, so should the way employees move onward and upward.
Jennifer Yugo, Managing Director of Corvirtus suggests that you
“Start measuring success by first having a definition of what success looks like. Leaders championing the succession plan should agree on observable metrics. This could include rate of progression by position/role, retention, and observable business metrics.”
It’s Worth the Effort!
Despite all the steps you take to make it simpler, there are always going to be difficulties when it comes to succession planning. Some might experience a lack of support from their higher-ups, while other businesses lack the organizational structure it takes for viable candidates to feed into the next, more demanding role.
But working through all the negatives and coming up with a succession plan that works will eventually be a great benefit to everyone who works with you. Not only will they have the chance to move forward when the right position becomes available, but they’ll flourish in a stable work environment where there’s always a solution at the ready when something unexpected happens. That type of satisfaction will keep people around longer, thus fulfilling the aim of the succession plan in the workplace. All that’s left to do is start brainstorming.
For more information about how Succession Planning can benefit your company, setup a meeting with one of our specialists for a free consultation!
Sarah Landrum is a millennial workplace expert and the founder of career and happiness blog, Punched Clocks.