One of the major concerns in strategic planning for any organization is to have good Succession planning to ensure that the organization will move in the right direction to achieve objectives and also continue the legacy of the founders. Succession planning drives company leadership development process and it assumes equal weights along with the strategic plan. However many people from CEO to the lower level managers consider the word "succession Planning" a taboo. Planning your exit is like scheduling your own funeral, and it evokes fears and emotions long hidden under layers of defense mechanisms and imperceptible habits. Many executives believe that leadership development is a job for the Human Resource department. This is one of the major misconceptions that managers can have. Succession planning should happen at all levels of management to ensure smooth functioning of the organization at all times.
In UAE context we have many business which are family run and there are many medium and small enterprises which continue to leave succession planning to chance in spite of knowing its importance. Succession planning in simple terms consist of selecting a successor, which includes identifying the potential successors, developing the criteria for selection, and designating the successor, communicating the decision, training the successor, developing the successor and defining the departing leaders role after succession if any. These steps need not be sequential and some can be performed simultaneously. Failure to plan for orderly business succession can result in both monetary losses and even closure of business.
In reality companies that are good at growing leaders like GE, senior managers are at the fore front of succession planning and leadership development. It is part of the manager's job to recognize subordinate's developmental needs, to help cultivate new skills and to provide them with opportunities for professional development and personal growth. One of the roles of manger is to mentor emerging leaders, from their own and other departments, passing on important knowledge and providing helpful evaluation and feedback during the process. In addition manager's own evaluation, development plans and promotions in turn depend on how successfully they nurture their subordinates.
Two important requirements for the succession planning to be successful at the workplace are one, the involvement of the board / directors/ founder/ CEO who will have to spend time to get to know the rising stars, and gauge the efficacy of the leadership. Second key requirement is creating a culture within the organization where all senior managers and head of the units share upcoming junior managers with other units. In this way the rising future leaders will gain exposure to the company's operations and also experience how various units collaborate and execute the strategy. Cross functional assignments also provide opportunities to master new business challenges.
Succession planning can be proactive and reactive. A proactive one is when people move into different areas for experience and training before they occupy key positions. Reactive succession planning is when the organizations frantically searches for appropriate candidate at the last second and end up either experiencing a steady attrition in talent or retaining people with outdated skills or promoting mediocre employees and end up low performing units.
Some companies however have not only recognized the importance of including succession planning and leadership development on the board's agenda but also have taken steps to ensure that those items get the due attention to deliberate and take it forward. A proper succession planning not only provides stability to an organization to have a longer life span but also emerges as a successful firm with steady growth. Following are some of the benefits of succession planning:
Benefits of Succession Planning
- Aligning strategic goals and human resources to enable the "right people with right attitude in the right place at the right time" to achieve desired business results
- The development of qualified pools of candidates ready to fill critical or key positions
- Providing stability in leadership and other critical positions to sustain a high-performing public service and ensure uninterrupted delivery of services and programs to New Brunswickers
- Identifying workforce that needs to be retained and targeting necessary employee training and development
- Helping individuals realize their career plans and aspirations within the organization
- Improving employees' ability to respond to changing environmental demands, and
- The opportunity for timely corporate knowledge transfer
How to do a Succession Planning for your firm - A 5 Step Process
Step 1: Identify critical positions
Critical positions are the focus of succession planning efforts. Without these roles, the department or agency would be unable to effectively meet its business objectives. Workforce projection data or demographic analysis is essential in identifying risk areas. A risk assessment may also be conducted and compared to current and future vacancies to identify critical positions within your organization.
Step 2: Identify competencies
A clear understanding of capabilities needed for successful performance in critical positions is essential for guiding, learning and developing succession plans. Setting clear performance expectations and assessing performance follows plans. By completing the process of competency or position profiling within your organization, current and future employees gain an understanding of the key responsibilities of the position including the qualifications and behavioral and technical competencies required to perform them successfully.
Step 3: Identify succession management strategies
After identifying critical positions profiles for competencies need to be prepared, the next step is to choose from a menu of several human resource strategies, including developing internal talent pools, onboarding and recruitment to address appropriate succession planning.
Step 4: Document and implement succession plans
Once strategies have been identified, the next step is to document the strategies of succession plan into an action plan. Action Plan provides a mechanism for clearly defining timelines and roles and responsibilities.
Step 5: Evaluate Effectiveness
To ensure that the department or agency's succession planning efforts are successful, it is important to systematically monitor workforce data, evaluate activities and make necessary adjustments.
The best of succession planning programs share some common attributes. They are not stand-alone adhoc activities coordinated by the Human Resource Department, their development initiatives are embedded in every area of the business. From the board of directors, senior managers to the first level managers are deeply involved in evaluating managers and promote them mainly based on their contributions to the organization. By engaging managers and the board in this way, a company can align its succession planning process with its strategic priorities. Such coherence, identity and authenticity in succession planning makes it easier for the company to attract the future leaders it needs.
Succession planning is always an ongoing process and is never finished. On a regular basis, each organization must look at its needs and resources to determine where it needs to have successors in place or in the process of learning the requisite disciplines. Each organization also needs to determine how long a candidate should be involved or exposed to the training and development programs. The organizations should also focus on policies, procedures and practices and not on personalities. Succession planning is a matter of strong HR practices, not a matter of sudden crisis management. To be realistic succession must be planned years in advance of expected needs. To properly train a successor, the organization needs sufficient time to expose the personnel to the full spectrum of opportunities within the firm, as well as any desired or required outside education/ experience expected. Skillfully done succession planning will bring peace of mind to senior management, based on the understanding and expectations of its future leadership. Lot of time and resources are spend on succession planning to ensure that there is a smooth transition and should be integrated with the strategic plan of the organizations.
Prof. Sudhakar Kota
Dr. Ajith Kumar.V.V