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A succession plan focuses on identifying potential leaders and top performers to help them advance within the company. It is also more cost-effective to develop current personnel for key roles jobs rather than recruit new individuals. Unfortunately, many firms fail to prioritize succession planning, preferring to concentrate on corporate growth rather than employee development.
Promoting individuals from inside the company to fill positions vacated by prior leaders with talented personnel who are already familiar with your organization is a practical approach to business continuity. Additionally, a succession plan also tries to lower the turnover rate of your company. If a company acknowledges a valuable employee’s leadership potential and allows them to advance in their career, they are less likely to leave.
However, only focusing on one successor might lead to complications if that person does not want the job or decides to quit the organization, so enlist the support of hiring managers or corporate leaders to identify a few candidates.
Ensuring that the appropriate people are in charge decreases turnover by giving the rest of your team a lift in morale. It’s reassuring to know that the company is still in capable hands. Employees are frequently good at identifying red flags within a company, and they’ll be more compelled to leave if there are indicators of leadership issues. Developing succession plans is similar to purchasing business insurance in case of an emergency, only it also entails training personnel to become leaders in the future.
At its core, an effective succession plan should assist a company in selecting and developing the right people for leadership positions. Managers have the power to make or break a team’s dynamic and performance, so identifying the right people is crucial for long-term success. Organizations can gain several advantages when they take the time to design a formal, comprehensive succession plan that includes filling leadership positions with exceptional individuals.
While each organization’s succession plan may differ, most succession plans should include the following:
☐ Define Objectives
Your plan should address the succession plan’s end goal, such as helping people gain more knowledge, refine management skills, and retain company knowledge.
☐ Establish the Succession Plan Type
Death and exit successions are the most common. Death succession is when a leader or owner passes away unexpectedly, leaving a power vacuum. It will aid management and staff in determining who should be in charge while everything is sorted out. Exit succession assists in transferring leadership positions in a defined timeline. It could also define the schedule for a leader to stand down fully or remain involved in a reduced position.
☐ Set a Clear Timeline
Knowing how long employee growth will take will assist your organization connect the succession strategy when new roles and transitions are required.
☐ Allocate a Budget
Determine how the cost and resources needed for an effective succession plan as it will also influence other aspects of the company’s strategy.
☐ Details of Leadership Transition
If you’re grooming personnel for a career in management, the plan should outline how leadership or ownership will be transferred and how future business decisions will be made.
☐ Identify Potential Leaders
Evaluate which employees can be significant actors and assess the skills and training program they require.
☐ Match Talent with Job Roles
Job development necessitates that current employees are suited for tasks and leadership positions. Individual abilities must be matched with essential roles. A job analysis can identify the knowledge, skills, and capabilities required for each position.
☐ Support New Leaders
It is important to include how the succession plan will be supported so that the successor has access to whatever resources they need (e.g., who to report to if a key individual is incapacitated).
☐ Training and Skills Development
The process of defining relevant skill sets and competencies for important positions has the added benefit of identifying skill gaps and training needs in the existing workforce.
Human resources understand job design concepts, effective performance management methods, and training efforts. They are equipped to help in career development and workforce analysis as well as promote a receptive organizational culture that adapts to change with a learning mentality.
Although leadership changes may occasionally result in employee attrition, HR methods for retaining talent should be part of the succession plan. It circles back to developing a compelling Employee Value Proposition and Employer Brand.
Collecting and managing employee records for succession planning can be difficult across multiple teams, business units, or even geographic boundaries. KRIS Document Management System (DMS) is a secure, centralized portal that stores and manages information related to performance, assessments, employee feedback, and training activities.
Accurate record-keeping ensures you can leverage data to make the right decisions for employee growth. Succession planning is a dynamic process that should be annually revised, so it remains relevant to the company’s objectives and employees’ progress.