Introduction to Succession Planning
Succession planning is a systematic approach to building a talent pipeline to ensure leadership continuity and company success. Succession planning recognizes that some high-level jobs are too critical to be left vacant or filled by any but the best. Crucial to a company’s success during a transition, succession planning is an effective process for recognizing, developing, and retaining top leadership talent.
Developing a Succession Plan
Developing a succession plan involves a methodical and strategic approach with five phases. It is typical for a company to engage in succession planning once a year, but to conduct ongoing grooming and monitoring of all potential successor candidates.
- Analysis & Assessment
The analysis and assessment phase involves looking at the big picture to understand the challenges of the executive team, the company and the entire industry for the next five to ten years. Analysis and assessment also includes determining which skills and which specific expertise will be required of the successor.
- Talent Identification
Focusing first on internal candidates, development begins with identifying potential replacements. The search for external candidates is more time-consuming and can be facilitated by an executive search firm. Engaging with potential candidates is necessary as well. How do the possible candidates measure up against the required competencies? What might help them develop competencies that are underdeveloped?
- Talent Selection
Each company handles the selection process in its own way. For CEO positions, candidates should be invited to outline and present their vision for the company's next five years – perhaps in a formal presentation and discussion with the board. For lower profile positions, candidates may engage in less formal discussions and debates with various stakeholders in the selection process.
- Training and Grooming
Once you determine which employees are candidates as successors, you should create a means of regular, ongoing development planning. After determining existing gaps through performance assessment, ongoing development planning will narrow those gaps and help employees prepare for the future. Managers should develop plans with their employees to prepare them for future positions. Plans could include coaching sessions, books or periodicals to read, classes to attend, or project-based goals that build competence in new areas.
- Measuring and Monitoring Performance
In order to hold employees accountable for closing developmental gaps, managers need to schedule progress meetings and set incentives (financial or otherwise). The objective of the meetings is to track progress performance on stated goals.
Succession Planning Tools
Many organizations rely on software systems to help automate the process of selecting and evaluating successors for various roles. An enormous amount of data is required, some qualitative and some quantitative, to evaluate potential successors. Relevant data can include readiness factors, competency level, tenure and education level, as well as previous roles in the organization.
Single purpose succession planning solutions can often be costly and unwieldy to implement because they rely on detailed evaluations of all positions and employees. While valuable, they are often too complex for resource-strapped organizations to manage. Simple lightweight solutions (such as software that ties in with your org chart) also exist to support your talent management efforts, and rely on qualitative firsthand knowledge held by managers.
Whether you can invest in a robust exhaustive solution or a more practical succession planning tool, you will want a system with the following functionality:
- Visual, drag-and-drop features
- Integration with your HRIS data with links to competencies and other qualifications
- Easy interactive ways or to assess employee potential, flight risk and impact of loss
- Search capability based on multiple filters and employee characteristics
- Multiple views of succession plan, including organizational charts with concern areas highlighted
- Informative visual reports and dashboard
- Easy way to see employees close to retirement and appropriate, pre-defined successors
- Ability to model different succession scenarios
- Display of other relevant data, such as successor readiness, tenure and education level, as well as previous roles in the organization
- Ability to rank successors for key positions based on competency level, readiness factors and educational background
- Collaboration with other users
- Control over who can create, edit or view any given succession plan
- Built in “9 box” performance/potential grid for evaluation of successors