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10 Tips for an Effective Succession Planning Strategy

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An effec­tive suc­ces­sion plan­ning strat­e­gy can make all the dif­fer­ence to employ­ee engage­ment, morale and your bot­tom line.

As much as we want to retain our tal­ent, as HR pro­fes­sion­als, we know that change is inevitable. Peo­ple move on; cir­cum­stances change and, from time to time, we need to ask peo­ple to leave. With suc­ces­sion plan­ning, we can put sol­id plans in place to ensure our com­pa­nies are not left in the lurch.

What Is Tal­ent and Suc­ces­sion Planning?

Suc­ces­sion plan­ning is a tal­ent man­age­ment strat­e­gy that helps to cul­ti­vate a pool of tal­ent­ed employ­ees. Done cor­rect­ly, com­pa­nies can have a queue of poten­tial suc­ces­sors poised to take the reins should one of your team mem­bers leave unexpectedly.

Suc­ces­sion Plan­ning and Employ­ee Engagement

Most mod­ern busi­ness­es empha­sise employ­ee engage­ment and employ­ee expe­ri­ence — for good rea­sons. Your employ­ees need to be enthu­si­as­tic about their work. They need to know they are part of a team and that they are val­ued. When your employ­ees become dis­il­lu­sioned and demo­ti­vat­ed, they come to work and put in the hours need­ed — noth­ing more. Work mere­ly becomes a means to get paid — they get no sense of intrin­sic reward from their careers.

Wise organ­i­sa­tions know that to tru­ly engage employ­ees, they need to invest in their pro­fes­sion­al growth. Employ­ees need to see a promis­ing future at your com­pa­ny, and man­agers need to show that this is what they want, too. A suc­ces­sion plan­ning strat­e­gy is a great way to demon­strate a company’s com­mit­ment to its work­force. But it has to be more than just words. Employ­ees need a clear vision and idea as to how they will progress and devel­op at your com­pa­ny. This is where tal­ent and suc­ces­sion plan­ning comes in.

Why Is a Suc­ces­sion Plan­ning Strat­e­gy Impor­tant for Busi­ness Success?

A suc­ces­sion plan is a wise deci­sion from an employ­ee engage­ment per­spec­tive, but a for­mal process can also save your busi­ness a lot of mon­ey. Pro­mot­ing from with­in comes with a lot of ben­e­fits. Your exist­ing employ­ees are already famil­iar with your process­es, val­ues and cul­ture. And because you have tracked their progress, skills and poten­tial through reg­u­lar coach­ing con­ver­sa­tions, it’s unlike­ly you’ll face any unpleas­ant surprises.

It has also been shown that inter­nal can­di­dates gen­er­al­ly see more suc­cess with­in the com­pa­ny when com­pared to exter­nal hires. Accord­ing to one study, exter­nal hires are 61% more like­ly to be let go or fired with­in two years and 21% are more like­ly to leave the job vol­un­tar­i­ly when com­pared to some­one who was pro­mot­ed internally.

Suc­ces­sion Plan­ning Strat­e­gy Tips

But how do you ensure your tal­ent and suc­ces­sion plan­ning strat­e­gy is as effec­tive as pos­si­ble? How do you find the right high-poten­tial employ­ees and cre­ate tal­ent pools that will ensure your com­pa­ny’s suc­cess for years to come? Below are our 10 tips to ensure a suc­cess­ful suc­ces­sion plan­ning process.

1. Acknowl­edge That There Are No Such Things as Key Roles’ — Every Employ­ee is Important

When you think suc­ces­sion strat­e­gy”, your imme­di­ate thoughts are prob­a­bly busi­ness lead­ers and C‑Suite execs. But the first thing you should know about suc­ces­sion plan­ning is that there are no such things as crit­i­cal roles”. Every­one employed at your organ­i­sa­tion should be con­sid­ered a key per­son”. Cer­tain­ly, lead­er­ship posi­tions are impor­tant to con­sid­er, but it would be wrong (and, in fact, a huge risk) to focus only on senior management. 

A robust suc­ces­sion plan­ning strat­e­gy should span the whole organ­i­sa­tion. You might want to start with lead­er­ship roles but remem­ber: a suc­ces­sion plan ulti­mate­ly cre­ates a domi­no effect. If you pro­mote Ben to replace Shan­non, you will need a third employ­ee in mind to take over from Ben. Con­sid­er­a­tions like this mean that suc­ces­sion plan­ning can take a lot of time, but it’s worth the invest­ment in the long run.

Map the tal­ent capa­bil­i­ties with­in the com­pa­ny — as well as the tal­ent gaps. Iden­ti­fy employ­ees you believe to be poten­tial lead­ers and don’t make assump­tions. Take the time to talk to employ­ees and explore their vision in terms of future roles. This will help you deter­mine whether employ­ees are with you for the short term or if you can rely on them to be with you for the long haul.

2. Be Aware of (and Let Go of) Per­son­al Bias

Don’t make the mis­take of going for the obvi­ous choice”. Be aware that you are human and, as such, you are sub­ject to cer­tain bias­es. Con­sid­er whether the front run­ners for cer­tain posi­tions have been select­ed for the right rea­sons or due to the halo effect, and don’t dis­re­gard oth­er promis­ing employ­ees because of some­one you per­ceive to be a nat­ur­al and obvi­ous suc­ces­sor. Regard­less of their cur­rent title, look for employ­ees who dis­play the skills and atti­tude nec­es­sary for the role.

3. Com­mu­ni­cat­ing Suc­ces­sion Plan­ning to Employ­ees — Keep Employ­ees in the Loop

As with most aspects of busi­ness, com­mu­ni­ca­tion makes the suc­ces­sion plan­ning strat­e­gy much smoother. Once you have iden­ti­fied a suc­ces­sor for a giv­en posi­tion at your com­pa­ny, con­sid­er shar­ing your plans. Accord­ing to research, around 25% of employ­ees in line to take over in a small busi­ness don’t know they have been chosen.

Con­sid­er what this might mean — an employ­ee might believe he or she has no real future at your com­pa­ny and so might make plans else­where. When they hand in their notice, it’s too late to tell them you had plans for them. 

Be sure to inform the iden­ti­fied suc­ces­sor that they are a poten­tial can­di­date or have been ear­marked for a future role (with­out mak­ing an out­right promise). Take this oppor­tu­ni­ty to deter­mine if the employ­ee is inter­est­ed; they might be con­tent with their cur­rent posi­tion. On the oth­er hand, know­ing you see real promise in them might make them feel val­ued, result­ing in even greater engagement.

4. Ensure Employ­ees Know What’s Required of Them to Advance

Once you have informed an employ­ee that you believe they have great poten­tial, the hard work begins — for the employ­ee. Work with them to out­line a plan that will help them devel­op their skills and strengths. Iden­ti­fy where they need to improve and what the com­pa­ny can do to help them. Be sure to meet reg­u­lar­ly with your employ­ees to track their progress and give them a clear idea of what is required of them.

5. Pro­vide Train­ing and Development

A high per­former doesn’t nec­es­sar­i­ly have the skills required to lead a team. Be dili­gent about pro­vid­ing the right tools, train­ing and devel­op­ment to nur­ture lead­er­ship qual­i­ties. This way, you will have a well-round­ed, strong leader in place before they actu­al­ly step up to the posi­tion. Be a coach to your employ­ees and pro­vide them with the sup­port they need to succeed.

6. Keep the Selec­tion Process Fair

The last thing you want is to earn a rep­u­ta­tion as an unfair employ­er. You might have a sol­id suc­ces­sion plan in place, but if your employ­ees feel favouritism is at play, or that a cer­tain per­son has been hand­ed a role on a sil­ver plat­ter, morale may suffer.

Before actu­al­ly pro­mot­ing an employ­ee, announce the vacan­cy inter­nal­ly. This will allow oth­er team mem­bers to put them­selves for­ward. Through this process, you might find some­one more suit­ed to the role — it’s bet­ter to know now and shake up your suc­ces­sion plan than to offer the pro­mo­tion to the wrong employ­ee sim­ply because you want to stick to your plan.

7. Don’t Equate Top Per­form­ers with High Potential

This can be a hard con­cept to grasp, but top per­form­ers aren’t always employ­ees with high poten­tial. When cre­at­ing your plan, remem­ber high per­for­mance in one area does­n’t always mean they have man­age­ment or lead­er­ship poten­tial. Accord­ing to one source, only 15% of high per­form­ers are also like­ly to be effec­tive lead­ers. One does not always guar­an­tee the other. 

Rather than only look­ing at top per­form­ers, take a minute to con­sid­er your oth­er employ­ees — the ones who aren’t always at the top of their game but have a nat­ur­al abil­i­ty to moti­vate and inspire oth­ers. Look for employ­ees who keep try­ing and look for cre­ative solu­tions to com­pli­cat­ed problems. 

8. Under­stand You Will Encounter Resis­tance and Upset

It’s high­ly like­ly that your suc­ces­sion plan, when com­mu­ni­cat­ed or revealed, won’t be pop­u­lar with every­one. Some employ­ees will feel over­looked and some will thor­ough­ly dis­agree with cer­tain deci­sions or cer­tain peo­ple being pro­mot­ed to a giv­en posi­tion. Expect a degree of resis­tance or upset, but make sure your door is open. It’s best that employ­ees come to you to air their griev­ances rather than let­ting these feel­ings fester.

9. As with So Many Process­es in Per­for­mance Man­age­ment, Flex­i­bil­i­ty Is Key

As touched on in point six, your suc­ces­sion plan shouldn’t be carved in stone. Remain flex­i­ble — no con­tracts have been exchanged and there are no cer­tain­ties in busi­ness. While hav­ing a suc­ces­sion plan in place is an effec­tive strat­e­gy, and one that will put your mind at ease, cir­cum­stances may force your hand. If an employee’s per­for­mance suf­fers, you might need to recon­sid­er the plan. If a new employ­ee joins the com­pa­ny and you see lots of promise in them, you might want to make changes. Just remem­ber to be fair and respect­ful of every­one involved and nev­er make promis­es you can’t keep.

10. Reg­u­lar­ly Review Your Suc­ces­sion Plan

An effec­tive suc­ces­sion plan­ning strat­e­gy is not a one-off task. Mod­ern busi­ness­es are agile and we live in a fast-paced busi­ness envi­ron­ment, so you should reg­u­lar­ly dis­cuss and re-eval­u­ate your strat­e­gy. Sched­ule fixed times in the year to revis­it your suc­ces­sion plan and deter­mine whether it still works. Doing this reg­u­lar­ly will save you time and frus­tra­tion in the long run.

Are you look­ing to boost lev­els of employ­ee engage­ment at your com­pa­ny? Check out our employ­ee engage­ment soft­ware, designed by HR pro­fes­sion­als to improve per­for­mance and wellbeing.