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.
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