HR Tech – Is succession planning in your organisation in place?
Succession planning refers to the process of recruiting new talent, equipping them with skills and training them for career advancements to fill in the vacant positions. It is an ongoing process that aligns organisational goals with that of employees and helps in preparing a futuristic cadre of able leadership in the organisation.
According to a Harvard Business Survey, 63% of private firms do not have a contingency plan for CEO succession while 54% lack effective CEO successor planning.
The need for succession planning arises due to incidences such as superannuation, resignation, promotion, or diversification of employees.
Although large organisations are warming up to the concept, the need for succession planning is more acute in startups because when the board of directors is small, they need to brainstorm more effectively on contingency plans and delegation of responsibilities if succession exigency arises.
A TJinsite survey highlights that 30% of organisations believe that succession planning can address a high attrition rate and encourage high employee retention. Moreover, 20% admitted that a proper succession planning strategy reduces anxiety among employees and empowers them.
The COVID-19 pandemic has further underscored the need for robust contingency planning and continuous revaluation of top leadership amid a dynamic and uncertain economic environment.
Make a beginning through short-term back-up plans
Companies’ boards need to know the suitable candidate who can take charge of affairs in the absence of the CEO. They should objectively assess the CEO’s impact and contribution to the company.
Directors should prepare a list for potential candidates who can function as interim CEO by mapping their skills and expertise and aligning them to organisational goals.
Similarly, there should be a succession plan for each managerial level. This process takes into account various factors of employees' attributes such as mobility, age, medical history, performance and potential assessments, peer feedback, training history, flight assessment, career aspiration surveys, readiness assessment and much more depending on the organisation's policies and preferences.
The role of the HR function is significant in this regard for identifying talent back-up from a comprehensive database and preparing them for the future. The candidate next in the hierarchy does not need to be the obvious successor. Promising candidates with similar expertise and skillsets should be given equal weightage.
Keep the prospects in the loop
The candidates being considered for leadership roles in the future must be made subtly aware of the development by taking cognisance of their achievements or one-to-one discussion with them. At the same time, it is necessary to inform them that succession plans are subject to change by either the company or employees themselves.
Step up Learning and Development efforts
An effective succession planning strategy also necessitates investment in employees’ development. Along with learning and development, job rotation and integrated executive programs and mentorship are useful tools in succession planning.
Integrate succession planning with talent management and hiring process
Succession planning and talent management are closely related processes. Talent management implies shaping of the career trajectory of employees. Succession planning arises due to the necessity to fill vacant roles for which suitable candidates need to be identified and nurtured.
It is prudent to integrate succession planning with talent management practices to ensure high employee retention and mitigate uncertainty. Once the candidates have been identified for assuming leadership roles in the future, it is also necessary to identify talent gaps and fill them through hiring suitable candidates.
Measure outcomes rather than the process
Succession planning strategies should be measured from the perspective of the result achieved. For instance, crucial vacancies filled through internal promotion or external search, the proportion of promotions of high-performers and so on. Process measurements such as the number of existing succession programs or policies do not need to be measured.
Leverage technology to facilitate better outcomes
Technology is a great enabler to institute a proper succession planning framework. The comprehensive hire-to retire solutions help to convert volumes of employee and organisational data into strategic insights to equip the HR function to take a holistic and objective view on the performance and potential of employees.
Technology also facilitates the convergence of numerous assets such as learning and development, performance management tools and succession planning tools into a common platform to facilitate informed decision-making invariably linked to improved outcomes.
A comprehensive technology-driven succession planning culture must be embedded within the organisation structure to boost employee productivity, encourage their retention, mitigate risks and uncertainty and ensure cost-efficiency.
This implies an all-encompassing role of the HR function in identifying and sourcing talent, augmenting L&D efforts, identifying business-critical roles as well as top performers and complementing the top leadership in mapping employees' performance and potential.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)