CoAdvantage – Many companies recognize that succession planning is a vital part of their organizational success. But, despite the importance of having the right leaders, many struggle with it. Research from Deloitte has found a major gap between succession planning efforts and outcomes: 86% of leaders say it is “urgent” or “important” but only 14% believe they do it well. It can be even worse at small businesses, where preparing for tomorrow’s needs can easily take a backseat to deal with today’s problems.
Specifically, we’re talking about creating short- and long-term contingency plans for replacing personnel who quit, retire, die, or otherwise leave the organization. This is important at all levels of the organization, but it’s absolutely critical for leadership roles. You don’t want to wait until someone is already gone. “Then the company is operating in a crisis situation, which leads to poor decisions,” Mary Kelly, chief executive officer of Productive Leaders and co-author of Who Comes Next? Leadership Succession Planning Made Easy told the Society for Human Resource Management (SHRM).
Succession planning is critical for ongoing organizational success.
– Without effective succession planning, the loss of key personnel will leave the company scrambling to try to maintain business operations at previous levels. The more important the person, the greater the risk.
-You may have leadership vacuums that are difficult or slow to fill after people leave or retire.
-You may have work that simply doesn’t get done because there’s no one to do it.
-You may lose institutional knowledge because a key player left without training someone to succeed them.
-Succession planning can also offer some secondary benefits as well:
-It preserves institutional knowledge.
-It creates avenues for promotion and career development for existing employees.
-It ensures the continuity of business operations.
Succession planning is a multilayered process.
Layer 1: Internal recruitment. One key element is making sure you already have someone ready to step into another person’s shoes, even if it’s only temporary. This means creating internal pathways for career advancement that offer employees opportunities to perform the same or similar tasks as the person they might be replacing or filling in for.
Layer 2: Mentoring. Related to the above, it’s a good idea to have key personnel mentor others in the work that they do. This is a great way to share institutional knowledge and help cross-train existing personnel on critical tasks.
Layer 3: External recruitment. Sometimes it may not be possible to fill a vacant role internally. It’s possible no one already at the company has the skill sets, connections, or other necessary resources to replicate the work performed by the previous person. Make sure you have effective recruitment channels and strategies for workers at all levels, including executive and leadership roles.
Layer 4: Training. When we normally talk about succession planning, we’re focused on replacing specific roles within a company, like a C-level position. But sometimes you just need to make sure you have someone with the right skills to take over specific tasks. Provide training opportunities for critical skillsets so you always have people who can perform critical tasks as needed.
CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with HR administration, benefits, payroll, and compliance. To learn more about our ability to create a strategic HR function in your business that drives business growth potential, contact us today.