Can Your Business Succeed Tomorrow?
Can Your Business Succeed Tomorrow?
However, statistics show that less than 15% of businesses actually do have a plan. But why? Some of the most common answers I get to this question are: it takes too much time to create a succession plan for all our critical positions; the plan changes too often with our business needs; or how likely is it to really happen anyway? But, depending on the position, the impact of a loss with no plan in place can have many affects up to and including closure of the business; loss of productivity for six months or more; turnover of other key employees; or loss of customers. If you do the cost benefit analysis, you'll probably find yourself creating a succession plan for every employee in the organization.
For now, let's stick to the critical key positions and later you can add the other positions as well. (Remember, every position in your organization affects the business or you wouldn't need the position at all). So, how do you identify what positions are the most critical to business operations? This is a job for human resources AND top management, which are probably the first positions you will have on your list as critical. Together HR and management need to evaluate all the positions to determine which positions are likely to:
-impact daily operations of the business
-have the most visibility to the customer
-be key to meeting business objectives / goals
-be very difficult to replace in this marketplace
Once you have your positions identified, you are ready to begin developing the plan. There are four basic components that I recommend your plan include:
1. Profile of the position(s)
2. Identification of successors
3. Plan to prepare the successors
4. Identification of other HR implications
Component 1: Profile of the position(s)
You will need to develop a detailed profile for each of the identified positions which should include key responsibilities, education, skills, experience, and any other needs that make the person in the position successful. This isn't a job description but very close to it with much more detail. You need to know exactly what an incumbent in the position needs to have and do to succeed. To develop this profile, you will want to involve both the incumbent and the supervisor to be sure it is specific and accurate.
Component 2: Identification of successors
Now that you have a detailed description of the position, you are ready to begin identifying the potential successors for each position. It is important to remember a successor doesn't have to be in the same department. So, don't miss quality candidates just because they aren't right under your nose. Also, you may find the best successor could even be outside the organization with a competitor, customer, or vendor. As with the first component, be sure to involve both the incumbent and the supervisor to develop a list of successors. And, yes, you will probably want to identify more than one individual to ensure you are all in agreement on the successor and have a backup.
Component 3: Plan to prepare the successors
Next, you are ready to begin preparing the potential successors. To do this, a detailed plan will need developed to help ensure the successor is ready when or if the time comes for them to step into the position. Your plans need to be very specific on what education, experience, or skills the person needs to have before they will be ready; plus, when and how you are going to ensure they get it. This may require them to take on special projects outside their current job to ensure the experience is gained. In addition, you may want to develop a mentor program to help ensure the candidate has someone to help them along the way.
For internal successors, you will have to decide if you will tell them or not. Nine times out of ten you are probably better to tell them than not. It would be a shame to do all this work and have them leave the organization because they didn't know what was being planned for them. At the same time, if you tell them, have a plan for what you will do with them until or if the time never comes so you don't lose them.
Now, if the potential successor is an outsider, there are still things you can do. Talk to the person - either to build a relationship and credibility with them or to actually tell them your thoughts. If they aren't interested at all, it's better to know now than when the crisis happens. If they seem at all interested, start building the relationship and talking to them about any skills and experiences they could be developing.
In all these cases both internal and external, you need to be sure you make it very clear that this is developmental and future focused and by no means a promise or employment contract. But, continue to maintain communications and relationships with the individual so they don't either leave your organization or become prejudiced against it because they feel that they are ready but the opening isn't there.
Component 4: Identification of other HR implications
Last, you need to determine any other human resources implications that each succession plan may have on your business. Think about how the plans may impact other staffing needs (i.e. domino affect of moving one person), group training requirements, temporary support during a special project assignment, the need for special project assignments, or bonus/compensation increases to accommodate an individual learning new skills but not getting promoted yet.
Keep in mind, these four components don't make your succession plan. They must go hand in hand with policies, procedures, and tools that support your business needs and culture. You can learn a lot from what others are doing or not doing with succession planning but remember what you need in your organization should be customized to meet your organizational needs. The most important key is to have a plan that will minimize the impact on the operations of your business so you can succeed tomorrow!
Can Your Business Succeed Tomorrow - To learn more about this author, visit Robin Throckmorton's Website.
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With the events of 9/11 and even some unexpected tragedies locally, I have been surprised by how many companies are not prepared to handle the loss of a key player in their organization to a tragedy or just a sudden job change. Whether we are human resources professionals or business owners, we know what positions are critical to the organization and know we need to have a contingency plan or succession plan in place to minimize the impact of a loss.
However, statistics show that less than 15% of businesses actually do have a plan. But why? Some of the most common answers I get to this question are: it takes too much time to create a succession plan for all our critical positions; the plan changes too often with our business needs; or how likely is it to really happen anyway? But, depending on the position, the impact of a loss with no plan in place can have many affects up to and including closure of the business; loss of productivity for six months or more; turnover of other key employees; or loss of customers. If you do the cost benefit analysis, you'll probably find yourself creating a succession plan for every employee in the organization.
For now, let's stick to the critical key positions and later you can add the other positions as well. (Remember, every position in your organization affects the business or you wouldn't need the position at all). So, how do you identify what positions are the most critical to business operations? This is a job for human resources AND top management, which are probably the first positions you will have on your list as critical. Together HR and management need to evaluate all the positions to determine which positions are likely to:
-impact daily operations of the business
-have the most visibility to the customer
-be key to meeting business objectives / goals
-be very difficult to replace in this marketplace
Once you have your positions identified, you are ready to begin developing the plan. There are four basic components that I recommend your plan include:
1. Profile of the position(s)
2. Identification of successors
3. Plan to prepare the successors
4. Identification of other HR implications
Component 1: Profile of the position(s)
You will need to develop a detailed profile for each of the identified positions which should include key responsibilities, education, skills, experience, and any other needs that make the person in the position successful. This isn't a job description but very close to it with much more detail. You need to know exactly what an incumbent in the position needs to have and do to succeed. To develop this profile, you will want to involve both the incumbent and the supervisor to be sure it is specific and accurate.
Component 2: Identification of successors
Now that you have a detailed description of the position, you are ready to begin identifying the potential successors for each position. It is important to remember a successor doesn't have to be in the same department. So, don't miss quality candidates just because they aren't right under your nose. Also, you may find the best successor could even be outside the organization with a competitor, customer, or vendor. As with the first component, be sure to involve both the incumbent and the supervisor to develop a list of successors. And, yes, you will probably want to identify more than one individual to ensure you are all in agreement on the successor and have a backup.
Component 3: Plan to prepare the successors
Next, you are ready to begin preparing the potential successors. To do this, a detailed plan will need developed to help ensure the successor is ready when or if the time comes for them to step into the position. Your plans need to be very specific on what education, experience, or skills the person needs to have before they will be ready; plus, when and how you are going to ensure they get it. This may require them to take on special projects outside their current job to ensure the experience is gained. In addition, you may want to develop a mentor program to help ensure the candidate has someone to help them along the way.
For internal successors, you will have to decide if you will tell them or not. Nine times out of ten you are probably better to tell them than not. It would be a shame to do all this work and have them leave the organization because they didn't know what was being planned for them. At the same time, if you tell them, have a plan for what you will do with them until or if the time never comes so you don't lose them.
Now, if the potential successor is an outsider, there are still things you can do. Talk to the person - either to build a relationship and credibility with them or to actually tell them your thoughts. If they aren't interested at all, it's better to know now than when the crisis happens. If they seem at all interested, start building the relationship and talking to them about any skills and experiences they could be developing.
In all these cases both internal and external, you need to be sure you make it very clear that this is developmental and future focused and by no means a promise or employment contract. But, continue to maintain communications and relationships with the individual so they don't either leave your organization or become prejudiced against it because they feel that they are ready but the opening isn't there.
Component 4: Identification of other HR implications
Last, you need to determine any other human resources implications that each succession plan may have on your business. Think about how the plans may impact other staffing needs (i.e. domino affect of moving one person), group training requirements, temporary support during a special project assignment, the need for special project assignments, or bonus/compensation increases to accommodate an individual learning new skills but not getting promoted yet.
Keep in mind, these four components don't make your succession plan. They must go hand in hand with policies, procedures, and tools that support your business needs and culture. You can learn a lot from what others are doing or not doing with succession planning but remember what you need in your organization should be customized to meet your organizational needs. The most important key is to have a plan that will minimize the impact on the operations of your business so you can succeed tomorrow!
Can Your Business Succeed Tomorrow - To learn more about this author, visit Robin Throckmorton's Website.
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David BarrDavid Barr is the President of Venture Opportunities, Inc. David has been a professional business broker/intermediary since 1980 focusing on General Business Brokerage and Mergers and Acquisitions representing client transaction value from $400,000 to $20,000,000. Mr. Barr has handled the sale of over four hundred and fifty companies. David earned a university degree from the State University of New York majoring in economics and business. David holds the Mergers and Acquisition Master Intermediary and the Certified Business Intermediary designations from the International Business Brokers Association. He is also a Senior Business Analyst and a Texas licensed Real Estate Agent. For more information about David and Venture Opportunities, visit www.bizdealmaker.com. - Visit David Barr's Website |
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Cheryl MatthynssensCheryl is a life skills coach, licensed Chemical Dependency Counselor and a 20 year entrepreneur. Cheryl's dedication to achieving a life of balance led to her expanding her teaching from the simple managing of life's daily challenges to adding financial well being as well. A direct marketer with DrinkACT, she is gaining ground in the online community with her concepts of making sure business owners, entreprenuers and employees have well rounded life styles. She opened up a small affiliate site - The Balance Guide- to help others find resources for mental and emotional well being. Visit Cheryl's blog to see more of the diversity beyond business she has began offering online at www.thebalanceguide.blogspot.com - Visit Cheryl Matthynssens's Website |
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