Succession Planning - Your Operational Necessity
Succession Planning - Your Operational Necessity
A sudden resignation
A traumatic or terminal illness of a key employee, or
A catastrophic event impacting many key employees…
Do you still think your organization is untouchable? Too small to matter? To big to be impacted? Shall we fill this article with stories to tell you otherwise? Bottomline is that every organization MUST take succession planning seriously to avoid a tremendous disruption in internal processes and impact on customers if any circumstances like those listed above would happen to occur to a key person in your organization.
According to JJ Keller & Associates, by the year 2010 the 35-44 year olds, those normally expected to move into the senior management ranks, will decline by 10%. As this age group shrinks the older group of workers will grow and prepare for retirement or a form of semi-retirement but definitely not management. This presents us with a huge potential for loss of knowledge or also termed as "brain drain." It's imperative for us to take action now to capitalize on transferring this intellectual capital from the older workers through a formal succession planning program including a form of mentoring to avoid this "brain drain."
With 50% of organizations with a plan in place (SHRM's 2006 Succession Planning Report) it is comforting to know that we are implementing these plans and using them to prepare for the future. In case you need help getting started on your plan, below are some steps to get you started or review against what you may have in place:
1) Strategic Direction.
Review your organization's strategic plan with special attention to the position needs of the future. Keep in mind that the organization (most likely) will have positions that vary slightly from what they look like today and consider then when creating your succession plan.
2) Conduct a Workforce Assessment.
How well do you really know and understand your existing workforce? Do you have an idea of how many of your employees are eligible for retirement in the next 1 - 2 years? 5 years? How many of them are managers or in key positions? Are there any individuals in the organizations that might be ready to fill those roles at that time? If not, what do you have to do to get them ready?
3) Identify Key Positions.
What are the key positions in the organization that need a formal succession plan? Remember to look beyond your senior management team and look deep. Is there a specific role for example, in the IT department that the organization would have difficulty "doing without"? Create a succession plan not only for senior management roles but also those "high risk" positions.
4) Evaluate The Roles
Properly evaluate the role by identifying skills and competencies necessary for success in the role. Don't forget that this role may look different in the future so take special attention to the future skills needed.
5) Review your workforce.
Identify those high potential employees who may be able to step into the identified positions with training and development. A few things to remember here:
a. This is impossible to do without a good assessment of your employees. A good performance management process should assist with this assessment but the information must be gathered and maintained.
b. Remember to think cross-functionally and work as a senior management team when identifying these HPEs. Just because an employee is a fabulous customer service manager doesn't mean they aren't interested and highly qualified for the CFO role.
6) Elicit Input from the Successor
Ask the employees what they want for themselves in their career path. You don't want to spend time and money developing employees who have no interest in moving up the ladder or who have other plans for their careers.
7) Identify The Gaps
What are the necessary skills and competencies of the identified employees? Create a development plan to fill those gaps. The plan should be specific to include what will be done and by when so the plan doesn't collect dust on a shelf and never get accomplished Identify the training and development needed to prepare the individuals for these potential roles. Development may include special assignments, training in-house, taking outside courses, or working in another department to learn its functions.
8) Exit Strategies
At the executive level, a succession plan should include an exit strategy for current executives, and contingency plans for emergency replacement in the event of unforeseen extended unavailability.
9) Review your plan on a regular basis.
Again, change is constant and this document must be reviewed on a regular basis as the organization has turnover and the organization's strategic plan changes.
When you are creating your succession plan, there are a few things that you will want to keep in mind to ensure your plan is a success:
Think strategically.
Change is the only thing that can be guaranteed and that is especially true when you prepare a succession plan. As strategic partners, we implement succession plans as a way to try and prepare for the future and the inevitable change not only with the opening of a position but change in the position itself. The organization is not (hopefully) going to be stagnant and changes to the position are most likely to occur as the organization grows and changes. When you identify potential successors, think about what skills the changing position will require for success.
Look at the position, not the person.
Absolutely look at the position and not the person when you are evaluating which position(s) should be identified as needed a succession plan. Otherwise, you'll get hung up trying to replicate the traits of the individual that the skills needed for the position.
Keep an open mind.
The top 10% performers are not necessarily the only ones who are potential successors. Look deep…we all have hidden talents that may be useful to the organization. Also, be sure you are not ignoring good employees because of biases (discrimination) for being too old, too young, or even just "different than you."
Training and development is essential.
A nicely written succession plan doesn't do anything for the organization if you don't invest in the training and development of potential successors. If money is limited, don't let that deter you. The CFO can mentor the identified individual(s) with special projects, delegation of some duties, etc.
Get manager buy in for the plan.
Many managers tend to shy away from succession plan development due to their own insecurities and fears. Managers must be accountable for the identification and development of potential successors and human resources should assist in calming the fears and explaining the process
Keeping the plan a secret.
How many promising employees do you think you've lost to competitors because they had no idea you had a plan for them? The more you can involve the entire organization in your efforts, the more successful you will be. If the employee becomes "ready" before the successor moves on, you may be able to utilize their skill in another area. If not, you may be able to place them with a vendor or a customer rather than lose them to the competition.
Only considering promotions.
Lateral succession may be a needed in your organization, especially if you operate very thin and flat. Don't let that hinder an employee's opportunity to grow and develop-or your organization's ability to attract and retain employees with growth opportunities.
As we struggle with low unemployment, changing workforce demographics, reduced budgets, an increased focus on emergency preparedness, and business continuity planning, we are required to "plan for the emergency". Our "human" resources are become more and more critical to the success of our organizations. And, key positions including both leaders and hard to fill specialized skills are even more crucial to the operations of the company. To ensure any staffing changes occur smoothly, with minimal disruption to internal processes and appear seamless to our customers, we must have a plan in place. If you haven't developed your plan, hopefully this article has enticed you to develop a plan and provided you with the tools to get started.
Succession Planning Your Operational Necessity - To learn more about this author, visit Robin Throckmorton's Website.
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What will drive your organization to finally take succession planning serious? Will it be:
A sudden resignation
A traumatic or terminal illness of a key employee, or
A catastrophic event impacting many key employees…
Do you still think your organization is untouchable? Too small to matter? To big to be impacted? Shall we fill this article with stories to tell you otherwise? Bottomline is that every organization MUST take succession planning seriously to avoid a tremendous disruption in internal processes and impact on customers if any circumstances like those listed above would happen to occur to a key person in your organization.
According to JJ Keller & Associates, by the year 2010 the 35-44 year olds, those normally expected to move into the senior management ranks, will decline by 10%. As this age group shrinks the older group of workers will grow and prepare for retirement or a form of semi-retirement but definitely not management. This presents us with a huge potential for loss of knowledge or also termed as "brain drain." It's imperative for us to take action now to capitalize on transferring this intellectual capital from the older workers through a formal succession planning program including a form of mentoring to avoid this "brain drain."
With 50% of organizations with a plan in place (SHRM's 2006 Succession Planning Report) it is comforting to know that we are implementing these plans and using them to prepare for the future. In case you need help getting started on your plan, below are some steps to get you started or review against what you may have in place:
1) Strategic Direction.
Review your organization's strategic plan with special attention to the position needs of the future. Keep in mind that the organization (most likely) will have positions that vary slightly from what they look like today and consider then when creating your succession plan.
2) Conduct a Workforce Assessment.
How well do you really know and understand your existing workforce? Do you have an idea of how many of your employees are eligible for retirement in the next 1 - 2 years? 5 years? How many of them are managers or in key positions? Are there any individuals in the organizations that might be ready to fill those roles at that time? If not, what do you have to do to get them ready?
3) Identify Key Positions.
What are the key positions in the organization that need a formal succession plan? Remember to look beyond your senior management team and look deep. Is there a specific role for example, in the IT department that the organization would have difficulty "doing without"? Create a succession plan not only for senior management roles but also those "high risk" positions.
4) Evaluate The Roles
Properly evaluate the role by identifying skills and competencies necessary for success in the role. Don't forget that this role may look different in the future so take special attention to the future skills needed.
5) Review your workforce.
Identify those high potential employees who may be able to step into the identified positions with training and development. A few things to remember here:
a. This is impossible to do without a good assessment of your employees. A good performance management process should assist with this assessment but the information must be gathered and maintained.
b. Remember to think cross-functionally and work as a senior management team when identifying these HPEs. Just because an employee is a fabulous customer service manager doesn't mean they aren't interested and highly qualified for the CFO role.
6) Elicit Input from the Successor
Ask the employees what they want for themselves in their career path. You don't want to spend time and money developing employees who have no interest in moving up the ladder or who have other plans for their careers.
7) Identify The Gaps
What are the necessary skills and competencies of the identified employees? Create a development plan to fill those gaps. The plan should be specific to include what will be done and by when so the plan doesn't collect dust on a shelf and never get accomplished Identify the training and development needed to prepare the individuals for these potential roles. Development may include special assignments, training in-house, taking outside courses, or working in another department to learn its functions.
8) Exit Strategies
At the executive level, a succession plan should include an exit strategy for current executives, and contingency plans for emergency replacement in the event of unforeseen extended unavailability.
9) Review your plan on a regular basis.
Again, change is constant and this document must be reviewed on a regular basis as the organization has turnover and the organization's strategic plan changes.
When you are creating your succession plan, there are a few things that you will want to keep in mind to ensure your plan is a success:
Think strategically.
Change is the only thing that can be guaranteed and that is especially true when you prepare a succession plan. As strategic partners, we implement succession plans as a way to try and prepare for the future and the inevitable change not only with the opening of a position but change in the position itself. The organization is not (hopefully) going to be stagnant and changes to the position are most likely to occur as the organization grows and changes. When you identify potential successors, think about what skills the changing position will require for success.
Look at the position, not the person.
Absolutely look at the position and not the person when you are evaluating which position(s) should be identified as needed a succession plan. Otherwise, you'll get hung up trying to replicate the traits of the individual that the skills needed for the position.
Keep an open mind.
The top 10% performers are not necessarily the only ones who are potential successors. Look deep…we all have hidden talents that may be useful to the organization. Also, be sure you are not ignoring good employees because of biases (discrimination) for being too old, too young, or even just "different than you."
Training and development is essential.
A nicely written succession plan doesn't do anything for the organization if you don't invest in the training and development of potential successors. If money is limited, don't let that deter you. The CFO can mentor the identified individual(s) with special projects, delegation of some duties, etc.
Get manager buy in for the plan.
Many managers tend to shy away from succession plan development due to their own insecurities and fears. Managers must be accountable for the identification and development of potential successors and human resources should assist in calming the fears and explaining the process
Keeping the plan a secret.
How many promising employees do you think you've lost to competitors because they had no idea you had a plan for them? The more you can involve the entire organization in your efforts, the more successful you will be. If the employee becomes "ready" before the successor moves on, you may be able to utilize their skill in another area. If not, you may be able to place them with a vendor or a customer rather than lose them to the competition.
Only considering promotions.
Lateral succession may be a needed in your organization, especially if you operate very thin and flat. Don't let that hinder an employee's opportunity to grow and develop-or your organization's ability to attract and retain employees with growth opportunities.
As we struggle with low unemployment, changing workforce demographics, reduced budgets, an increased focus on emergency preparedness, and business continuity planning, we are required to "plan for the emergency". Our "human" resources are become more and more critical to the success of our organizations. And, key positions including both leaders and hard to fill specialized skills are even more crucial to the operations of the company. To ensure any staffing changes occur smoothly, with minimal disruption to internal processes and appear seamless to our customers, we must have a plan in place. If you haven't developed your plan, hopefully this article has enticed you to develop a plan and provided you with the tools to get started.
Succession Planning Your Operational Necessity - To learn more about this author, visit Robin Throckmorton's Website.
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