The Need For Effective Succession Planning And The Steps Organizations Can Take To Achieve Them

Source: SHRM

Succession planning is the process of identifying and developing potential leaders who can step into critical roles within a company or organization. This is important because it ensures that the company has a pool of qualified individuals ready to take on leadership positions should the need arise.

A survey by SHRM (Society for Human Resource Management) amongst HR professionals pointed out that a whopping 21% do not have a formal succession plan. Even amongst CEOs, where turnover is rising, only 54% of boards are grooming a specific successor, and 39% have no viable internal candidate.

All these points towards an urgent need for succession planning across the board.

Having worked with leading enterprises across Asia-Pacific, such as Air Asia, Inspiro, Aditya Birla, Max Life Insurance, ThaiRe Life Insurance and so on, with regards to succession planning, here are the steps that we would recommend:

• Identify Critical Roles
  

  The first step in succession planning is identifying critical organizational positions.  While the average time to fill an open position is 42 days, according to SHRM, some jobs take longer to fill, affect operations adversely, and thus should be prioritized.

  To identify key positions, consider the following factors:

  • Strategic importance: For example, a leadership position in a key business unit or functional area may be more critical than a lower-level role with limited impact.
  • Complexity: For example, a senior role in a rapidly changing industry or market may require an individual with a high level of adaptability and expertise.
  • Potential for growth: Choose positions that may provide individuals with the chance to learn new skills, take on additional responsibilities, or advance their careers.

  Once these roles have been identified, they should be prioritized based on the potential impact on the organization, with the most critical roles receiving the highest score.

• Assess Current Talent and Create a Talent Pool

  The second step in succession planning is to assess the current talent within the organization.

  This involves evaluating the skills, experience, and potential of each employee to determine who has the ability and potential to take on leadership roles in the future.

  There are several ways to assess the current talent within an organization. One of the common ways of doing it is via a 9-box grid.

  What is a 9-box grid?

  The 9-box grid is an individual assessment tool that evaluates an employee’s current and potential level of contribution to the organization.

  The 9-box grid is most used in succession planning as a method of evaluating an organization’s current talent and identifying potential leaders.

   

  	Does Not Meet Expectations	Meets Expectations	Exceeds Expectations
  High Potential	Seasoned professional capable of expanded role but may need coaching and mentoring.	Good performer. Give stretch assignments to help prepare for next level.	Superstar employee. Big picture thinker; problem solver; self-motivated.
  Medium Potential	Can perform well with coaching. Need to be given stretch goals.	May need coaching in several areas, including people management.	Star performer. Focus should be on helping improve strategic thinking.
  Low Potential	Bad hires/Misfit.	Effective performer, but may have reached career potential; Coaching can be given	Effective performer. Can be encouraged to develop communications and delegation skills.

   

  Apart from the 9-box grid, skill assessments can take other forms such as surveys, one-on-one interviews, or quizzes. The methods used depends on the size of the organization.

  In conducting the assessment, it is important to involve multiple stakeholders, such as managers, supervisors, and HR professionals. The results of the assessment should be used to create a talent pipeline of employees who have the potential to take on leadership roles in the future.

  It might also be helpful to look at the skills of freelancers and consultants who currently partner with the organization or at former employees who might be interested in returning.

• Create Development Plans

  Developing a customized development plan for everyone in the talent pool is an essential step in the succession planning process.

  This plan should be tailored to the individual’s needs, goals, and areas for improvement, and should include specific actions and activities that will help them gain the skills and experience necessary for a leadership role.

  Some potential elements of a development plan may include:

  Training opportunities: These could include workshops, seminars, and other learning experiences that are relevant to the individual’s role and career goals.

  Mentoring: Pairing the individual with an experienced leader who can provide guidance, support, and feedback can be an effective way to help them develop the skills and expertise they need for a leadership role.

  Stretch assignments and projects: Providing the individual with challenging, high-visibility projects can help them gain the experience and exposure they need to succeed in a leadership role.

  Networking opportunities: Connecting the individual with other leaders within the organization or industry can help them build valuable relationships and gain insights and advice that can support their growth.

• Evaluate Your Succession Plan’s Effectiveness

  Regularly evaluating the progress of individuals in the talent pool is a crucial step in the succession planning process. This evaluation can help you determine whether individuals are on track to meet their development goals and can identify any areas where additional support or resources may be needed.

  When conducting an evaluation, consider the following factors:

  1. Are individuals making progress towards their development goals? This can be assessed through evaluations of their performance, feedback from mentors or supervisors, and other metrics.
  2. Check if there have been any changes in the organization or the individual’s circumstances that may impact their development.
  3. Are the development plans still relevant and effective? As time passes and the organization and individuals evolve, it may be necessary to adjust the development plans to ensure that they remain relevant and effective.

  By regularly evaluating the progress of individuals in the talent pool, you can identify any potential issues or challenges and take action to address them. This can help ensure that individuals are prepared and capable of taking on leadership roles when the time comes.

• Metrics to Track

  HR leaders can use several metrics to measure the effectiveness of a succession planning process with a relevant tool. These metrics can help you understand whether the process is meeting its goals and can identify areas for improvement.

  Some potential metrics to consider include:

  • Time to fill: This metric measures the time it takes to fill a leadership position once it becomes available. A shorter time to fill can indicate that the succession planning process is effective at identifying and developing qualified individuals who are ready to take on the role.
  • Success rate: This metric measures the percentage of individuals who have been promoted or successfully transitioned into a leadership role through the succession planning process. A high success rate can indicate you are on the right track.
  • Retention rate: This metric measures the percentage of individuals who remain with the organization after being promoted or transitioning into a leadership role. A high retention rate can indicate that individuals are satisfied with their new roles and are committed to the organization.
  • Development plan completion rate: This metric measures the percentage of individuals in the talent pool who complete their development plan. A high completion rate can indicate that individuals are engaged in the succession planning process and are taking the necessary steps to prepare for leadership roles.

  By tracking these metrics, you can gain valuable insights into the effectiveness of your succession planning process and identify areas for improvement.

Blunders to Avoid

To ensure that your succession planning process is effective, it is important to avoid common mistakes that can undermine its success. These include:

• Not involving key stakeholders: Succession planning should not be a top-down process but should involve input and participation from key stakeholders throughout the organization.
• Not regularly updating the plan: Succession planning is an ongoing process, and the plan should be regularly reviewed and updated to reflect changes in the organization and the capabilities of the individuals involved.
• Not providing adequate support and resources: Failing to provide adequate resources can hinder the development of individuals in the talent pool and undermine the success of the succession planning process.
• Not considering external candidates: While it is important to develop internal talent, it is also important to consider external candidates who may have the skills and experience necessary for leadership roles. Failing to consider these candidates can limit the pool of potential leaders and limit the organization’s ability to find the best person for the role.

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