It’s hard to think of a more important contributor to an organization’s long-term success than the cultivation of new leaders. Developing internal talent is almost always the most effective HR strategy—you can’t necessarily rely on outside hires to fit your company’s culture, mindset, and staffing needs.
Succession planning is a business strategy companies use to pass leadership roles down to the next generation. Even when senior staff members retire, resign unexpectedly, or experience health problems, this strategy ensures businesses continue to run smoothly and without interruption. This process also serves as a way to create a pipeline of candidates for all sorts of positions, not just management roles.
Remember that succession planning is a long-term, continuous process; it isn’t a onetime fix to fill gaps in your leadership structure. The underlying idea is that succession planning must be a flexible system designed to develop talent, not merely a list or chart of top employees and where they might fit in the company’s future organizational structure. You establish a consistent source of leading talent by combining literal succession planning—e.g., replacing retiring managers—with employee development.
So, what does this look like in practice? The rest of this article will provide an overview of succession planning and concrete, actionable steps to optimize your organization’s talent-sourcing solutions.
Succession Planning 101
Developing a succession plan to prepare for leadership transitions is a critical function of the HR department. It ensures an organization has a pool of talented and capable individuals ready to step into key leadership roles when needed. Here’s a step-by-step guide for creating a comprehensive and effective leadership succession plan:
- Identifying key leadership roles: First of all, HR will need to determine which leadership positions will soon require succession planning and which roles are the most important to company operations. That way, they prioritize filling essential management openings while potentially saving resources by holding off on less vital openings.
- Assessing current leadership strengths and weaknesses: What are your leaders good at, and where are they falling short? Is your company praised for authoritative yet respectful leadership, or are you earning an unfortunate reputation for toxic management? Honestly evaluate your management team’s good and bad points, and seek to preserve and fix the latter.
- Discovering future leaders: Developing an effective leadership succession plan is exceedingly difficult if you lack competent in-house candidates. One of the most impactful decisions you can make for your company’s long-term success is to commit to identifying and nurturing your existing workforce, allowing you to groom high-potential employees from the earliest days of their careers.
- Creating a leadership development process: Once you’ve identified your organization’s next generation of leaders, develop a talent pipeline by providing training, mentoring, and development opportunities. Provide employees with workshops and programs for leadership development to help them develop the abilities needed to succeed in management positions.
Implementing the Succession Plan
Once you’ve devised a succession plan for leadership transitions, then it’s time to put it into practice:
- Communication during transitions: Don’t leave your employees in the dark. Communicate the succession plan and its importance throughout the organization, focusing on how it will impact their daily lives in the office. Ensure total transparency in the selection process, and be sure to describe how your leadership transitions account for diversity and inclusion.
- Monitoring plan effectiveness: Regularly assess the success of the succession plan by tracking the performance of individuals who have transitioned into leadership roles. Establish clear metrics and key performance indicators (KPIs) to track the progress of potential successors, and maintain thorough documentation of the succession plan, including individual development plans, progress reports, and evaluations.
- Making the necessary adjustments: If your process isn’t working, don’t be afraid to switch things up. Adjust the plan as necessary based on real-world outcomes and changing organizational needs. Collect feedback from participants, mentors, and managers to identify areas for improvement. Also, establish contingency plans for unexpected leadership vacancies or emergencies, and identify interim leaders who can step in temporarily while you prepare a long-term successor.
Proper succession planning is an indispensable part of any profitable business. It provides companies with a new generation of trend-setting leaders and top-level employees. Employees learn that the company is invested in their future and eager to assist them with career growth and advancement. New leaders take up their positions, confident they’ve learned what it takes to excel in management.
Mike Szczesny is the owner and vice president of EDCO Awards & Specialties, a dedicated supplier of employee recognition products, branded merchandise, and crystal trophies. Szczesny takes pride in EDCO’s ability to help companies go the extra mile in expressing gratitude and appreciation to its employees. He resides in Fort Lauderdale, Florida.