Succession planning is an important process for any company.
To do it effectively, it’s important to develop and eventually implement a succession planning system for what happens when an employee leaves. It’s important because it ensures the business will continue to grow and maintain its success when there is a departure.
This article will explore what succession planning is, why it’s crucial, and what strategies are best for implementing it in your organization.
Let’s get started.
What is Succession Planning?
The succession planning definition, according to Cambridge Dictionary, is:
“the process of finding suitable people and preparing them to replace important executives in an organization when these executives leave or retire”
Essentially, succession planning is what happens when you prepare for the future of your business by putting a plan to choose new employees and bring them up to speed after being hired. This ensures the business will continue to grow, even with changes in staff.
Succession planning is most commonly used for top positions in a company, like CEO, president, and director of the board (if your company has one). Insight Global, for example, has a branch specifically focused on executive search. But succession planning is useful for any position within a company, especially a position that has been manned by an employee for a lengthy period of time. It’s also good to have because you will often promote employees from within, and you need a plan to replace that employee, as well.
It can be hard to identify what it is your company needs when thinking about succession planning because there are many factors involved. But this process is important. Let’s talk about why that is.
Why is Succession Planning Important?
In today’s world, businesses are constantly evolving. Succession planning is what happens when you make sure your business operations will continue to grow and maintain their success even if someone leaves. It ensures that the organization’s growth doesn’t stop but rather continues with minimal disruption.
Succession plans not only allow companies to be prepared for future departures, but it’s also good for employee retention, because current team members will see there are opportunities for career development within the company.
The right succession strategy provides clear guidelines about how key positions should be filled, what qualifications are needed for those positions, and what training employees will need to be promoted into more senior roles.
These are all things that can help employees feel motivated and inspired about what they do every day, which will ultimately result in positive outcomes for the company.
9 Succession Planning Strategy Tips
A succession planning program allows your business to move forward after key employees leave or get promoted to other positions. There are different procedures that you can use to ensure a smooth transition for your company, as well as what will need to happen in order for the next generation of leaders within your business to be able to take over without any hiccups or issues occurring.
We’ve laid out nine steps involved in successful succession planning.
1. Understand Your Company’s Needs
The very first step is to understand what your company needs.
Do you need someone with strong communication skills or someone who has good technical abilities when it comes to using certain software programs? List out all the qualities you are looking for in a new employee. These things can include:
- Necessary experience
- Leadership abilities (this is typically the most important when it comes to promoting)
- Connections within an industry
- Communication skills
- Plan for the position or company’s direction
Another thing you can do to find out the company’s needs for the position is as ask who’s leaving the position what skills/qualities you should look for in a candidate when searching for their replacement.
Finally, what is your time period? You may only have short notice that the employee is leaving, but you also may have months to put a plan in place.
It’s important you know what your company needs for the position before going through the process of finding a new employee.
2. Identify Succession Candidates (Internal and External)
After you’ve identified what your company needs are, the next step is to create a list of potential candidates who could assume the position based on what you’ve learned about your company’s demands.
This list should be made up of employees who are ready to take on new responsibilities and have the right skill sets to accomplish the needs you listed out before. It’s important to get an idea of which people are interested in moving up within the organization, what their strengths are, and what they’ve done so far that makes them a top contender for the next role.
You also need to look at what someone’s career path has been and if the position you’re trying to fill falls along their professional and personal development path. Do this by asking candidates directly. (More on this in a moment.)
You can’t prevent yourself from promoting a good employee because they’re doing a good job in their current role. Keep all of your options open.
This is all to say that there is more than just looking at someone’s hard and soft skills.
However, sometimes the best person to accomplish your succession plan is someone external to the organization. Just as employees within the organization can have the necessary skills and qualifications, you may find external candidates who check all the right boxes. While external candidates may cost more in the end to bring in the fold, they also may have fresh ideas and direction your company is looking for.
Typically external candidates for succession plans are found through connections within an industry or through a search firm.
Overall, it’s vital you understand both a candidate’s skill set and the qualities that don’t show up on paper.
3. Reach Out to Employees Who Are Good Options
Once you have a list of candidates, it’s time to reach out to them.
If those candidates express they are interested in filling the open position, make sure they’re clear on what the process entails. These process details include:
- How many steps/interviews the process has
- The timeline for when they’d succeed the current employee
- What is expected of the employee between the time they’re selected and ultimately start the job
- Explaining what the role’s responsibilities are
Keep in mind that not everyone will be ready for what the next role demands. They may express that to you before you start fully vetting the candidates, but that’s okay. It’s important to have your succession candidates be involved in discussion once they’re deemed a potential fit. All the candidates need to feel comfortable letting you know how they feel throughout the whole process.
4. Collaborate with Your Team to Evaluate Candidates
It’s difficult for one hiring manager or interviewer to gain the complete picture of what potential successors are capable of or what they can bring to your organization. To help curb this stress and make the process better as a whole, involve multiple people from your company in the evaluation procedures.
This is where it’s helpful having the person whom is being succeeded involved in the process. They can help evaluate candidates, as can other employees who’ve worked with the role on a day-to-day basis. This includes employees who report to the role as well as people who have the role report to them. This way everyone’s input will be considered and a consensus will be reached as to who the best candidates are.
5. Decide On A Candidate and Inform All Involved
Now you need to pick the candidate.
After all the evaluating and consulting, choose the person who will succeed the employee leaving and inform them of your decision. If they accept and agree to everything negotiated beyond day-to-day responsibilities, great! It’s time to enact a transition plan (which we’ll talk about in a moment).
If your initial candidate declines, huddle back with the decision makers and pick the next candidate and follow the same steps of the transition plan.
Lastly, once the candidate is locked down and both sides are in agreement, inform all those who didn’t get the position of your decision. If they have questions about why they didn’t get the job, be as transparent as you can about why. They may have lacked certain skills or qualifications, and this will give them the opportunity to work on those for the next time a job is open.
6. Create/Implement a Transition Plan
Next, create a transition plan for what the next steps are for a candidate after they’re selected. This plan will define what the new candidate will do between being selected and starting the new role. It also defines what the person leaving should do to help this process along.
Include these details in your transition plan:
- The timeline for the full transition
- Priorities for what needs to be accomplished
- What the person leaving needs to wrap up and transition responsibility over to the successor
- What the successor needs to wrap up in their old role and transition to the person succeeding them
- Any mentorship the predecessor needs to give to the successor
- What trainings the successor needs before starting a new role
- Whatever information the successor needs to accomplish their new responsibilities
You can also give the successor a trial run of their new role and responsibilities while the predecessor is still there. This includes tasks like leading meetings, reporting to new bosses, and participating in higher-level strategy summits. This will be helpful so the successor can get feedback on how some things in the role are done while the person who knows how to do the role is still there.
7. Evaluate Results and Test Any New Procedures
Once the successor has started their new role, you should evaluate your plan that put the person in the role in the first place. Ask yourself questions like:
- Were they given too many tasks too fast?
- Do you need to extend the transition period?
- How are they handling their new responsibilities?
- Are they achieving similar (or better or worse) results than their predecessor?
Ask the successor to provide feedback on how the succession plan was implemented on their end, too. Encourage transparency, because your evaluation will inform how you enact future plan.
If you find any holes in your succession planning strategy, you can update your plan with new procedures. Test these procedures out, too, before fully involving them in your plan. For example, maybe your next transition period is three months instead of two months. Did that extra time provide the successor greater comfort and ability to do their new role?
8. Acknowledge Your Succession Plan in Future Hiring Decisions
Hire for what you need now, but don’t forget about succession planning when it comes to future hiring decisions.
Take what you’ve learned from this process into consideration when it comes to what skillsets and talents are needed for your organization to continue to grow.
It’s always great to plan for internal talent to assume key roles, but new employees can also be a part of your replacement planning process if they bring valuable experience to the table and their career goals align with upper management opportunities that may become open down the line.
The goal is to create a win-win situation for both the candidate and what the company needs in the succession planning process.
9. Have A Plan to Backfill a Role If Needed
If you hired from within, that now leaves another role that needs a succession plan.
Again, this shouldn’t persuade you to only hire external candidates. It may be more likely that internal candidates are the best for promotions. But also recognize that as you implement a succession strategy in one role, it may create a need for a succession plan in another. That’s okay, though, because you have all the aforementioned steps to help you implement one!
Succession planning and succession management are important parts of growing and maintaining a successful company.
You need strategies in place that will help you fill key positions quickly and efficiently so your business can continue running as smoothly as possible without missing any opportunities or wasting time during the hiring process.
Succession planning is an effective way of expanding what your business is capable of doing and making sure that you’re prepared for growth opportunities. There should always be room in any organization for someone to move up, even if they may not have had experience at this level before.
The succession planning process isn’t something that develops overnight. If there’s a well-defined plan in place, though, it helps individuals and the company accomplish goals with greater ease.
Now that you know what to do when a key employee leaves, it’s time to ensure you hire employees who can fill critical roles in the future. Head over to the Insight Global hiring page and we’ll help you add top talent right away.