Succession planning is a process many companies use. It involves identifying and developing key employees who can then go on to take on a key position in the organization in the future. The process involves evaluation as well as training. It is often compared to replacement planning. This is another process used whereby an individual is assessed solely based on his or hers past performances. This post will explain why succession planning is important, as well as revealing what the process entails. So, keep on reading to find out more…
Why is succession planning important?
- You will be better prepared for any future catastrophes – Unfortunately, no one can plan for an unforeseen disaster. However, you can make sure you are better prepared. Succession planning gives you a better chance of overcoming any issue, as you will have members of staff who are trained and ready to take on important roles during this period.
- Ability to see the big picture – Succession planning presents you with the opportunity to see your company from a bigger and more realistic perspective. Typically, when business owners consider replacing employees they only think about the high-level positions. However, it is the individuals who do the day-to-do work that actually keeps your company going. Thus, by having a succession plan in place you consider each position. Failure to do this can result in serious consequences for the productivity and effective running of your business.
- Support expenses and sustain income – There is no denying that financial management is an essential part of any business. Succession planning can aid the monetary side of your company. How? Well, it provides answers regarding what you and your employees may need for future income. You will also be able to determine the expenses that will occur once your employee steps into the role in question. This all allows for better financial planning.
What does the process of succession planning include?
1) Determine critical positions at your company – As mentioned, this does not only relate to high-end executives but those that are essential to the day-to-day running of your business.
2) Identify the skills required for each position – Assess what skills and capabilities are required for each of the critical positions you have just outlined.
3) Locate and evaluate potential successors – Thirdly, you have to identify potential candidates. Many companies will already have a formal competency model in place.
4) Involve managers and leaders – This is the best way to ensure you come to the right decisions regarding selecting the right successors and also determining the best ways to train them.
5) Commit to developing your internal talent – Last but not least, you need to continually monitor progress and commit to developing talent. When drawing up training plans and alike, such as an online MBA program and similar high-level training solutions, this gives you the opportunity to improve the wealth management of your company, as you will be able to foresee expenses that will be required for fulfilling particular roles at your company.
Hopefully, you now have a better understanding of succession planning – why it is important and how to go about it!