White Paper: 5 new succession planning rules
The answer is yes! Perhaps even more so than the past, providing companies are prepared to challenge outdated ideas.
Download our eBook which describes the key steps to creating and updating your succession plan in 2017.
Succession planning used to be relatively straightforward. Traditionally, large companies would use a structured approach to identify potential internal replacements to be prepared for the day when a senior manager would retire, hopefully ensuring a smooth succession and the least possible disruption to business as usual.
Fast forward to today and the process has become far more complicated for a plethora of reasons. The retirement of the baby boomers is widely acknowledged to be one of the biggest challenges facing workplaces in our lifetime, given the potential loss of organisational knowledge, especially for companies that do not manage the process well. Companies are experiencing higher staff turnover, reduced employee loyalty and critical skills shortages, underlined by a significant change of mind-set by younger employees about the concept of work. The 2016 Deloitte Millennial Survey found that
66 per cent of this cohort, roughly defined as people who reached adulthood in the early 21st century, expects to change jobs in the next five years.
The advent of the gig economy means talented millennials really do have a reason to be smug. Those with sought-after skills can channel their abilities into working smarter, not harder, taking on freelance or short-term contracts for a number of clients, maximising work-life balance as well as profit.
So, where does this leave companies hoping to attract and retain future leaders?
What is needed now, is for corporate decision-makers and facilitators, including chief executives, senior managers, line managers and HR personnel, to reconsider the ways they tackle the problem in order to develop a holistic, integrated strategy that takes into account the specific strengths and challenges facing their business.
61% of UK small and medium-sized enterprises admit to having no clear plan in place to ensure their business does not suffer when a key employee leaves.
It sounds complicated, but it does not have to be. Nor does it have to mean a raft of extra work for already over-stretched HR teams. Our eBook covers five steps to help you develop a succession plan fit for the next generation of workers. Download our full eBook here for examples on how you can implement the following steps in your business.
1. How to develop a strategy
|Succession strategies are by nature aligned with key areas of medium to long-term business planning, such as recruitment, in-house training and development, mentoring, increasing engagement and performance review. The analytics and databases already used by your HR team to support these tasks can also be utilised to identify and develop potential leaders. It just requires adding an extra dimension to existing processes.|
2. How to communicate your strategy
|Traditional succession planning methods fail because they are usually hierarchical and narrow, focussing on executives and heads of department. While it would not be economical or realistic to develop an individual succession plan for every staff member, particularly in a large company, it makes sense to consider having an action plan for the departure of staff who may not be senior management, but who nevertheless play a crucial role.|
3. How to identify/develop future leaders
|At a time when workplace rules are being rewritten, ensuring everyone from senior directors to new recruits is aware of succession strategies is essential. Employees in their twenties and thirties may be more likely to switch jobs than their parents or grandparents, but they are more likely to stick around for longer if they are kept in the loop about opportunities for promotion and advancement, including the opportunity to diversify their skills, and made to feel included in the wider picture of organisational success.|
15% of SMEs believe the biggest threat to their business is 15%the departure of a senior executive
4. Which staff to have plans in place for
|Succession planning should be aligned with overall principles of fairness and diversity. Indeed, it makes sound business sense. In an environment of critical skills shortages and anxiety about future leadership, it is rational to explore all avenues to identify potential talent both internally and externally. For example, one large cohort of under-used talent is mid to senior level professional women who have been out of the workforce for several years due to family commitments.|
5. How to think outside the box when it comes to succession planning
|The gig economy, a market in which employees work short-term contracts or are paid by the task rather than by the hour, has inevitably created huge challenges for conventional organisations. It may have been an unsurprising outcome of global economic turmoil and a work culture where old-fashioned loyalty between companies and employees has broken down, but it has left business management and HR directors alike with the gigantic quandary of how to lure potential leaders who could easily make more money working fewer hours for themselves.|
In conclusion, developing an operational succession plan in today’s shifting corporate culture is going to have to take into account a raft of factors that would not have been considered ten years ago. That said, most companies already have the kernel of a succession plan in the recruitment, retention and talent management programs and processes already in place.
Click here to download our full eBook for more information on each of the steps above.