A large part of personal development and in building Positive Culture and Talent Management in your organisation is the delivery of a successful and robust Succession Plan. Companies tend to focus on critical positions such as Executive Board and Senior Management roles, however its a great idea to roll out across the organisation to Team Lead and Junior Managers.
Leaders who help employees grow professionally and personally have a significant positive impact on the culture of the organisation.
Culture and Succession Planning
The link between a positive culture and succession planning can be difficult to define due to intangible benefits, however there are certainly some strong evidence that delivered correctly, succession planning can have a significant positive impact on your business.
Improved Employee Engagement
Succession planning driven through the entire organisation ensures high levels of employee engagement. When employees feel that their organisation is dedicated to helping them develop their skills, they’re much more likely to be engaged at work. More so when they see opportunities for growth and career development internally.
A succession plan also helps promote job loyalty and motivation. It gives you the opportunity to connect with new and young employees through mentorship relationships and gives them a vision for a future within your company. This also builds your company’s reputation as a place where employees are actively valued.
Evidence suggests that by promoting leaders from within has a success rate of 70-80%.
However success rates drops to 50-55% for external leadership hires. Succession planning and growing your own means you can do better than flipping a coin. (Global Leadership Forecast, 2014-
Reduced Turnover of Staff
“Job-skills training is a shared responsibility between leaders and employees,” says David Ballard, PhD, assistant executive director of the APA’s Center for Organizational Excellence. “If you want to have a healthy high-performing workplace, and if you want to succeed as a business, you have to do this.”
If you don’t, chances are your employees will jump ship. A 2015 survey by Gallup found that when 93% of Americans advanced in their careers, it was by taking a job at another company.
Just 7% took on new opportunities within their current organizations. When they walked out the door, they left with institutional knowledge and a hit to their previous employers’ culture and employee morale.
According to some studies, the overall cost of replacing a salaried employee without a succession plan in place is an average of six to nine months worth of pay. While it doesn’t eliminate all costs — for example, a succession plan will still require some training for current employees — you can minimize the costs associated with on boarding as well as downtime from unfilled positions.
By training employees and investing in their career development, you can make them feel valued by your organisation. This will lead to longer employee tenures and less turnover. Going to the market to replace a leaver will be more expensive.
External hires cost 18% more than the internal promotes in the same jobs. In addition to scoring worse on performance reviews, external hires were 61% more likely to be fired from their new jobs than were those who had been promoted from within the firm.
Succession Planning is critical for all generational groups,however there is strong evidence that the largest group (Millennials) need these plans in place to ensure that you retain their loyalty.
In 2016, Millennials became the largest share of the American workforce; one in three US employees between the ages of 18 and 34. With baby boomers retiring, it’s vital that organisations find strategies to attract and retain young workers.
Millennials are the leaders of the future, and 53% aspire to become executives. But only 6% of companies reported they had “excellent” programs in place to develop Millennials in 2015 (Global Human Capital Trends, 2015).
In 2016, only 7% of companies had accelerated development programs for Millennials, but 44% said they were making progress on development for Millennials. If you’re not making progress, you’re behind (Global Human Capital Trends, 2016).
Millennials have a high need for frequent feedback. This isn’t just an annual review for them, but an entire, ongoing series of coaching conversations with their manager. Relationships with managers and the ability to learn new skills are vital, this can be delivered by succession planning.
Succession Planning breeds loyalty and grows the culture positively.
Succession Planning Steps
Succession Planning needs to be communicated widely and often, ensuring that all of your people understand the intention and the opportunities that are open to them should they wish to get involved. The steps to undertake the Succession Planning process are not onerous, however if your organisation executive are not fully invested emotionally and financially in the successful delivery of the initiative then it will fail.
Your own Development will be linked to your succession planning and your Personal Improvement Plan will require these steps to identify your future growth.
Invest in your people and they will invest in you.
High level Succession Planning Steps
- 1 – Identification of key and critical roles –
- Responsibilities and skills expected from the role itself
- 2 – Identification of potential successors
- Ideally two to three candidates
- Communicate openly with candidates, explain process
- Give the candidates a choice to participate, this takes commitment from the candidate also
- 3 – Development plan for candidates
- Identify development opportunities for candidates vs roles
- SMART development goals (Specific, Measurable, Achievable, Relevant and Time-bound)
- 4 – Keep an open mind
- You may just find someone out there in your company, organisation or team who might just surprise you.
What is your experience in Succession Planning and do you have any advice for those setting one up?