Designing effective succession planning solutions is more critical than ever before given financial pressures and the wave of retirements among most organizations. In our work with companies, we have found that the most effective companies at succession planning do three things:
- Create a strategic process for succession planning that involves identifying problem areas, gaps, and strengths, well in advance of need.
- Build talent pools of potential successors and career paths, based on an employee’s performance appraisal and potential, and the needs of the organization.
- Identify creative ways to retain high potential employees and involve them in crafting and executing their career development plans.
Many organizations do not have formal succession planning, career development or career pathing processes and react only when turnover occurs. When a company introduces a strategic succession planning process, it needs to be able to see the future and identify any holes or gaps before they negatively affect the company. By identifying skills and abilities needed for critical positions, companies have the opportunity to proactively source and develop internal talent.
Identification of Successors
Being able to quickly and accurately identify internal candidates with the right skills, experiences and qualifications to fill key roles is a common challenge. Organizations should not simply plan for the top executive roles but those roles critical to the company’s success or jobs that are hard to fill. In many organizations, critical roles revolve around revenue generation. However, in some companies the most critical role may be a research scientist. Assessment, performance management, and 360 feedback are among the most commonly used methods for identifying competencies for these roles and those employees with the highest potential to be succession candidates. Succession candidates get added or removed from the talent bench regularly, so make sure succession planning is an on-going process with regular meetings scheduled throughout the year.
Grooming Future Leaders
As a rule of thumb, companies should consider identifying two to three high-potential employees per role. By grooming high-potential employees earlier in their career, management is in a better position to make informed decisions about which employees are ready to transition from manager to leader, which employees require further development and which ones may not be ready to progress further. Once high potential talent pools are identified, companies must find creative ways to make use of career development plans to develop, engage, and retain these employees. These plans should outline skill gaps and provide them with necessary coaching, training, and managerial experiences to fully grow them into effective executives. It is also important to encourage executives to integrate physical and spiritual fitness to ensure holistic well-being.
Creating grooming opportunities make the difference between organizations that thrive and those that do not. It is important to enable employees to apply their new skills and knowledge as they gain them. Some organizations put these employees on special projects or task forces, while others have formal job rotation programs. One of the most important development options is giving these employees exposure to the senior executive team. This teaches them how to communicate and interact at a higher level in the organization.
Many reasons exist for developing high-potential talent but the most important reason is how employees feel they are viewed. By focusing on the identification and development of key employees, it sends the message that they are value, that they are important to the growth of the company, and that the organization cares about their career path. When employees know that the company is preparing them for greater responsibility, they are more engaged and often stay with the company for longer periods of time.
Effective talent management might be good for the bottom line, but there are likely to be budgetary restrictions in place for most organizations given our economic climate. Talent management does not need to be a costly program, and with the right tools and approach, there may be an opportunity to find more effective ways of developing leaders, refreshing your efforts, and integrating it to ensure it is strategically aligned with the business.