Succession Planning for Organizational Survival and Growth

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Author(s): Tom Mc Kenna is president and managing partner of OI Partners-Mc Kenna & Associates (Albany, NY)

In today's business world with its ever-changing and challenging environment, organizations need to effectively develop skilled employees to maximize performance and retain their talented workforce. By promoting key individuals into key positions and grooming them for succession within the organization, careers are advanced, employee satisfaction is improved, attrition rates are decreased and the organization reaps the benefits of diminished recruitment costs, along with assured organizational survival and growth. However, succession planning can be so much more.

INTRODUCTION

Succession planning is defined as the process by which companies plan the hiring, training and development of employees to assure comfortable mobility from one position to the next as part of an organization's long-term growth plan. At one time, succession planning focused on top-level positions. Today, that is not the case. Succession planning must focus on the development of all people, not just the candidates with the highest potential.

For succession planning to be successful, there are key components that cannot be overlooked. First of all, an organization must have a strategic plan, which incorporates succession planning with its short term objectives and long-term goals. Unless an organization identifies these with regard to changes in direction, growth and future development, succession planning cannot be instituted. A strategic plan will recognize that the organization's future leadership may differ markedly, in qualifications, characteristics and skills, from leaders of the present. This allows an organization to identify the needs and focus on training and development programs. It is also the reason why the talents of all personnel should be considered.

The choice of elements to be included and the complexity of the succession planning system itself depend upon the needs of the organization. Moves within a hierarchical organization may cause a simple, straightforward ripple effect down the chain of command. In other organizations, career paths may be both horizontal and vertical. Some organizations may need broadly trained individuals with generalized talents, while others may need managers with specialized skills unique to that department or unit. Regardless of complexity however, the conditions necessary for successful succession planning and implementation are dependent upon:

* A clearly defined mission and business purpose for the organization * Supportive corporate personnel * A perception that succession planning is a strategic priority

When instituting succession planning, time is a factor that should be given serious consideration. Senior executives and CEOs often want quick action so they can see their plan in place immediately. However, trying to do too much too fast is not realistic. Implementing a systematic succession program requires significant time and effort.

TRAINING, DEVELOPMENT AND ASSESSMENT

The primary task of succession planning is to plan a sequence of personnel moves so that candidates for key positions are known in advance. As already noted, succession planning has traditionally targeted middle management to top executive positions and often tapped into specific positions to find talent and potential for development. However, the focus should be on the development of all people, not just the candidates with recognized potential because as things change, employee potential may also change. Individuals who may not have skills that could benefit the organization today, may possess talent that can benefit the organization of tomorrow. This is where training, development and assessment become crucial.

Rigorous assessment is the first component and must be conducted continually. Individuals, at all levels, are assessed for talent and potential and the overall organization must be assessed for progress in meeting goals and objectives and for changes in direction. These fit together and must be done in tandem. It is important that employees are assessed at regular intervals. The vice president for leadership and organizational development for Lockheed Martin in Bethesda, MD, says that they reassess employees every year. Their approach to talent management requires the company to identify three candidates for every key position in the company. When the position is vacated, one of the three will be targeted for succession. This tactic, in addition to recognizing readiness to advance, will most definitely assess gaps in management succession.

Assessment also has a direct and profound impact on training and development programs. Once assessments are complete and potential positions for employees are recognized, programs may need to be designed to lead employees to develop skills and garner knowledge associated with the position. In addition, training and development must be designed to educate other employees to learn new skills or improve upon those which they already possess.

Thus, assessment and training go hand-in-hand to: * Recognize candidates who can move into key management positions immediately and identify individualized development activities so that when the individual assumes the new position, transition is smooth and their ability to function in their new role is optimal.

* Identify potential candidates that may be outside the area or department for which they could serve the organizations' needs as well as their personal career goals.

* Ascertain candidates, at lower levels in the organization, who show promise and to then design training and development that will increase their knowledge of the organization and enhance their skills and performance.

OUTCOMES OF A SUCCESSFUL SUCCESSION PLAN

Truly successful succession planning requires that an organization do more than just identify positions that will need to be filled and potential employees that might fill them. When succession planning is working fully, it ties an organization's current talent and needs to future direction. What results is a corporation that:

* Develops future executives from a personnel pool that is already part of the organization

* Broadens performance skills and potential of all employees

* Creates a diverse organization through the development of all employees

* Recognizes that the future of an organization requires new roles to manage new business

* Guarantees that management of new business growth can be easily done

* Moves toward a proactive learning organization

* Recognizes that increasingly demanding and escalating competencies are required to understand business as a whole

* Improves morale and increases commitment and loyalty

* Saves the organization from facing ever-expanding recruitment costs * Assures better survival in today's challenging business environment

SUMMARY Organizations need to take succession planning seriously. It is not something to be ignored. The consequences of not being prepared to replace key executives or able to recognize the need for new positions within the company, can have a major impact on productivity and success of an organization. Organizations that prepare for tough times, changes in the global economy and respond to the need to develop a skilled and diverse workforce, will be more competitive and better able to meet the challenges of the future.

Tom Mc Kenna is president and managing partner of OI Partners-Mc Kenna & Associates (Albany, NY). The firm just celebrated its 21st year in business.

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