Why Your Business Needs a Succession Plan

Why Your Business Needs a Succession Plan

Most organizations have a succession plan in place, but very few give importance to it. This is a recipe for disaster as organizations will not be prepared for job vacancies due to retirement or future attrition. In fact, succession planning is part of every successful organization’s strategy, as it allows them to use the potential of internal candidates to meet their requirements, thereby achieving their corporate goals.

A succession plan begins with identifying employees with high potential, who can replace key employees should these employees leave. Once identified, the employees’ skill sets are studied carefully to see if they meet the needs and requirements of the company. If there is a gap between skills and requirements, the employees are given training to bridge the gap. They are also provided with shadow opportunities to show their abilities. This becomes a testing phase and allows companies to determine whether they picked the right internal candidate.

A succession plan is vital to the growth of any organization, be it big or small. Often companies go off the track, for the simple reason that they do not have a goal and succession plan charted. If your organization has not thought about a succession plan seriously, here are some reasons why you should have one in place before it is too late.

Identifying Future Leaders

With succession planning, an organization can identify employees who have potential and help them move up the corporate hierarchy. These are employees who will become future leaders of the organization and help meet business goals in a more effective manner. When employees are identified, the focus turns to providing adequate training, so that their performance improves and the organization is benefitted as a result.

Cost Savings

A succession plan means the organization does not have to spend money advertising and looking for talent outside. Then, there is the added cost of training the external candidates and making them understand the policies of the company and also getting them familiar with the values, products, services and customers of the organization. The only cost the company will incur with succession planning is training the internal candidates to improve their performance in areas that are weak.

Talent Retention

When an organization can provide a clear roadmap to employees about their career, it helps motivate them to perform optimally and meet their departmental and organizational goals. Furthermore, when high-performing employees know what they can expect from the organization in the future, they are more likely to stay with the company for a longer period of time. So, basically a succession plan helps to retain talent, which otherwise would have moved on to greener pastures.

Allows Companies to Look at the Big Picture

There are some organizations that believe succession planning is all about top level executives. This is far from the truth. In fact, a successful organization should be looking at all levels of employees, including those who perform routine and mundane jobs that keep the organization going. It is imperative your organization has a mix of succession planning, so that all levels of employees are high performers and achievers. It is only then that your business can meet its goals and leave competition behind.

Remember, succession planning is more than training. While the training equips high-potential employees with skills, knowledge and abilities to meet the needs of a future vacancy, assessing possible weaknesses and vulnerabilities is equally important. Organizations must identify and train employees to become ideal successors.