Succession Planning: A Guide for HR Professionals
Succession planning does more than fill seats when a critical position becomes vacant. An effective succession planning strategy cultivates future leaders, boosts employee engagement, and safeguards business continuity by preparing for future roles.
HR plays a vital role in this process. As Prudence Pitter, a business executive with 27 plus years of HR leadership expertise and Global Head of HR, Auto/Mfg and Healthcare & Life Sciences, Amazon Web Services, discussed at Workhuman Live Austin 2024, a strategic succession plan is a game-changer, boosting not just the company's bottom line, but also its cultural stability.
Keep reading to learn how to build a talent pipeline and succession plan that secures your organization's success, one strategic step at a time.
What is succession planning?
Succession planning is an intentional process that ensures leadership continuity by preparing for future leadership roles that will eventually need a successor. It goes beyond the traditional notion of a family member stepping up or fighting to take over as the next generation.
Instead, succession planning is a comprehensive approach to replacement planning for organizational leadership roles. It involves identifying and developing internal candidates who have the potential to fill key positions.
This proactive method ensures that an organization remains resilient and capable of achieving its long-term goals, even in the face of unexpected changes.
Why succession planning is important
By focusing on leadership development, preparing for future leadership roles, and managing leadership transitions, succession planning helps maintain stability and fosters a culture of growth and preparedness within the organization.
Let’s look at the benefits of succession planning and adopting a long-term perspective and proactive approach:
1. Ensures business continuity
Unplanned departures in critical roles can disrupt business operations. Succession planning ensures that your organization can continue its operations seamlessly, even when unexpected vacancies occur.
2. Develops future leaders and builds a talent pipeline
HR plays a pivotal role in nurturing talent for leadership positions. Identifying and developing high-potential employees via skills profiles and talent marketplace platforms can ensure a steady flow of leaders ready to take on new challenges.
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3. Boosts employee engagement and shows investment in your people
Succession planning demonstrates to employees that there are opportunities for career advancement within the organization. When an organization shows an investment in its employees, it can significantly enhance employee engagement and retention.
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4. Improves knowledge transfer
A well-designed succession plan incorporates knowledge transfer from senior employees to their potential successors. Preparing future leaders ensures that valuable institutional knowledge and expertise are retained within the organization.
5. Forces strategic talent management
Succession planning encourages HR to take a proactive approach to talent management. By identifying future talent needs, HR can develop targeted recruitment and development strategies to fill any potential gaps.
The succession planning process
A well-structured succession planning process involves several key steps:
Identify key positions
The first step in the succession planning process requires HR to plan ahead and focus on talent management. Start by identifying critical roles – positions that are essential for business and have a significant impact on the company’s success – within your organization that will need successors. Compile a list of these critical positions and move forward to the next step.
Then, look towards the future by forecasting critical roles in the future. Assess future talent needs by analyzing current and future business goals.
Build your talent pool
Next in the succession planning process is understanding where your talent or successors are coming from. By examining the key competencies of critical roles, develop strategies for identifying high-potential employees who can fill these key roles in the future.
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Use talent assessments, performance reviews, skills gap analysis, and peer feedback from an employee recognition program to evaluate your internal talent pool and identify potential successors. Peer feedback can help you uncover hidden gems that have flown under the radar and single them out for development as leaders of tomorrow.
Once you identify internal candidates, focus on enrolling them in talent development programs to close any skill gaps. Beyond the cost-saving and benefit of trust, another pro of internal candidates is the institutional knowledge they bring that helps support business continuity.
Keep an eye on external candidates and start the outreach and recruitment process with them when necessary. External candidates can bring a diversity of thought and fresh energy to an organization, but it can be tricky to know whether they will transition seamlessly into the culture.
Getting to know their personality and integrating them into the culture beforehand can be beneficial if you are down to the wire and need to decide on a replacement.
Document the succession plan
Pitter encouraged the audience that you just have to start somewhere. That might look like naming the plan, identifying a single candidate to develop, and establishing a leadership development process.
Document the key components of your succession planning framework. Establish clear, structured development paths for potential successors and detail the specific skills and experiences required for each role.
Don't be afraid to lean on technology – succession planning is a complicated and timely process. There are many succession planning softwares available for creating and monitoring plans, tracking development progress, and organizing data.
Consider adopting one to ease the burden and time constraints on HR and leadership so that they can focus on the human aspects of succession planning.
Implement and monitor
Successful implementation of the succession plan involves continuous monitoring and adjustments. Track the progress of your succession planning efforts and make necessary changes to address any gaps or common challenges, such as a CEO or founder’s reluctance to leave the organization, day-to-day business priorities taking precedence, and the inaccurate view that the transition of key positions must be immediate.
Tips for effective succession planning
Focus on diversity and inclusion
Diverse talent pools and individuals from underrepresented groups create more robust succession plans for future-proofing. Promote inclusive leadership by ensuring that your succession planning process is free from biases and reflects a wide range of perspectives and experiences.
Bias can be rampant in the succession process when leaders fall for affinity bias – choosing those to replace them who remind them of themselves.
Pitter cautions against promoting individuals just because they are well-liked and in the right place at the right time. This can lead to misalignment and regret down the line.
Communication and transparency
Being forthright about succession planning is imperative for those involved, but the organization's plan doesn't typically need to be communicated throughout the entire organization. However, keeping potential successors in the know is key. Pitter shares that this helps prepare them for a seamless transition into their new leadership role.
Beyond potential successors, clearly communicate the succession plan to all stakeholders involved. Transparency in communication builds trust at the executive level and motivates potential successors by showing them the potential for their career development within the organization.
Be agile
Having an open and flexible mind is critical for succession planning. A promising successor might unexpectedly leave the organization, or a critical role becomes more complex. Keep an open mind to fast-tracking someone’s professional development or leadership skills, or consider external hires when in a jam.
Continuous improvement
Succession planning is an ongoing process. While it is important to utilize press releases to share successful succession planning, Pitter advises against using a copy-paste method. Instead, regularly review and update your succession plan(s) to reflect changes in the business environment and incorporate new development strategies.
Conclusion
As we've learned, succession planning is more than just a strategy for filling vacancies; it’s about developing a talent pipeline that ensures the long-term success and stability of your organization.
By focusing on leadership development, talent development, and continuous improvement, HR professionals can create effective succession planning frameworks that benefit the organization and its employees.
About the author
Alicyn Zall
Alicyn Zall is a writer dedicated to creating a more equitable and fulfilling workplace. With a focus on actionable, data-driven insights, her work empowers individuals and organizations to foster positive change. In addition to her contribution at Workhuman, Alicyn has served as an editor at Harvard Business Review where she developed books and articles about mental health and the future of work.