There are many reasons why succession planning in a business doesn’t always go to plan. This could be that there is a limited pool of qualified internal candidates, poor advice from key advisors, or a reluctance to take on the task in general.
Fears around succession planning come – rightfully – more often from smaller or mid-size companies. Given the current economic realities, many small businesses are focusing more on “keeping the lights on” than creating a succession plan. It’s with these kind of situations, you may want to do some research into what approach works for your particular business. Either way, as studies suggest, failing to address succession needs can have dire consequences.
To carry out a succession plan effectively, consider these stages listed and, in doing so, take the steps to preserve the continuity of your company.
STAGE 1 – Start at the top
C-Level engagement is crucial to ensuring company confidence is behind the succession process. CEOs, CFOs, COOS and all other C-Level executives need to set the stage for the process – this will guarantee that employees feel reassured and positive throughout the process (which won’t just happen overnight, but may possibly take years to plan and enact).
Without executive leadership, most succession strategies fail to get going. Develop a business case for succession planning which sets out a vision and a long-term plan for the business.
Alongside senior executives should also be the HR department, who can ensure that a fine balance is maintained throughout the process between a data-driven and a people-centric approach.
STAGE 2 – Your approach to the process
The best succession plan is multi-level. Not only does it set out arrangements for senior and executive roles, but also for critical roles that are several levels below the most senior roles in the company.
Similarly, an approach that considers unconscious bias is also a strong one. Women and culturally diverse employees traditionally (but not always) have less experience, and so try and go about your plan with gender-neutral and race-neutral standards. This will encourage inclusion and provide support to those employees that may desire extra training.
Lastly, think also about identifying your “at risk” roles which can be given extra thought when creating your succession plan.
STAGE 3 – Develop potential leaders
Succession planning presents opportunities for employees (or next-generation leaders, if you are a family-run business) at your company to take on more responsibility. They can step up to the mark on certain tasks that you, as a leader, may have reverted away from whilst focusing on your succession plan.
Ensure that you consider your talent within the company before seeking external candidates. Apply a rigorous assessment to your succession plan to determine whether you have the internal, high-potential candidates. This saves time and money down the line.
If this does not work out in your favour, supplementing with outside expertise is also beneficial as it brings fresh skills and new visions.
STAGE 4 – Document the process
Throughout the process, make sure to note down each action and step you have taken, so that, when the process is over, you have a depth of information ready to inform future processes.
It is especially important to remember the particular demands of each key position – not every position requires the same approach, and you may be surprised that positions several levels below the C-Level actually take more time and dedication to fill.
