Succession Planning – Managing Risk
Succession planning is the process of identifying and developing new leaders. New leaders may be needed to replace an employee who is retiring, one that has been promoted, to fill a vacancy caused by turn over and or to fill a new leadership role created to expand the company. It’s a risk management strategy that increases the availability of prepared and qualified people as the business grows, adds new employees, new services and or loses a key employee. It’s also one of the best ways to retain, inspire and reward employees.
No matter the size of your company, this activity starts at the top. The leader is responsible for the people who are responsible for the customers. Leadership is a learned skilled, preparing your people to lead is one of your most important duties.
Here are a series of steps to consider at least once a year to help you include succession planning as a risk management strategy in your annual business plan.
- Identify critical positions in the company which require highly capable employees.
- Identify the most competent person for each specific critical position and what the consequence would be if that person were to leave, be promoted, and or become temporarily out of service.
- Identify people in the organization that are likely candidates to advance into those critical positions when the time comes. These transitions can be planned in the case of a promotion, or in the case of an emergency the company is prepared to minimize the impact.
- Identify success profiles for all critical positions. If you are on top of this there should be job descriptions to review for this information. If not, that is a good first step to developing a success profile.
- Create development plans for successors to ensure they are ready to assume future roles.
Develop a complete employee development plans to address the gaps. Budget time and resources for leadership training.
Begin by getting your key players involved to help with identifying critical positions and highly capable people. At first people can be threatened with this type discussion, as it may appear you are getting ready to replace them. Communication needs to be handled well and if it is, you will find it is something that is welcomed. The process allows people to see benefits and opportunities that they might not have seen before, for themselves, others and the company.