Succession planning is an essential part of talent management for any growing business. As a business grows, so does its workforce. It’s therefore essential to have a plan in place to replace staff in key positions should they leave to take on a new role within the business. It’s not only crucial for business operations, but for retaining staff and maintaining productivity and morale.
Succession planning is just as relevant for small businesses as it is for large corporates. Think of it as part of your business strategy, understanding the critical roles in your business and the talent you need within your business. If you lose a key member of staff and haven’t considered this scenario, operations could be affected. It’s also about spotting employees with potential, which in turn boosts engagement and can help with morale, building the next generation of leaders.
There are numerous benefits to creating a succession plan:
- Future proofs the business – ensuring that if a key employee leaves the business is prepared and that person can be replaced quickly without interfering with productivity.
- Increases staff motivation – by identifying future leaders and those with potential to help staff feel valued and recognised.
- Aids retention – if more junior employees can be a clear career path they are less likely to move on to progress their career. This in turn saves time and money spent on recruiting external candidates.
- Helps shape training and development – succession planning can identify gaps in the business and areas where staff could benefit from professional development.
How do I start succession planning?
Who should be involved in succession planning?
Depending on the size of your business you might want to include senior members of the team or those who have a good understanding of the roles within your business to help with the process.
Its worth booking out some time to have a meeting to start the succession planning process, its easier to
It’s important to take an annual review of your critical roles to ensure they are still relevant.
- Start by identifying critical roles in the business
The definition of what is a critical role is unique for each company and varies between industries. It also varies over time, as a company grows roles that were once critical may reduce in importance and vice versa.
Its worth noting that it’s not just senior roles that can be defined as critical roles, there might be key administrators or assistants’ positions within your business that would have a huge impact if they were vacant.
In identifying critical roles it’s important to ask these questions of each of your roles:
- Are these roles working on projects/products that will drive the future growth of the business?
- Are these roles performing activities that others in the organisation cannot do or are not equipped to do?
- If we lost someone in this role, will it result in business disruption or potential loss of revenue?
- Are these roles doing something that has a direct impact on the reputation of the company?
- Are these roles contributing to building organisation capability in a way without which the future of our business will be in jeopardy?
The key factor to remember is that it’s the role and not the person in the role, they might have a specific personality or way of doing things and are vital to the team but they need to be identified as key talent, not a critical role.
- Ensure all job descriptions are accurate
Successful succession planning only works if job descriptions are accurate and up to date. This will help to skills match and understand the skills needed for each role. Consider an HR audit to understand where the business may need to make improvements.
- Succession planning critical roles
Once you have identified the critical roles within your company then you need to map out who would be the successors for the role and identify their readiness as to when they would be able to take on the role.
Developing a talent matrix can help to easily identify internal succession candidates. Talent matrixes allow you to develop an understanding of employees’ current knowledge and skills, and what knowledge/skills gaps they would need to fill to be a suitable succession candidate.
Using the talent matrix, you can regularly assess the pipeline of talent within the team to see how they are developing, and help identify areas where you can aid their development, for example through involvement in new projects to develop skills they currently lack.
To ensure the talent matrix is effective, every year it should be benchmarked against external talent, to ensure internal candidates are up to the same standard.
You may also identify gaps in your business where there are no natural internal successors. It’s important to come up with a plan for how to fill these roles should they become vacant. You might want to consider longer notice periods for these roles to ensure time to find a replacement and arrange a handover.
- Plan the handover process
To help improve the handover process’s chance of success, where possible the predecessor of the role should meet with the successor of the role so the predecessor can offer insights into how the role works and the expectations of the board. Additionally, stakeholders should be involved in the process through regular communication.
Having a written plan, that includes a timeline for the changeover of roles and responsibilities, can help ensure a smooth transition. The plan can be strengthened through the involvement of senior management.
An HR Consultant can facilitate a succession planning session with you and provide templates and advice. Get in touch if you would like our help.
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