Developing a Succession Planning Program
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- Clyde Jordan
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1 Developing a Succession Planning
2 The business climate today is fluid. The speed of change is accelerating which means we always need to consider the future, identify where our customers are going and set ourselves on a trajectory which ensures we beat them there and are able to meet their needs. This process occurs in our long term business planning sessions and requires that we prepare our employees to accomplish the work of tomorrow.
3 Accomplishing the work of today is also increasingly challenging given the demographic changes which are tilting the field in favor of employees, leaving our businesses vulnerable to increasing turnover and the costs associated with that. That is why it s so important to identify and keep your top performers No matter how hard you try, there will be some turnover in your organization but this doesn t have to be a disruption. In fact, if managed properly turnover can present opportunities for you to engage your remaining employees and demonstrate your commitment to help them develop their career. With proper planning you can minimize the impact of changing market demands and turnover in key positions. Consider the following proactive steps which will position you to weather the storm. Phase 1: Evaluate Current State Succession planning requires an additional level of analysis, evaluation of your employee s competencies and skill sets and how those align with the needs of your business. Step One: Define the competencies/skill sets required for each position on the organizational chart. Step Two: Evaluate the competencies/skill sets of each employee. Step Three: Conduct a gap analysis for each employee (Note: you should gather data on competencies/skill sets which employees have but are not using as well. This information will be useful in Phase 2).
4 Step Four: Create individual development plans to address competency/skill set gaps. It is worth noting that in a static environment you would expect very few gaps in step three. Presumably employees are screened for required competencies and skill sets before they are hired or promoted. Over time, however, given the fluidity of the business climate gaps may develop. Phases two and three will help minimize this occurrence. Phase 2: Analyze the Future State Again, the succession plan requires an additional level of analysis, evaluation of the competencies and skill sets which will be required in the future state and how those compare to those of the current organization. Step One: Develop a future state organizational chart, identify positions which will go away and positions which will be added. Step Two: Evaluate the competencies/skill sets which will be impacted by these organizational changes. Step Three: Conduct an organizational gap analysis, which skill sets are no longer required and which must be developed or acquired (Note: in step three above you may have identified employees with future state competencies/skill sets. Make note of that here.) Step Four: Create an organizational development plan to ensure competencies/skill sets are developed/acquired in the time frame required by the business plan.
5 Of course any attempt to look into the future will not be a perfect science. As the analysis is repeated year after year though, patterns will emerge and confidence will grow. This is the nature of every aspect of business and it makes the process of evaluation and the discipline of preparation even more important. Phase three will help you implement the organizational development plan and prepare your business for the challenges of the future. Phase 3: Develop Succession Plan With phases 1 and 2 complete you are prepared to develop your succession plan. Step One: Identify current positions which are critical to the success of your current operation. Step Two: Identify positions which will be eliminated and those which will be added in the future state. Step Three: Evaluate incumbents* of positions which will be eliminated to determine if they have the competencies/skill sets required to fill the new positions, or to back fill for others who can. Step Four: Evaluate all employees* to determine if anyone has the competencies/skill sets required to fill the future positions, or if they have the ability to acquire them. Step Five: Construct succession planning maps** for all key positions, new positions on the future state organizational chart and positions likely to be vacated by promotions, retirement and/or turnover.
6 *Competency/Skill Set Analysis When evaluating employees to determine if they are a potential fit for promotional opportunities or likely future positions you should use a 5 block analysis based on each employee s level of Execution and Elasticity. Execution refers to an employee s performance against current job requirements and goals/objectives established in the performance review process. Elasticity refers to an employee s ability to move up in a standard career ladder or pick up new skills to meet future needs of the business (this could be in a new position or back filling for someone who moves). Keep in mind that your evaluation of their ability is only half of the equation. You also need to determine the employee s interest. Someone with the ability but lacking desire is not very elastic. The graph below is a tool for evaluating your employees based on these criteria. Relative placement in each quadrant is important as you attempt to differentiate between individuals. Those in the Elevate quadrant should be all over your succession plan and in many cases they may be back filled by those in the leverage quadrant. The shaded section in the middle, quadrant 5, will require your attention. I recommend that any employee placed in quadrant 5 be evaluated to ensure they are in the right quadrant. Once confirmed, move one direction or another to make their quadrant placement clear.
7 **Succession Planning Maps When constructing succession planning maps you will need to include several components. First, who is the incumbent and when do you anticipate the position becoming available for a successor. Then you will need to identify potential successors and sort based on availability (ready now, ready in 1 to 3 years or ready in more than three years). Below is the format for this sort of map in Excel.
8 Once the maps are complete then you will do an analysis of each person on your succession plan. Evaluate how many positions they are listed under, discuss the options with them to determine interest and for anyone who is not ready now, you will need to put a development plan together to adequately prepare them for the role in the selected time frame.
9 HR Value Partners is available to answer any questions you may have on this process and would be happy to assist you as you implement succession planning in your business. What's Next? HR Value Partners offers project based assistance with all phases of HR Management and Consulting Services. Let us know how we can help you. Learn more
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