Nobody starts a business with a closing date in mind. Everyone wants their business to succeed for the long-haul, and this is why succession planning is so important. Without a succession plan, your company will ultimately reach its limit.
Succession planning ensures that businesses continue to run smoothly and without interruption, after key people move on to new opportunities or retire. Succession planning is a good way for companies to ensure that businesses are fully prepared to promote and advance all employees – not just those who are at the management or executive levels.
Important Factors to Consider When Developing a Succession Plan
Not everyone can do the job
Who is responsible for succession planning? I regularly hear this question. It’s simple, but often misunderstood. Succession planning may seem like it should be a job for leaders on the executive level, however, it can be a mistake to put the responsibility in the hands of a CEO. Top-level managers may have an overall understanding of the running of the business, but they rarely have front-line experience with the team, as well as an in-depth understanding of the day-to-day running of the organisation. Line managers, on the other hand, have an on-the-ground discernment of both the job requirements and the employees. Line managers are in the midst of the team, and this makes them ideal for the job.
It starts with recruitment
Want to have a good succession plan in place? Start at the recruitment phase. The goal is to choose candidates who are capable of rising through the ranks in the future. The solution? Hire for character. If a candidate is passionate about the industry, and has the right soft-skills under their belt, the rest can be developed over time. The more employees you hire with this mindset, the more likely you are to find a diamond in the rough. When you can look at an employee and say, “If I pour a little gas here, there’s going to be a fire”, you know that you’ve found strong leadership potential. Identify the small flames. It may take 3-5 years to develop an employee to the point where they can step into the role, but this is what good succession planning looks like.
Look at the position before the person
Let me tell you how I got a job as General Manager for a hotel a couple of years ago. 6 years after I left the hotel as Divisional Manager, I got a call from the owner encouraging me to apply for the post of General Manager. Right off the bat, this tells me that the company was intentional about finding someone who fit the job, rather than simply seeking out the most tenure employee to move up the ranks. They saw something in me that made them believe I was a good fit for the position and the level of leadership, putting emphasis on the role first.
It’s important that you understand the role before you hone in on a candidate. This is a process very few organisations understand, and therefore very few get right. If you want to promote continuity of leadership in your business, it’s crucial that you focus on the job requirements first.
All organisations can benefit from the principles of identifying critical job skills, knowledge, social relationships and organisational practices and passing them on to prepare the next generation of workers, thereby ensuring the seamless movement of talent within the business.
The period where I have seen too many businesses fall short in succession planning, is during the process of choosing an employee into whom they invest their time. Many companies look at the employees who have been there the longest, or who win awards like “Employee of the Month”. The big problem here is that these employees may work well where they are and with their current duties, but may perform poorly in the position you are aiming to fill. For example, you may have pinpointed the best performing software developer on your team, but this doesn’t qualify him/her to step into the role of a line manager. They may work well in a team, but can’t necessarily provide the vision, self-motivation and leadership skills needed to manage a team.
It’s also important to be mindful that you’re not being led by personality alone. A ‘self-promoter’ can be a dangerous pick if they are all personality and all talk, but can’t follow-through on their promises. You simply can’t choose a person and fit them into the job; you must analyse the job first, and then find the right person to fill it.
The Benefits of Engaging in a Succession Plan
An effective succession plan will:
- Ensure business continuity,
- Cut recruitment costs when you hire internally,
- Foster shared culture and values,
- Promote a smooth transition period where employees can learn from leaders,
- Identify skill gaps and training needs,
- Retain institutional knowledge in a knowledge economy,
- Boost morale and retention by investing in employees,
- And replace unique or highly specialised competencies within job roles.
Why Training is Critical for Succession Planning
Traditionally, succession plans identify potential replacements for key positions, while training and development is meant to improve the skills of the individual and is seen as a benefit provided by the company. The advantage of combining training and development with a succession plan, allows an organisation to better prepare for the emerging talent shortage and the uncertainty of the future. This uncertainty is heightened when employees (especially ones with high-potential) move from organisations more regularly.
Most importantly I would say succession planning, especially when combined with a training and development program, has a huge impact on the bottom line of the business. This combination means that when there is turnover, instead of HR desperately searching for a good fit for a key position, they have already trained someone with the exact skill set that they are looking for. This saves the business, as ultimately, internal promotions tend to cost less than outside hires.
A training and development plan is an investment in your human resources that will pay massive returns in productivity. Ultimately it guards against potential losses, but will also pay further dividends in employee retention, productivity, innovation and stable leadership.
We have the experience to assess your team and create a development plan that will groom an employee to step into a role – fully equipped with the necessary skills.
Contact Summit today and we’ll partner with you to curate a plan that ensures your leadership legacy lives on.
About the Author
Nathi grew up in a small village of iXopo where he was nurtured as a young boy, before he moved to Durban. He was raised with no parents around him, but grandparents who helped him through to Grade 7. Nathi funded his own education from Grade 8 to Grade 12 by means of a small job at a catering company in Parlock, Durban. The weekend job enabled him to clothe and feed himself, as well as pay rent in a small shack owned by one of his relatives.
His good eye for talent is attributed to a former General Manager of The Royal Hotel Phillip O’Hely, who took upon himself to develop Nathi in the industry by putting him through tertiary education. Nathi became a trainee manager at The Royal Hotel, in conjunction with The International Hotel School in 1999. He finished his qualification and continued to work for the group. He then travelled to the United Kingdom where he worked for Britannia Hotel and Six Continues Group. Nathi is a hotelier who has developed a passion for L&D. During his 22 years in the hospitality industry, he imparted knowledge and skills, with an aim to nurture individuals who had a desire to grow in the industry.
Nathi holds a Diploma in Hospitality Management through American Hotels and Lodging Association. He also holds a Post Graduate Diploma in Educational Management and Leadership through Regent Business School. He is pursuing his MBA in Educational Management. Nathi is currently writing a book on his life experiences with the hope to encourage others who are finding themselves in hopelessness.
At Summit, Nathi is responsible for all Facilitation, with his immediate team of Senior Facilitators. He liaises with clients to ensure satisfaction. Nathi also facilitates some management development programs, and is especially passionate about learning and development.