The Importance of Succession Planning to Business and Future Workforce Talent

The Importance of Succession Planning to Business and Future Workforce Talent

The saying goes,  “If you fail to plan, you are planning to fail.” If you are in charge of an organization whose economy is blossoming and the performance of the workforce is up to par, you may be immersed in the bright financial future of the organization. Due to this, you may have forgotten to think about what will happen if you are no longer available. This is where succession planning comes in and is an essential part of an HR strategy in terms of career development.

Succession planning is a way of preparing leaders to take charge of the activities of an organization in case of a sudden change. An organization that cannot get a solid replacement if a major player leaves – whether as a result of resignation, retirement, change in career, or death – may be on the verge of total collapse. As humans, we may not be able to predict occurrences such as accidents, serious illnesses, or a pandemic that may happen at unplanned moments.

In human resource management, succession planning differs from replacement planning as it does not involve preparing a single person to take charge of a specific role. Rather, it involves talent management by training a pool of talents at different levels who can assume leadership positions. As the business grows, expands, or experiences a major change this will not jeopardize morale and productivity. Usually, the employees are trained to possess the skills, energy level, and leadership qualities that will be suitable across the various roles, departments, and levels within the organization.

The benefits of succession planning include the following:

Business Protection

Just as lives and property are insured against disasters and security systems are installed in homes to protect from theft, succession planning is a way of protecting your company against setbacks. These may be necessitated by a key player or even several players leaving the company, thus leaving it vulnerable and less productive. Think of it as a business continuity insurance or strategy that requires training employees to fit into different levels of roles as long as the company exists. As a business administration executive, it would be out of place to think that you may be too young to be a victim of circumstances that can force you to leave a leadership position within an organization. In this situation, succession planning will serve as a company’s growth plan.

Structure for Training and Development

Once an organization perceives possible competency gaps, it is important that it begins to train junior employees for succession. However, the competency gaps might not be obvious at first, or it could occur suddenly. It could be discovered upon reviewing employee performance. Whichever way, closing the gaps could only be possible if there had been a professional development program – whether in the form of mentoring or coaching – at an earlier period. This is because there may be cases where such an employee may have to return to school to acquire additional educational certificates or more professional skills to be able to fit into the new role. All these are taken care of with effective succession planning.

Cost-saving Effect

Making an executive search could be expensive as the costs and organizational risk increase in the search for the right person with the right knowledge, skills, and talents to fit into a vacant position. In other words, when there is a need to replace key players, quality time and money have to be spent to find a better fit. Apart from this, such replacements need to be found within a certain time, which might not always be feasible. This can affect an organization’s productivity. Alternatively, filling leadership positions internally helps to cut down costs of hiring while also ramping up time and lost productivity. Therefore, possessing the foresight to develop existing top talents in preparation for the future is not only cost-effective but also critical to organizational success. An initiative that is followed in Malaysia is setting aside funds that are managed by an organisation called HRDF (Human Resource Development Fund). HRDF helps businesses upskill their workers by allowing them to do various certified courses offered around the country. The business invests in its employees to help fill these gaps at a low cost. 

Maintains Brand Identity

It is not uncommon to hear of managers who come from another company into a new company but end up drifting it away from its core values. Usually, such managers failed to understand the new company’s fundamental values and mission and only adopted their strategies without recourse to customer needs. Succession planning comes to take its place here. By identifying the need to train an internal successor, you can be sure that your company will be in the hands of someone who not only understands the company’s brand identity but also shares its values. This is because they have been immersed in it.

Processes of Succession Planning

Though the process of succession planning differs from companies, there are general guidelines that can be followed. They include the following:

  • Identifying the most important roles that would require immediate filling in case of an employee exiting the organization;
  • Defining the responsibilities and requirements for occupying such roles;
  • Assessing potential candidates using established criteria; and
  • Preparing workers who can fit into the key roles through training.

Conclusion

Leadership positions within an organization significantly impact it. Leadership falls within the scope of human resource management, a complex field as a result of the nature of its key area of focus – people. Working with people demands that you understand their intentions and emotions. You also get to understand how an organization is an interplay of individuals with different philosophies and drives. In this ever-evolving world, there is a need to keep up with changing skills and knowledge. A well-implemented succession plan is critical to achieving the goal of having enough backup for key positions. Succession planning helps you to grow as well as plan for vulnerabilities as they pertain to business continuity. 

To explore more, join our Executive MBA or our Master in Human Resource Management double certificate program with SHRM (Society for Human Resource Management) and IUKL (Infrastructure University Kuala Lumpur).  Drop us an email: info@eduk8u.com or visit our website www.eduk8u.com   

The Importance of Succession Planning to Business and Future Workforce Talent

Dr. Roy Prasad

Dean, EDUK8U Grad School Asia

Head of Executive Programmes

Infrastructure University Kuala Lumpur (IUKL)

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info@eduk8u.com

The Importance of Succession Planning to Business and Future Workforce Talent