101: Succession planning

Succession planning is a practice of successful companies to replace leaders when they leave an organization or retire. Knowing who will replace key leaders is something that should not be determined only in a response to a crisis – but be part of a framework – so the company does not miss a beat. When a company has employees already recruited and trained, there are benefits from all sides. It helps companies retain institutional knowledge. Now, more employees are hired and paid for how they think rather than the actual labor they contribute, according to the Society for Human Resource Management. Succession planning keeps that knowledge in house, with an orderly handing off of information and insight over time, preserving that investment. And, according to SHRM.org, more companies should be looking at succession planning as a way of preserving that institutional knowledge: “SHRM research on preparing for an aging workforce has found that less than 40% of HR professionals said their employers were analyzing the impact of workers over the age of 55 leaving their organizations in the next 10 years.” It helps employees know they are valued when they and others know they are part of a succession plan, says Susan M. Heathfield at TheBalanceCareers.com. “Employees who know that the next role awaits them receive a boost to self-esteem and self-respect. This enhances their efficacy and value,” she writes. She adds employees have said knowing an organization’s plans for their career development and future opportunities is something they want most from their employers. It saves money on recruiting. By having people with the correct skills already in house with professional development overseen by your organization for key roles, positions can be filled quickly and efficiently, writes CIO.com’s Hannah Williams. Suitable leaders are already familiar with your company, ready to work.