Twenty-five percent of high-potential employees say they plan to change jobs within the next 12 months, showing potential attrition rate 2.5 times greater than just five years ago. And yet, 66 percent of businesses don’t see themselves as succession-ready (Source).
Demand for the best talent in organisations is highly competitive and rapidly changing. As a result, companies are increasingly seeing the urgency in establishing internal structures and strategies to prepare for current and future requirements. This demand is being fuelled by, among other things, the impending retirement of a large section of the workforce (Baby Boomers), enhanced mobility of talent globally and the changes being experienced in organisations resulting in the need for varying talent.
SO WHAT DOES THIS MEAN?
When implementing or expanding on succession-planning strategies, it’s important to conduct a detailed needs and organisational readiness assessment. This will allow you to not only understand the environment and possible change-management requirements, but it will also assist in shaping the approach, while ensuring the awareness and buy-in from employees, managers and executives. In short, it will help you avoid the common pitfalls in succession-planning and set your organisation up for success.
Having said all of that, let’s look at five reasons why succession plans typically fail:
1. There’s no follow-through
If an organisation has previously started succession planning initiatives, and not followed through or maintained them, this history may create negative perceptions toward future initiatives and planning. The process for setting up a succession strategy and plan needs to be simple and focused to ensure it is implemented.
2. Narrow succession-planning process
Previously focusing on just one level of talent, such as high-potential leaders, may have created a negative stigma (such as feelings of exclusion) for those employees not catered to. A successful succession plan is not as simple as just identifying the top team. It is necessary to assess and agree upon the critical roles across the full breadth of the organisation.
3. Lack of integration
Failing to integrate your succession planning initiative into other people-related strategies may have created the impression of “another isolated initiative”, drawing on additional resources, especially time. It’s vital to align the succession plan to the future, along with the strategic goals and objectives of the organisation.
4. Identifying unsuitable successors
Some leaders fall into the trap of picking someone like them or someone they like. It’s crucial to look at the business strategy for the coming years and choose a successor who’s aligned to the business goals and objectives. Different leadership qualities are required during different cycles and your succession planning should be altered accordingly.
5. Failing to plan
Having limited understanding of succession planning, the process and deliverables can set you up for failure. Managers may not have a clear line of sight between required actions, benefits and strategic objectives. Unclear roles, responsibilities and deliverables relating to succession planning may mean people are unsure and non-committal towards the process. Communication and planning is vital for a successful succession plan.
Succession-planning is a long-term process, but taking the first steps toward developing aligned strategies and plans, getting the basics in place, and maintaining commitment is crucial to success.
Australia Needs Future-Focused Boards Over Short-Termism
The business world is more competitive and the rate of change accelerating faster than at any time in history. Perhaps counter-intuitively, that means that it is crucial to deliberately build and execute business strategies with a future-focused vision.
Customer Centricity: Lessons From Top Organisations
Customers are your primary stakeholders. You need to understand how to live in their world in order to offer solutions that meet their needs. If you are not creating the biggest impact for your customers, then you are limiting yourself and your company’s potential. In order to develop your employees’ understanding of customer centricity, customer-centred coaching is necessary.
What Happens Next?
Vanessa Gavan, Maximus’ Founder & Joint Managing Director, features in QANTAS Magazine, alongside Chief Officers and Partners from McKinsey, Boston Consulting Group, Deloitte and EY, in a special business and technology report.