Asking the big questions about sucession planning, where it fits in to the organisation and who should be included with Chris Berry.
Which individuals in your organisation really need to have a succession plan developed for them? Is it just board-level executives, or perhaps each member of the senior management team? Or are there other individuals in key roles elsewhere in your organisation that are indispensable today – like the technology expert who understands the intricacies of your HRIT system, or the payroll specialist who carries years of detailed knowledge in their head?
These are the kind of questions organisations should be asking when they develop a succession planning strategy – questions that in practice are too often overlooked. In fact, succession planning is probably one of the more under-deployed HR disciplines. Many organisations carry out minimal planning of this kind, and as a result, may expose themselves to significant problems. When Computers in Personnel was recently asked to carry out trend analysis across one of our customer’s employee data, for example, one of the first issues we uncovered was that eight out of ten people in senior management positions were due to retire in the coming three to five years, something that would have created a severe leadership crisis if left unaddressed.
Even when some level of succession planning does take place, it’s often restricted to the top management team, with the focus on grooming successors to the CEO, Finance Director and other key executives. But focusing solely on senior positions is a little short-sighted. There are critical roles across every organisation, some of them requiring specialist skills – such as sales account management – and others requiring specialist knowledge. What distinguishes them is the scale of the impact on the business when the incumbent leaves. So it’s a business priority – not just an HR nicety – to determine what the critical roles are in every department, identify existing employees who might grow into the role and launch a development plan for them, or start to research potential hires.
Just as important, rather than seeing it as a standalone HR exercise, succession planning is better viewed as one piece of a broader people management strategy that links performance management, competency management, employee development, recruitment and overall workforce planning. By identifying key roles and adding a clear set of objectives for developing successors, it can bring a new perspective to other HR disciplines.
Take recruitment. If you identify key roles as part of a succession planning programme, by implication you’re acknowledging that some vacancies are more important than others to fill. This in turn should influence the way you prioritise your recruitment campaigns, as well as the way you measure recruitment success. Instead of measuring average ‘days to hire’ across your organisation, for example, you may want to drill down into how quickly you can fill critical vacancies.
Secondly, knowing which roles are critical to the business gives you more options when you engage with high-quality candidates. It’s not uncommon to come across talented applicants who aren’t suitable for an existing vacancy, but who could bring value to the organisation as a new hire in another capacity. In the past, one or two organisations have gone as far as hiring high-value individuals even when there’s no specific vacancy for them, with the sole purpose of sliding them into critical roles as gaps appear – although that approach is unlikely to get the green light from many finance directors in today’s economy.
Taking a more holistic approach to succession planning does of course require a more joined-up approach within HR itself. This is partly a mindset issue: if your HR team thinks with a stovepipe mentality, then succession planning and other key disciplines will inevitably be carried out in the same way. So each discipline needs to be seen as one component of the overall picture.
But it’s also about the underlying processes and systems that support these key HR disciplines. Managing the links between business objectives, performance appraisals, recruitment, employee development and succession planning is much easier if you have an underlying HRIT infrastructure that can manage data and workflows across the different disciplines. Ideally this will be built around one central database containing all of your HR data, with integrated processes linking cross-discipline activities. Many established HR Management Systems have the functionality you need to run these core disciplines and come with pre-integrated processes, although in some cases you might choose to integrate additional third party services for specialist requirements. Regardless of the approach, the logic is the same – to build an effective succession plan, you need to work in the context of your overall people management strategy.
Chris Berry is Managing Director, Computers in Personnel