It is said that if you fail to plan, you plan to fail. This fact explains the inherent benefits of succession planning well.
In contrast, when your business is doing well and the economy is strong and you are looking forward to a successful financial future, it can be difficult to think about what might happen to your organization if you suddenly disappeared.
In succession planning, a company ensures that the right leaders are always in place so that in the event of a sudden change, the company always has the right leaders at hand. If your company fails to create an orderly succession plan after a key player leaves or passes away, it may not get a second chance.
Ultimately, you cannot predict when a serious illness, accident, disaster, or pandemic will strike, but you can take steps to prepare for such occurrences.
Although succession planning may seem time-consuming, there are six major ways it can benefit your business.
Succession planning has the following benefits:
To protect your company from hurricanes, floods, and fires, you purchase insurance. Your company installs security systems against theft. To protect your business’s proprietary data, you back up data to an off-site location.
Business owners are often so busy running their businesses that succession planning does not get the attention it deserves. There is a possibility that these leaders believe they are too young to fall ill with a serious illness. It may not occur to the company that a key player (or several), who is critical to the success of the organization, could be lured away by a competitor who needs the skills they possess and is willing to pay top dollar for them. A business can become vulnerable in each of these scenarios.
Regardless of whether you are physically present for the company’s long-term success or not, succession planning is an important part of your senior leadership’s business strategy. You may be afraid to start the conversation, but the sooner you work on your succession plan, the sooner you are able to secure your business for the long haul.
You can think of it as employee grooming insurance for business continuity.
Finding the best-qualified candidates for future leadership positions.
For your company to implement a formal succession plan, you must:
- Determine the positions that are most important to the success of the company in the future. This list may not include all C-suite positions.
- Choose candidates within the organization who have the values, skills, and desire to perform those essential duties.
- Discuss career plans and interests with potential candidates.
Succession planning involves these important steps, which have several benefits. An org chart audit helps your leadership take a closer look at potential weaknesses, and can stress the urgency of cross-training key employees.
Alternatively, if there are no suitable internal candidates for leadership roles, then you should begin conducting an external search shortly.
One benefit of succession planning is that it provides a sense of validation and recognition for ambitious and less-experienced internal candidates who are capable and deserving of promotion. Junior managers and subject matter experts who wish to advance into management can use this as an incredible retention tool and motivator.
Developing structure to support training and development.
A variety of methods can be used to enhance employee development, including coaching, mentoring, job shadowing, and gradual increases in responsibilities..
The candidate may even need to go back to school to get additional educational credentials or a professional certification for some positions.
As a result of taking advantage of potential successors early, employees will have time to acquire the skills and experience they will need to succeed in their new positions. Investing in your employees’ growth as well as your company’s is another way to show your employees you care.
Making sure that an extra eye is on a job.
Developing top prospects could be the best way for your company to grow and prosper. When a junior manager discusses why they are doing things the way they are with their senior leader, this can happen.
Explaining the status quo is a simple means of uncovering weaknesses in processes and procedures, exposing potential sales opportunities, and uncovering opportunities for change. Your company will benefit from this natural process by keeping an extra set of eyes on its senior positions and encouraging you to question outdated or inefficient corporate norms.
The consequence of succession planning is that it allows your company to be future-proof.
As a result, retiring employees can serve as sounding boards to resolve customer complaints, address questions, and resolve other issues. These efforts ease the transition between employees.
Planning for the long-term to benefit the company.
The pace of change is accelerating. Planning for the future is easier when you know where your company is heading.
Positioning succession as part of your company’s overall growth plan will provide retiring employees with a foundation for passing on their years of hard-earned knowledge and transitioning important working relationships before they depart.
A succession plan should strengthen your company’s ability to grow with intent by identifying and planning for potential vulnerabilities in other business areas. Succession planning may also provide benefits in the areas of identifying which areas require innovation, setting realistic business growth goals, and planning for future talent requirements that may arise from this growth.