Succession planning – why it’s important and how to do it

If you’ve watched the Netflix show Succession, then you’ll have a pretty good idea of what can go wrong when businesses don’t plan for the transition of power or responsibility.

The show follows the war waged among siblings for control of the family-owned multi-billion-dollar media empire when their father and company overlord falls ill. Parallels with real life aside, its cast of loathsome characters is almost as compelling as the storyline.

High drama and rich entertainment, for sure – but what it also teaches anyone in business is how important succession-planning is, and what can go wrong when you don’t have a plan, or the plan is flawed.

What is succession planning

At its heart, succession planning is about identifying who should move into one or more key roles should the current postholder leave the business, and then preparing the successors for the moment when they move into those roles.

Whilst many businesses focus their succession planning on the senior roles within the organisation – primarily the C-suite – you should have a succession plan for any business-critical role that has an impact on the progression and success of the organisation.

Effective succession planning is achieved through a series of steps that ensure that when it needs to be implemented the transition is smooth and seamless.

Identify your key roles

Yes, everyone who works for you is important, but not all roles are created equal. Senior people are obviously integral to your business and the likelihood is that your executive posts – CEO, CFO, CPO, etc. – will be among those to feature on your list.

But there may be others in junior roles whose departure you would want to plan for – for example, if you have a sales rep who’s generating an exponentially large percentage of your revenue, you’ll want to know that gap could be filled by an equally high performer.

You need to assess your team and the role architecture of your organisation and ask your self what the impact would be if the person currently in the role left. This impact may be financial, but it may also be a risk in terms of the efficiency of their team or department.

Next, you should identify those roles where the risk of not being able to quickly find a like-for-like replacement would be harmful to the business.

Who are the successors?

Often, this is the tricky part of the process because what many business leaders discover is that they don’t necessarily already have someone who might be ready to take on a particular key role.

Successors aren’t always those who may consider themselves to be next in line, either. Be sure to consider promising junior staff who may be one or more steps below the role you’re succession-planning – and identify a way to fast-track their progress if necessary.

Let’s assume, though, that you do have a strong potential internal candidate. What, if any, are their development needs in order to be up to speed when the time comes?

If your performance review and employee development processes are effective then these can be helpful in identifying those colleagues who have a desire and ambition to build growth in their careers, and those who might be less inclined to take on new challenges, even if they may have right skills and knowledge.

Tell your intended successors

Naturally, it’s important that this part of the succession process is discreet, especially if your plan doesn’t include a member of staff who might expect to step into a particular role. In private meetings, let your successors know that you them progressing into key roles in the future, but also ensure you are clear that there are no guarantees and that things can change.

Start making practical arrangements

Whether it’s continuing to implement – or beefing up – an individual’s existing development plan, creating a new one, giving someone additional responsibility or creating new role opportunities for them, you need to take practical action to begin their journey into the role you’ve identified.

You may also want to think about establishing some mentoring support and ensure that the individual you’ve identified has regular touch points with you to assess, monitor, and review their progress.

Test drive your plan

Every organisation has periods when there is an opportunity to give someone the chance to experience life in a more senior role or a role with greater responsibility.

If you have a manager or leader taking annual leave, on sick leave or perhaps going on a sabbatical or extended break, take the opportunity to have one of your successors cover for them. They don’t necessarily have to cover in the role they’re being prepared for – they’ll benefit from any additional knowledge or experience.

Succession plan in your hiring strategy

Where you don’t have an internal solution to a future gap, ensure that your recruitment strategy is designed to identify and then bring in the talent that is needed. Ensuring your future needs are reflected in the people joining your organisation in the short-term is always a smart strategy.

But remember – once they’re in, ensure you have a robust and effective plan to retain them, because good people are always in demand and if an individual doesn’t get the experience they were expecting, they’ll soon be looking at other opportunities.

Plan to replace yourself

One day you will also leave the business – whether it’s for pastures new or a planned retirement, you won’t be working forever. So, at some point during your succession planning process, make sure you identify – or hire – the person who will eventually step into your own shoes.

If you’d like to find out more about how to create an effective succession plan, get in touch to talk about how Constantia Consulting can help you to identify the right people for the future success of your business.