Why your Organization Needs a Succession Pipeline for Key Positions
How often do you hear hiring managers lamenting about their inability to fill a vacant top position quickly? Do you know some even lost their jobs because they hired someone out of pressure who couldn’t deliver on the job? It is said that 6 of 10 hiring managers in most developing countries go through this problem.
Lack of succession pipeline is a major problem faced by lots of organizations. Today, you will know how it affects businesses and how to overcome them.
What is Succession Planning?
Succession planning can be seen as a modern technique followed by many companies that concentrate on identifying the prospects, out of many employees in the organization, who might be possible successors, for the key positions.
Succession planning helps companies identify high potential candidates and prepares them to assume senior positions as the positions become available. Organizations with good succession plans tend to be little troubled when a high profile employee leaves the organization due to retirement, resignation, termination, transfer, promotion or death.
Here are 4 benefits of having a Succession Pipeline Strategy
1. Continuity: When an employee leaves an organization unexpectedly, there is a threat of disruption, especially if the vacancy is at the executive level as they would be scrambling to find a replacement quickly. Losing a mid-level employee may not sound like a serious setback, but their absence often results in other employees having to divert time from their tasks to handle those of the vacated position until a replacement can be found.
By establishing a firm succession strategy roadmap that identifies leadership positions and the potential candidates who might eventually fill them, companies can better anticipate the impact of sudden changes as employees depart or move throughout the organization. They can also ensure that potential candidates are prepared to step into new roles with minimal adjustment, allowing the business to continue to operate smoothly no matter what personnel challenges they’re forced to address.
2. Low Cost of replacement: Hiring new employees is a time-intensive process, one that doesn’t immediately translate into revenue. It carries significant hidden costs. A Harvard Business School study found that the typical mid-level manager needs 6.2 months to reach a “break-even point” in terms of cost and productivity. Setting aside the cost of hiring, integration, and training, new employees function at about 25 percent productivity after completing their training. Even after three months, the average employee is only functioning at about 50 percent productivity.
Effective talent succession planning can reduce much of these costs by identifying and preparing internal candidates to fill positions as they become available. Internal searches are cost-effective to conduct and since candidates are already familiar with company policies, training costs will be reduced as well.
3. Improved Engagement: Employees are more likely to be committed to an organization when they know they have a clearly-defined future. They see that they are important and valued, which encourages them to take greater ownership over their work.
Knowing the organization’s plans for their next potential opportunity—and that there is one—reinforces the desires for career development and career opportunities. This development is one of the areas that employees want most from their employer.
4. Better performance results: Developing formalized succession strategy forces organizations to consider what competencies are required for critical positions. These models help to identify and develop the characteristics effective leaders need for success, ensuring that potential candidates in the succession pipeline are better prepared for their roles. For organizations with shifting strategic goals, creating success profiles for key positions allows them to craft their development programs to prepare leadership candidates to focus on skills and competencies that will be relevant when they’re ready for promotion.
How healthy is your organization’s succession pipeline?
Lots of organizations do not have an active succession pipeline. Succession planning is valuable to any organization looking to avoid the disruption that comes from unexpected vacancies and, it also comes with several benefits. Establishing a robust leadership pipeline puts companies on a strong footing to deal with changing circumstances and adjust to challenges in the short and long term.