Succession Management: Ensuring Workforce Continuity in a Rapidly Changing Landscape
As organisational, environmental and market factors continue to shift, succession management is becoming increasingly important to our clients.
Building a future-ready workforce is crucial to your organisation’s long-term success. Well executed succession management plans identify and develop employee talent, enabling you to quickly and smoothly fill key positions when the need arises.
A proactive approach to succession planning strengthens your organisation by:
Reducing recruitment costs: Succession planning reduces the need for external searches. Minimising the time and financial resources spent on recruitment and leadership development frees up your organisation to focus on its work.
Retaining and engaging employees: Providing career pathways and advancement opportunities demonstrate your commitment to your employees’ development and growth. That translates to increased employee engagement, job satisfaction and retention.
Mitigating talent shortages: Effective planning increases the availability of the right people, at the right time. Critical roles are easily filled when experts advance or exit.
Ensuring continuity of leadership: The risk of losing valuable experience when executives move on is mitigated. Experience, capability and institutional knowledge are passed on through targeted development initiatives.
Creating a diverse talent pipeline: Traditional leadership pipelines, where managers make siloed decisions when identifying successors, create room for bias and favouritism. Succession management can create a more inclusive and equitable leadership landscape.
Encouraging inclusive leadership behaviours: Communicating to your successors that inclusive leadership behaviours are important to their progression leads to a more diverse and culturally competent organisation.
In response to the current economic outlook, organisations are understandably looking to be more targeted in their recruitment and development spend. Succession management is an investment that addresses recruitment costs, reduces organisational risk and fosters internal development.
Nurturing workforce continuity is a no-brainer, but it can be difficult for organisations to identify the best approach. Our experience tells us that it should be a well-planned out, long-term process, building a number of talent pools of high potential internal talent.
Identify critical roles for now and the future: Start by identifying key roles or leadership levels within your organisation that significantly impact on operations, the future of the organisation, or that require specialised skills and expertise. This normally includes top leadership positions, technical specialists and other critical functions.
Consider how changing conditions will impact your organisation: Anticipate what skills you will need for the future to execute your strategy. Some important questions to consider include:
If the role became vacant, what will be the risk for the business? What impact will it have?
How difficult will it be to fill the role?
What is the typical turn-over rate for the role?
Do you have people internally who could step in?
Yes? Great, but are there any gaps that need to be developed?
No? What is the external market like for this role, and how does this role compare to others in the market?
Create a succession planning framework: Develop a framework that outlines the process, responsibilities and timeframes. Identify the key competencies that are required for the critical roles and assess your existing talent against them. Do you already have a good understanding of the competencies and skills of your existing workforce? If not, there are a range of ways to collect this information. We explore one potential option in the case study below. Diversity is also a key consideration when drafting your succession planning framework and it's important to ensure alignment with your DE&I objectives.
Understand your talent: Draw on existing data (if available) or collect data to understand strengths and gaps within your current talent. Identify high potential employees who demonstrate strength in the desired competencies and target development to give them what they need to step into the identified roles.
Calibrate results: Bring the assessment information and existing data together and provide it to decision-makers so that they can determine next steps for the organisation and participants. It’s key to be transparent about the information that is being used, what it’s used for, and the outcomes that are attached. Remember to provide clear and transparent feedback to participants.
Use insights to create development programmes: Review your results to understand strength and development areas. Design and implement targeted development initiatives to address any gaps, including targeted training, leadership courses, mentoring programmes and stretch assignments.
Focus on cross-functional experience and exposure: Offering opportunities for cross-functional experience to a diverse mix of employees builds a broader and deeper level of skill and experience in your talent pools.
Monitor and review progress: Succession management is not static. Plans need to be regularly reviewed, adjusted and updated to align with evolving business needs and strategies. It is also important to have an engagement plan in place for successors to keep them within the organisation.
Succession management is an essential practice enabling high-performing organisations to prepare for leadership transitions and ensure continuity in the face of talent shortages and unexpected changes.
By identifying and developing internal talent, businesses can reduce recruitment costs, foster employee engagement, and build a sustainable leadership pipeline.
Embrace succession management as a strategic investment in the future, and watch your organisation thrive.
This client wanted to future proof its executive level, invest in high-potential candidates, and ensure the organisation had the diversity needed to reflect its customers and drive it into the future.
We worked with the decision-makers to set criteria that outlined what success looked like for the roles that were identified as critical, and designed a way to assess these competencies.
Robust performance data was unavailable, so the client opted for a holistic assessment to measure applicants’ potential and performance compared to the criteria. Employees could either apply directly to be a part of the programme, or they could be nominated (which ensured more diverse applicants). The assessment approach consisted of a leadership exercise and interview, as well as psychometric testing.
Applicants’ results were then considered by a senior leadership development board, which was stood up as a part of this mahi. The development board assessed the talent on their potential and known performance and framed next steps for each applicant. Each applicant was taken through a robust feedback process where they were given a clear view of strength and development areas and what their next steps could be.
Development programmes, acting opportunities and appointments were led and monitored by the board. Close oversight and governance ensured that a wider range of people received opportunities and exposure to different business groups. This ensured a diverse and skilled talent pool for when future roles opened up.
Through this programme the client was able to:
Set robust criteria for the competencies that would drive them to the future.
Reframe ‘merit’ to include key leadership skills, cultural competence, and diversity and inclusion.
Identify talent that was not previously on the organisation’s radar and get these people the exposure and experience to move from being high potential to ready for promotion.
Proactively consider the diversity of talent required and be purposeful in moving away from favouritism with acting opportunities.
Use data to identify strength areas and development areas for both individuals and the cohort to inform talent decisions and measure bench strength.
Create better governance over opportunities and appointments for critical roles, reinforcing the understanding that talent management is a key competency for senior leaders.