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Approaches To Comprehensive Succession Planning
What is Succession Planning?
Note on terms used
The term “Succession Planning” and “Succession Management” can be used interchangeably.
In this presentation, the term “Succession Planning” is used, but can be taken to mean “Succession Management” as well.
” Minimum disruption. . Retention of “institutional knowledge.What is Succession Planning? The short answer: Managing key personnel transitions for Maximum continuity of operations.
What is Succession Planning? In the past. . it is important to include key positions in a variety of job categories. succession planning typically targeted only key leadership positions. In today's organizations.
employees are ready for new leadership roles as the need arises. and when someone leaves.” A pending transition of a leader or key employee may also be seen as an opportunity for change. succession planning can help develop a diverse workforce.Why Succession Planning? “With good succession planning. “In addition. a current employee is ready to step up to the plate. by enabling decision makers to look at the future make-up of the organization as a whole. .
Aligning the organization’s human resources strategies accordingly. Understanding the organization's long-term goals and objectives Identifying the workforce's developmental needs Determining workforce trends and predictions Then. .Comprehensive Succession Planning involves: First.
but should be strongly coordinated with other organizational planning. It should be tied to the management of all the transitions that your organization is now facing.Beyond replacing people… Succession planning should include not only planning to replace people. . or will one day face.
.Succession Planning The growing necessity for Succession Planning.
.Two reasons why Succession Planning is becoming more important than ever: 1. 2. The management principles growing out of “organizational excellence” and “quality” movements are becoming standard practice among successful organizations. Population trends show that the rate of retirements of workers will increase in coming years.
Succession Planning Population and Demographic Trends .
Workforce Trends By 2010. the number of 55-64 year-olds has expanded by 52 percent. . While the number of 35-44 year olds. those normally expected to move into senior management ranks. has actually declined by 10 percent.
What is the impact of these population trends? What exactly does the exit from the workforce of the Boomers really mean to organizations? How serious is the “coming retirement crisis”? .
500.000 4.S.000 3.500.500. Births.000 2.000 0 10 20 30 40 50 60 70 80 19 19 19 19 19 19 19 19 19 90 Births Year .000 500.000.000. 4.000 1.000.000 2.500.000.000 1.Population Trends US Births 1910-2000 by Year U.000 3.
S. 4.000.000 0 10 20 30 19 19 19 19 1945 1975 Births 40 50 60 70 80 19 19 19 19 Year 19 90 .000 1.500.000 2.000.000.500.000 1.000 3.000 2.500.The Baby Boom US Births 1945-1975 by Year U.000 3.000 4.000 500.000. Births.500.
000 2. and is trending down. There are many other factors that influence retirement rates.500.000 1. 20 50 70 80 90 00 10 20 30 20 19 19 19 20 20 20 Year Reaching 60 20 40 .” They simply add 60 years to the birth data.000 500.The Baby Boomers turn 60 Projected Retirements Boomers Reaching Retirement Age *These numbers do not represent the number of “workplace retirements.000 0 Average retirement age is now about 63.500.000 2.500.000 1.000.000. Retirements * 4.500.000 3.000.000 4.000 3.000. The round number 60 is used here for simplicity.
000 3.000.000 4.000 1.000 3.000.500.000.000 500.000 2.500.000 1.500.000.500.000 2.000 0 Retirements 70 80 90 00 10 20 30 40 20 19 19 19 20 20 20 20 Year Reaching 60 20 50 .Where we are now on the demographic curve Projected Retirements Boomers Reaching Retirement Age 2006 4.
000 3.000.000 1.000 500.000.000 3.000 2.6 million per year 4.500.000.500.000.000 4.000 0 Projected Retirements Boomers Reaching Retirement Age 1990 2005 Retirements 70 80 90 00 10 20 30 40 20 19 19 19 20 20 20 20 Year Reaching 60 20 50 .000 2.What we’ve gotten used to in the previous 15 years: About 2.000 1.500.500.
a 70% increase Retirements 4.000 4.6 to 4.000.500.000 0 Projected Retirements Boomers Reaching Retirement Age 2008 2023 70 80 90 00 10 20 30 40 20 19 19 19 20 20 20 20 Year Reaching 60 20 50 .000.4 million per year.000 2.000 500.000.000 1.500.000 3.000 1.500.000 3.000.000 2.What we can expect over the next 15 years: Growing from 2.500.
org/overview/numbers.How will immigration affect retirement rates? “Ellis Island” The Baby Boom Period http://www.html .susps.
html .susps. they are now about the same age as Boomers born in the 1950s. a decade in which over 40 million Boomers were born. in the 1970s.org/overview/numbers. http://www.Impact of immigrants will be considerably less than that of Boomers… Just over 4 million immigrants entered the U.S. If their average age at entry was 20.
exceeding native births. Yes. but the greatest impact of immigrants on retirement rates will lag behind the Baby Boom factor.What impact will immigrant population trends have on retirement rates? Immigration rates are harder to analyze because of age at entry and other factors. This will contribute significantly to rising retirement rates. the number of immigrants has been increasing dramatically in recent years. .
. the rate of increase will be gradual over the next 15 years. At it’s peak in 15 years. the rate will approach twice the number of retirements per year compared to what we’re used to.So how serious is the “coming retirement crisis”? The number of retirements per year will increase over the next 15 years. However.
adopting succession management practices now will enable organizations to cope with increasing retirement rates successfully. . but not an immediate emergency… This means that the rate of loss of institutional knowledge and leadership will be as much as double what we’re used to. in plenty of time. However.Serious.
Succession Planning The Impact of the “Organizational Excellence.” or “Quality” Movements .
This success led to Total Quality Management and all the other modern approaches to organizational excellence.Organizational Excellence or Quality Movement The adoption in Japan of Edward Deming’s quality circle and continuous improvement concepts resulted in tremendous gains in quality and value. .
Deming’s Quality Circle Adjust Plan Check Do .
These widely-agreed-upon best-practices are represented by the Malcolm Baldridge and Florida Sterling award criteria.Organizational Excellence or Quality Movement Over the years. research and experience have refined these concepts into a number of widely-agreed-upon ideas about what constitutes excellent organizational practices. .
Process Management 7. and Knowledge Management 5. Analysis. 3.The Seven Sterling Criteria: 1. 2. Leadership Strategic Planning Customer and Market Focus Measurement. Human Resources Focus 6. Organizational Performance Results . 4.
3. but these 4 represent the bulk of the necessary analysis. Analysis. Leadership Strategic Planning Customer and Market Focus Measurement. planning.Succession Planning is chiefly concerned with 4 of the 7* 1. 4. Process Management 7. and other actions. 2. development. Organizational Performance Results *All 7 Criteria have succession planning implications. Human Resources Focus 6. . and Knowledge Management 5.
We’ll use these four Sterling areas to frame our examination of Succession Planning. Leadership Strategic Planning Measurement. Analysis. and Knowledge Management Human Resources Focus .
Succession Planning and Leadership What are the competencies required of leaders? .
Leadership Dictionary. direction: The business prospered under the leadership of the new president. Guidance. .Com definitions: Capacity or ability to lead: showed strong leadership during her first term in office.
Proportion of necessary broad skills at various levels Executive Manager Supervisor Worker .
The Leadership Challenge Model The Way Enable Others To Act Find your voice Set the example Foster collaboration Strengthen others Recognize contributions Celebrate the values and victories Inspire A Shared Vision Encourage The Heart Envision the future Enlist others Search for opportunities Experiment & take risks Challenge The Process .
The Qualities of Leadership Collaborative Inventive Skilled Visionary Mindful .
Survey results Interpersonal Skills Problem Solving Conceptual Skills Project Management Coaching *Technical Skills 77% 75% 63% 58% 47% 41% *Technical Skills as used here are the competencies that are specific to your business or industry. .
Your best technical people may seem like a likely source of promising leaders. but do they also have the necessary “soft” skills? .The “soft” skills are critical to leadership. Yes. a fundamental understanding of the business you’re leading is necessary.
Succession Planning and Strategic Planning Strategic Planning must precede Succession Planning .
Vision. Organizational Mission. and Values. Strategic Plans Long-term Goal & Objectives Strategic alignment within the organization .You have to know where you are going in order to plan to get there. Succession Planning cannot occur without broader organizational planning.
The people working in these areas.Strategic Alignment Organizational Mission & Vision Organizational Strategic Plans Organizational Goals & Objectives Areas of responsibility in achieving these goals & objectives (“departments”). .
. Sustainability of the organization. Adapting to changes in technology. Adapting to anticipated changes in markets. Facilitating growth. Adapting to new business processes. service requirements. etc.Succession Planning is inextricably linked to Strategic Planning.
Before planning for the succession of key personnel. Define Mission. know where you want to go. Goals & Objectives. But of course stay flexible and plan for change. See that your current business processes and organizational focus are aligned with your vision and strategic plans. . Values.Strategic planning precedes succession planning. Vision.
Analysis.Succession Planning and Measurement. and Knowledge Management Preserving and Sharing Institutional Knowledge .
but what would be lost to the organization? Former White House Chief of Staff Andy Card developed what he called a “Hit By A Bus” list. for example)? Of course it would be personally & humanly tragic.A morbid. but useful. question to ask about each key position: What would happen if a particular employee were to suddenly disappear (sudden accidental death. .
what knowledge will your organization lose? It’s easy to take for granted the wealth of knowledge stored in our brains.Knowledge Management With the departure of key leaders and other critical personnel. How do we do this? . Succession planning seeks to capture and retain the “institutional knowledge” that would otherwise be lost when key people leave.
wellintegrated systems for Communication Learning Documentation .Knowledge Management World-class organizations have developed effective.
Values. Strategic Areas of responsibility in achieving these goals &then which Plans. Organizational Goals & Objectives Vision. Innovation. objectives (“departments”). Learning. Mission. MVV & Objectives Planning The people working in these areas. Research.Communication: Vertical Organizational Mission & Vision Communicated Communicated Results. Down: Organizational Strategic Plans Up: . informs Goals.
. How measures of performance are communicated up the org chart. How progress on action plans is monitored.Communication: Vertical How will the departure of key people affect things like How strategic plans are translated into action plans. How action plans are assigned and communicated down the org chart.
Communication: Horizontal Organizational Goals & Objectives Area 1 Area 2 Area 3 “Everybody on the same page” .
Will the information gained by one area be available to those from another area who need it? . How information about the organization’s activities is shared.Communication: Horizontal How will the departure of key people affect things like Coordination of activities between areas. How one area knows where to go to find organizational support or resources.
.Learning How will the departure of key people affect the availability of External Knowledge Industry practices Industry history Markets Industry trends Key Contacts Etc.
.Learning How will the departure of key people affect the availability of Internal Data Customer knowledge Unique characteristics of individuals Efficiency & effectiveness of processes Sources of materials and information Etc.
.Documentation Documentation is used here to describe the process of capturing and preserving the “Institutional Knowledge” that will be lost when key people depart...and to make it available to the people who will replace those who depart. .. Quit “reinventing the wheel” with every major personnel transition.. in order to make it permanent and useful.
Accessible to all who need it Require everyone’s work to be Organized systematically (standardized document management policies & procedures) Accessible & Transparent . plans. activities. etc. procedures.Systematize Documentation A systematic approach to documentation is essential for succession planning Of policy.
Mature Systems Legally mandated and regulated systems are usually relatively mature. And have been shaped by practice and necessity over many years. . Many of your documentation procedures and practices have been prescribed by law. However. not all your processes may be welldocumented.
Policy & Procedure Manuals If they exist at all. update the manual. Systematically update these manuals. update the manual. Easier than ever to do (online or with word processing) . If you issue a policy memorandum. they are often out of date. If you implement a new procedure.
Develop systematic approaches to planning and project management. but is complicated. Microsoft Project is a good tool. such as Goals Personnel involved Budgets Timelines and checkpoints Approvals . You can adopt some of it’s key features yourself: Develop a simple form that outlines the important aspects of major projects.
Succession Planning: Human Resources Focus Planning for the Succession of Key People .
senior management). It may focus on all important leaders (i.Human Resource Focus Succession planning often starts with planning for the replacement of a single key leader (i.e..e. It may also focus on Historically difficult to fill (or train for) positions Key technical positions Less desirable locations or specialties Mission critical positions . the founder)..
6.A step-by-step approach: 1. Identify key positions Decide on the initial scope of your SP efforts Identify competencies of selected positions Identify internal and external talent pools Create internal and external selection and recruitment processes Create and support employee development processes . 4. 5. 3. 2.
Work your way down to mid-level managers and key technical positions. Identify key positions Start at the top of the org chart. Prepare a list of all the positions for which succession plans are necessary or helpful.1. .
Prioritize the positions for which you want or need to develop succession plans. Consider your organizations other long-range plans and trends. Decide on scope Plot the career trajectories of people in key positions on a timeline. Develop a long-range schedule for implementation of succession planning for the identified positions. .2.
for each position.” Consider. Develop lists of skills for key positions. the required Knowledge Skills & Abilities Attitudes . Identify competencies of selected positions This is easier to do with technical positions than with leadership positions. “Job (or Task) Analysis.3.
Consider other characteristics of the selected positions
Determine challenges you’ll face in replacing people in particular positions, i.e., Scarcity of potential candidates Training and development issues Identify any other general human or professional qualities that your organization wants to have in it’s workforce (Values).
4. Identify talent pools and paths
Assess your internal talent pool first. Assess existing position structure. Look at the history of your hires and promotions. Identify entry level positions. Are there natural career development paths? Can you alter the structure to create such paths?
Assess performance potential.
Aptitude testing Employee Performance Evaluation System, including 360° evaluations
Preferences expressed in employee’s individual career development plans. Find strength in diversity
High performance + aptitude + career motivation = Potential
Top 7 competencies used to identify highpotential employees Decision-making (74%) Performance exceeds expectations (74%) Drive for results (66%) Analytical skills (63%) Potential in another function (63%) Problem-solving (59%) Cognitive ability (52%) .
Identify institutional sources: Colleges. . technical schools. Research your industry’s labor market. Identify like or related organizations: Can you offer incentives to lure talent? Identify appropriate employment services. etc.External talent pools Look at the history of your hires and promotions Identify entry level positions. military.
Announce. and support the effort. establish an internal promotion culture. . Selection and recruitment processes Internal selection and recruitment Create career progression paths. For open processes. Communicate clear lines of job progression. Decide how open or closed your recruitment processes will be. Follow through: promote from within. publicize.5.
Implement a systematic recruitment. assessment. Establish relationships with institutional talent sources. .External selection and recruitment Where did your existing workforce come from? Target the most promising external talent pools. and hiring process.
Align training and development plans with succession plans. & Values. Create and support employee development processes Integrate training and development plans with with Mission. . Implement systematic training and development paths and options to develop the competencies identified as necessary for the organization. Vision. and Strategic Plans.6.
and help them achieve them.6. Create and support employee development processes Discuss each employee’s personal and professional goals. . Create “career pathing” plans for each employee. Make and sustain the commitment to develop employees.
Mentoring Pairing Apprenticeship Cross-training Team assignments Job rotation Shadowing Coaching .Create a plan to systematically pass on the wisdom of senior workers.
Benefits of Mentoring.. Provide for greater continuity of operations in unexpected (i. “Hit by a bus”) situations. Give the employee a chance to evaluate potential career paths. Provide employees with advancement opportunities Supports succession plans. Cross-training. Adds to assignment flexibility.. . etc.e.
Succession Planning Challenges and Recommendations .
3. 2. Finding the right employees to develop Time for the process Buy-in by senior leaders Organizational issues such as downsizing or mergers Implementation and follow-through Assessment and measurement Losing talented people .Seven Common Challenges Organizations Face Related to Succession Planning 1. 5. 6. 4. 7.
Identify talent from multiple organizational levels. 3. Receive active support of top leadership. .Recommendations: 1. 2. Link to strategic planning. or with critical skills. early in careers.
Recommendations: 4. 6. such as diversity. Address specific human capital challenges. 5. and retention. leadership capacity. Facilitate broader transformation efforts. Emphasize developmental assignments in addition to formal training. .
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