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Succession management

Succession management
• Succession management refers to the process of ensuring that pools of skilled employees are trained and available to meet the strategic objectives of the organization. • It consists of two things; identifying the high potential employees and preparing them for future challenges. • The ultimate test of good management is succession management - Drucker

. Can your firm weather this vacancy ? ..Succession management (contd. succession management is still important. • Most of the baby boomers would retire very soon..) • So how does succession management work in family businesses ? • Akij group vs.. Eastern Housing • Goldman sach vs.. Gordon capital • Even when retirements are predictable...

• Increase the talent pool of promotable employees. • Identify replacement needs as a means of targeting necessary training. • Contribute to implementing the organization's strategic business plan . employee education and employee development.Reasons for succession management • Provide increased opportunities for highpotential workers.

• Improve employee morale • Cope with the effects of voluntary separation.Reasons for succession management(contd. • Improve employee's ability to respond to chaining environmental demands. • Tap the potential intellectual capital in the org.) • Help individuals realize their career plans within the organization. .

and – Improving the evaluation system . – Creating a talent pool of replacement.Evolution of Succession management • Replacement planning refers to the process of finding replacement employees for key managerial positions. • Replacement planning has turned into succession management – Broadening the focus – Expanding the time horizon.

• More than promotable now (PN) and Ready with development (RD) • Succession management believes that people have more than a single career within the organization • Based on more than subtle future • Think about BTCL .Broadening focus • In replacement planning the starting point is job. whereas in succession management the starting point is the strategy of the organization.

Time horizon • Replacement planning is all about immediate and short-term replacements • Succession management is more concerned with long term replacements .

• Succession management might involve more than a single rater and may even include 360 degree evaluation.Rating system • Traditional replacement planning is depended on the identification of the replacement people by a single rater. . usually the supervisor.

• Talent pool is a good description of the next generation of talented leadership because the term implies fluidity and responsiveness to the impact of forces.Talent pool • Neither employer nor employees can trust each other for rest of their lives. high competitive pressure. . • Globalization. de-layered organizations and new technologies have compelled to have a diversified and well equipped pool. environmental turbulence.

Talent pool • Is it only internal pool or does it include external candidates as well ? .

All rights reserved. 8–12 .Talent pool choice Copyright © 2002 SouthWestern.

then does it make any sense to start with the job approach ? .SM process (contd.) • Identify the skills and competencies needed to meet strategic objectives – Job based approach – Competency based approach – If the job keeps changing.

SM process • Align succession management plans with strategy – For a firm going global what sort of competencies or skill do they require? – What percentage of its current workforce can represent your firm in the world ? • Identify the skills and competencies needed to meet strategic objectives .

– Strategic replacement: more than just performance – Talent management culture: why would a talented person want to be here ? . not a good match for a rapidly changing organization. tend to focus on current strength and weakness.) • Identify high-potential employees • Once the competencies are identified we need to find those in employees.SM process (Contd. – Temporary replacements: should the manager who fails to pick a successor be ever promoted? – Replacement charts: usually done through performance appraisal.

– A ‘lifestyle’ company where employees want flexibility and a good relationship with the boss. which offers great potential for advancement and compensation. which is characterised by growth and development.Talent management • Nearly one third of HR directors at topperforming companies constantly search for talented executives. compared to less than 10% at average-performing companies. . – A ‘winning’ company. big reward’ company. – A ‘big risk. which is attractive to those wanting a mission. – A ‘save the world’ organization.

Provide development opportunities and experiences • Are leaders born or made ? Branson vs. involves psychological investment as well. • . ? – Job rotations : More skill vs. 3M uses freedom for mentoring. Monitor succession management. Harvard graduate • Make or buy ? Barcelona vs. Short run mentality and cost to learn new skills – Special assignments: international assignment – Formal training and development: formal university education – Mentoring and coaching: more than counselling and coaching. Real Madrid • Management development methods: – Promotions: does it work for flatter org.

Short run mentality and cost to learn new skills – Can develop an area specialist through rotations – Better job satisfaction – Vulnerable to mistakes – Special assignments: international assignment – Mistakes must be tolerated – Formal training and development: – formal university education .Provide development opportunities and experiences Management development methods: – Promotions: does it work for flatter org. ? – Job rotations : – More skill vs.

• Monitor succession management. advise. – 3M uses freedom for mentoring. involves psychological investment as well.Provide development opportunities and experiences • Management development methods: – Mentoring and coaching – mentors are executives who volunteer to coach. • How do you measure ‘success’ of succession management? . – Coaches tend to be external members. usually paid counsellors from outside – Involved more than counselling and coaching. and encourage junior employees.

Employee role in succession management • Have we shifted from psychological contract to return to explicit contract ? .

Some other issues • Elitism : from hero to zero ? • Risk of the spotlight: why reveal who is a star employee and risk of losing him/her ? • Unpredictable future: pass the ball where not the player is. but where he is going to be • Selection bias: – The criteria for selection is inappropriate and/or inadequate – Various strategies of evaluation throughout the organization – Rating errors .