Succession planning refers to the planned activities, processes and programs put in place by an organization or business to ensure smooth transfer of responsibilities and leadership roles to a succeeding generation of managers and top executives. Integral to the success and long-term endurance of corporate brands and organizational legacies, a well-mapped-out succession planning initiative helps maintain a company’s competitive position in the marketplace.
Succession planning involves planning for the smooth continuation of a business through the transfer of power between incumbent leaders and managers and succeeding ones. The key objectives are to maintain business and organizational continuity and cause the least possible disruption to an organization’s business operations and overall effectiveness. Succession planning ensures backups and exigency positions for each senior manager and leader in an organization. These managers are groomed to take over departmental roles or fill critical leadership positions during designated periods.
Senior peers, HR top management, top executives and even board members play a key role in identifying next-generation leaders and talented managers who will take over departmental or key functional roles. Based on organizational procedures and practices, HR top management have a fair idea about retirement plans, contracts or changeover in roles of incumbent top executives and accordingly have a succession plan in place. They apprise selected senior managers or business unit heads about possible new roles and extra responsibilities in the future; and devise a set of leadership training programs for these managers.
The grooming process is the key to the success of any succession planning initiative of an organization. The process of grooming is quite an arduous one and involves creating and managing a pool of candidates with high potential and talent to take over leadership roles. Incumbent leaders play an important role in this process and mentor, advise and encourage the identified future leaders or managers on facing various business challenges, tackling crisis scenarios, managing people and generally share their own experiences and gained expertise.
The churn of managers and leaders during the passing of the baton between generations has a direct impact on the employees of an organization. Employees like to see continuity in business practices, organizational ethos and work culture--all of which are defined by top management and business leaders. Only a successful transition of business leaders and managers can ensure proper business continuation, minimize disruption and keep employees motivated to pursue long-term corporate objectives and business goals.
Shareholders, external business partners, board members and other stakeholders are keen observers of an organization’s succession plan and the mechanisms in place to nurture, groom and create new-generation leaders. For these audiences, it is important for an organization’s incumbent business leaders to show the requisite commitment to strategic roadmaps, long-term organizational objectives and ensure a smooth handover of organizational responsibilities to the chosen leaders. Shareholders are especially concerned about continued operational excellence, long-term stability and profitability of an organization.