Succession planning involves preparing for the departure of key personnel, typically those in leadership roles, such as senior management, and most commonly those in the top executive spot such as the chief executive officer (CEO), chief financial officer (CFO), president or executive director. For brevity, the term “CEO” will be used throughout the article, but it should be understood to represent any critical role in an organisation.
The purpose of succession planning
The purpose of succession planning is to ensure continuity of the organisation’s performance and often its very survival. Succession planning is done to ensure that if key people leave, the organisation can continue to fulfil its goals and carry out day-to-day operations with minimal disruption. Succession planning helps to facilitate a smooth leadership transition.
The succession planning process involves identifying critical roles within the organisation (such as the CEO) and the major responsibilities fulfilled by these roles (for example, interfacing with the public, decision-making, supervision, ethics, steward of the organisational vision and values, and so on).
It involves identifying people already in the organisation who can potentially fill these roles, and preparing them to step into the vacant role, either temporarily or permanently. It may also involve setting out a recruitment process and describing desirable candidate qualities.
A good succession planning process should take into account the strategic vision and objectives of the organisation and identify how they will live on if key people depart. The succession plan should reinforce the organisation’s goals and objectives and be aligned with the overall business strategy.
Succession planning is a necessary feature of healthy and effective for-profit or not-for-profit organisations. Leadership transition is a pivotal point in the life of an organisation and can sometimes make or break it.
It is strategically important to plan ahead for leadership departures because it often takes an unanticipated amount of time to find and establish a new person to take on such an important role. When succession planning has not occurred, or has not been conducted effectively, some of the more detrimental results can include:
• Disruptions in services, production or productivity;
• Stalled critical projects;
• Decreased employee morale;
• Unclear organisational direction;
• Loss of critical knowledge; and
• Competing interests or ideas stalling the replacement process and putting further strain on the organisation.
The failure to have a succession plan can be detrimental to the bottom line. In for-profit organisations, it can mean lost profits, and in not-for-profit organisations, it can mean decreased funding and programme cuts.
The lack of foresight and planning can also be detrimental to the incoming leader’s success, placing the organisation in a cycle of displaced leadership that can be difficult to rebound from. Ultimately, an organisation’s goals are difficult to fulfil without an appropriate succession plan.
Tomorrow: Types of succession plans
Article by Dr Jessica Sartori, a change management consultant in Windsor-Essex, Ontario, Canada. She consults with for-profit and not-for-profit organisations and leaders, and is the president of Organization & Leadership Development, Windsor-Essex. Visit http://www.sartori.ca for change management resources. Article source: http://EzineArticles.com/?expert=Dr._Jessica_Sartori