What is ‘succession planning’?
Succession planning is a term used to describe a roadmap to identify and develop talent within an organization for the purpose of ensuring internal employees are prepared to assume key roles when existing employees depart. In recent years, many large companies have integrated succession planning into their ongoing organizational strategy, recognizing the multi-faceted benefits to the business.
Why succession planning is important
There are a number of reasons why succession planning is critical to every business endeavor. In 2015, only 18% of the baby boomer generation had reached retirement age. The boomers make up 27% of the population, and it is estimated that up to half a million Canadians will reach retirement age each year. Despite a rise in Canadians staying in the workforce past the age of 65, more employees will still be leaving the workforce each year than will be entering it. In addition, according to Statistics Canada in May 2016, the median employment tenure of Canadians in the business sector was approximately 6 years. With the knowledge that turnover and employee departures are inevitable, succession planning is essential to protect organizations from losing valuable time and money searching for and training replacements. In addition, the loss of knowledge and experience is often impossible to recover. Therefore, if your organization has not yet adopted succession planning into its system, the time is now!
How to establish a succession planning strategy
Companies that adopt “emergency” replacement planning as a means to mitigate turnover pitfalls are losing sight of the longer-term business needs. Replacement planning is a short-term solution for unexpected employee departures to cover job tasks until a more permanent replacement is found. There is definitely a place for this strategy, however, long-term vision and investment in organizational continuity is a necessity. Succession planning is an investment in the business and its employees. Invest in your employees, and they will invest in the organization. Through strategic talent identification and management, turnover can be reduced, and knowledge retained. Through the incorporation of mentorship, knowledge sharing, and training initiatives, the risk of valuable knowledge exodus can be mitigated. An overview of the steps involved in creating an effective succession plan is below.
8 Steps to Effective Succession Planning – Chart
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Melissa has been an organizational leader for over 15 years in various industries. She holds a Bachelor of Arts degree and recently completed a Master of Arts degree in Leadership. She currently works as an organizational leadership consultant at Fox & Owl Consulting Services.