Did you know that less than half of all Americans have a will or have made estate plans? We all know that our time will come at some point, but we still put off what we know is important. Our heirs, family, and friends will be better off with us having created a plan once we are no longer around.
I imagine comprehensive succession planning occurs less frequently than estate planning. This HBR article shares that business succession planning is relatively rare. However, we understand that all employees will move on from the organization at some point in the future. We need to recognize that as our organization evolve, our staffing needs change. Organizations can ensure smooth transitions, development of employees, and better hiring decisions when succession planning effectively occurs. We often avoid succession discussions or do not have time for succession planning, but our organizations could benefit from these conversations and planning.
We need to think about short- and long-term succession planning:
Short-term succession planning: This type of planning helps organizations in situations when an executive or key employee leaves suddenly or is unable to work for a period of time. Here are some ways organizations can be ready for the short term:
- Identify essential job functions that need to be covered immediately and develop a backup plan for these functions.
- Update all job descriptions at least annually and list key tasks that occur throughout the year. More detail will help during successions.
- Document key contacts and work processes in a way that can be understood by others. Review these processes with management.
- Develop a system to collect and organize logins and passwords for various functions.
- Discuss how short-term succession will be communicated to employees, boards, and customers.
Long-term succession planning: This type of planning helps organizations ensure long term success. Here are some ways organizations can be ready for the long term:
- Develop a long term or ideal organizational structure or chart. Future job descriptions are also helpful. This information should inform future hires and how current employees are developed.
- Create an employee development program that will prepare current employees for future roles in the organization.
- Hire new employees with thoughts about their potential for immediate and future leadership roles.
- Discuss with employees their career aspirations at least annually. Ask employees how the company can help their development. Leaders can encourage employees to consider pursuing new roles that meet their skill sets.
- Identify areas of need within the organization and determine if the right person just needs some additional training or education.
We work with organizations on leadership development and find that many organizations and employees fail to have succession discussions or conduct succession planning. We can help you facilitate discussions and develop plans for employee development and succession. This planning will help your organization in the short and long term.
There are other conversations that may need to take place based on the type of organization. For example, family businesses may need to have discussions among family members about who will take over key roles in the business. There also might be discussions about buying and selling the business. Due to the sensitive nature of these topics among family, it can be especially helpful for family businesses to bring in an outside resource to facilitate these discussions.
Comprehensive succession planning takes years to accomplish. This article is not meant to be an exhaustive guide for succession, but we hope it gives you some things to think about and discuss. If you other items to consider for succession planning, we would like to hear from you.