Your employees are an extremely valuable asset to your organization. Investing time into mentoring, training and giving them stretch assignments to build their leadership skills will pay off for your organization when it comes time to filling upper-level positions down the road.
Your most talented and qualified people might start in an entry-level position. Helping them develop and lead gives you an advantage in retaining them, because it’s not like there’s nowhere else for them to go–everyone is looking for talent. If you don’t recognize and nurture the talent you already have, it will be snatched up by someone else, leaving you with a costly, time-consuming search for someone new.
There are a couple of camps when it comes to who should be on the succession plan: those who identify high-potential employees and focus resources on them and those who assume every employee has potential to move up.
By focusing on just a few employees with high-potential means your organization can devote more time and resources to their mentoring and training. The few select will be better ready to take over when the time comes.
The downside with this approach is that you might fail to recognize potential and actually end up alienating and frustrating your most talented but overlooked employees. If you have a solid hiring practice, anyone you bring on board has potential to learn and lead. Don’t rule anyone out too early.
If your succession plan is to post the job when your current leaders leave, try again. Hiring from within proves to be more successful than bringing in an outside candidate.
A recent study by University of Pennsylvania Wharton School’s Matthew Bidwell shows that outside candidates cost more to hire, are paid more, get lower ratings on performance the first two years on the job, and are more likely to leave than inside candidates. They are 61% more likely to be laid off or fired.
Don’t let your organization get stuck in a position where an internal hire isn’t possible. The time and energy you put into training and mentoring lower level employees will pay off for you in the future.
For a succession plan to be successful, everyone needs to understand the value and support succession planning. If top management doesn’t understand the importance of succession planning, they need to be educated about the value and convinced to actively support the efforts.
Making a business case for succession planning should not be too difficult considering all the advantages:
In some organizations, executives are tasked with identifying and training their own replacements. Leaders not only identify who they see has high potential for filling their role, but also identify growth opportunities for them that include classroom training, on the job training, mentoring and coaching.
Aside from creating excellent leaders, a succession plan where leadership is actively involved with the talent development of lower level employees creates a positive supportive company culture.
Succession planning is important for companies and organizations of all sizes. The goal is longevity and smooth transitions when leaders step out and new ones step in. Promoting from within is the best way to ensure the new leader has the right talents and understands the company culture. Not only will succession planning improve your organization’s chances for survival in a talent war, but it will create a great culture that will help you attract and keep the brightest employees.
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