An article that I found recently has reinforced the position that I have taken regarding the need for succession planning or succession development as I prefer to call it. This article confirms the need for all organizations, big or small to begin the succession planning/succession development process.

Business Need

In most cases, succession planning/development focus on three main areas. First, it addresses the needs of the organization as senior management ages. Too often, the enterprise neglects succession planning/development and does not have people available who are fully prepared to assume the top posts. Although large organizations are at risk, the problem can prove especially severe at small companies, which often flounder, and sometimes collapse, after the founder or CEO leaves. At many businesses, having little or no succession planning/development wreaks havoc when the organization's leader retires.

Second, succession planning/development help an organization to prepare for an unexpected event. It is often difficult to plan for the unimaginable. Although it is not feasible to plan for every possible scenario and particularly for the loss of several key leaders at the same time, it is entirely realistic to map out a chain of command and understand who will assume control if and when a key executive is lost. Recent world events illustrate how important succession planning/development is. When the World Trade Center attacks took place, dozens of companies lost key executives, including CEOs and CFOs, who were on the planes or in the buildings that were destroyed.

Finally, succession planning/development ensure that an organization has the right personnel to function at peak efficiency. Today, many organizations strive to identify key objectives and business goals and shape a work-force accordingly. Not only does succession planning/development serve as a way to create an organizational hierarchy, but it can also help organizations conduct an inventory of human capital and better understand gaps. It can also help organizations manage change in a more holistic way.

Many CEOs and senior management teams fail to develop in their successors the high-level skills and competencies they will require. Too often, leaders are too absorbed in day-to-day issues, overly focused on short-term results or unable to adapt to change.

Another problem is that even the best training program cannot always supply the talent needed to run an organization at peak efficiency. This is particularly common at companies that are growing rapidly. Sometimes, it is essential to find talent from the outside. But this, too, can pose a formidable challenge with the recruiting process and the time to properly train the successor. Most companies can ill afford to take a year to replace key personnel and the skills they offer.

Strategically Focused

Although successful organizations usually focus on training to develop leadership from within the executive circle, they also understand that it is sometimes wise to look outside for particular skills and knowledge. Of course, the more prominent a position within an organization, the tougher it is to find a suitable candidate. Thus, some turn to outside consultants to manage recruiting and, sometimes, the entire succession planning/development process. Consultants can provide objectivity and help develop a strategic plan that encompasses all levels of the enterprise.

In fact, organizations both large and small are increasingly looking to outside expertise to bolster their capabilities. Consultants can provide specific expertise that matches an organization's requirements. By assessing best-in-class candidates and understanding an organization's existing internal talent pool and needs, it is possible to identify specific skills, competencies, and candidates from within and across industries ranging from medicine to financial services, semiconductor manufacturing to freight shipping such as ltl freight.

Ultimately, this allows the enterprise to focus on its core business while the partner analyzes organizational needs. A consultant or outsourcing provider can track wages and ensure that its client is paying appropriate compensation and benefits to attract and retain top-notch talent. It can also ensure that hiring takes place at the right time. For example, if an organization knows that the CFO will retire within the next year, it can hire a highly qualified candidate well in advance and seamlessly integrate him or her into the company. Without such planning and coordination, the new executive might not be willing to make the leap to a new company.

Framework

There is no simple template for putting a succession planning/development process in place. Every organization is different, and each organization must develop a succession plan that fits its specific needs. Management must guide this process and the human resources department must oversee it. And both must focus heavily on organizational culture-what exists and what is required in order to succeed. Effective succession planning/development also demands assessment systems that can measure the development of skills, competencies, and knowledge within the enterprise.

Summary

Succession planning/development is a complex task that requires constant attention and ongoing resources. Successful organizations devote considerable time and resources to mapping out skills and competencies so that they can hire and train appropriately and achieve a distinct competitive edge. Best-practice organizations also prepare for unforeseen events and the potential loss of key executives. Finally, these organizations view succession planning/development as an ongoing process rather than an event that must be addressed every year or two.

A growing number of companies are recognizing the value of succession planning/development, and they are expanding the concept from one traditionally used to manage only senior level positions to encompass managerial positions across the organization. They are also taking succession planning/development beyond organizational charts and using it as a comprehensive change-management tool that helps the organization identify gaps in talent and fill them more effectively. Ultimately, a comprehensive succession-planning strategy helps businesses leverage the full value of human capital.