Succession Planning in HRM by Thamali

 

SUCCESSION PLANNING IN HRM

 

What is Succession Planning?

Succession planning is a business approach that allows firms to transmit leadership responsibilities to another person or group of workers. After key individuals move on to other opportunities, retire, or pass away, succession planning ensures that firms continue to function effectively and without interruption. It can also serve as a liquidity event, allowing rising workers to take over ownership of a business. Companies may use succession planning to ensure that they are fully configured to promote and advance all employees, not just those in management or executive positions.

 

Why succession planning need for an organization?

Ø Ensure business continuity

Ø Develop potential employees

Ø Identify next successor

Ø Smooth functioning

Ø Reduces cost of the organization

Ø Developing career path

Ø Corporate Image

Ø Reduces employee turnover

 

Steps of the succession planning

 

 

Figure 1: Main steps of succession planning

 

Features of Succession planning

 Ø  Systematic Process

Ø  Supply of labours

Ø   Used for higher level organization position

Ø  Internal selection

Ø  Key succession plan

 

Problems faced in implementing Succession planning in an organization

 

Ø  Narrow focus:

Leaders can focus on possible new managers who are already employed by the firm with succession planning, but applicants from outside the company are not allowed. Managers will frequently evaluate just their direct reports as possible successors. This is beneficial to internal employees' career advancement, but it does not always serve the company's best interests. In certain cases, replacing a manager with an external candidate is preferable than bringing fresh capabilities to the team. Other instances, the company just does not have a qualified applicant.

 

Ø  Changes in organizational structure:

 Even if an organization's structure isn't completely stable, succession planning can take place.         Leaders must be developed in order for the company to transform in order to address new business         problems. A person may be trained for a function in the organization that does not exist now but             may in the future. This may have a negative impact on the designated individual's motivation.                 Furthermore, if the employee's training is wasted since the function for which he was prepared no         longer exists, the money spent on his training is lost as well.

 

Ø  Managing HR information

 The issue with maintaining big volumes of HR information may be a difficulty in succession         planning. Because succession planning involves the storage and management of a large amount of         data, it is usually easiest to do it on a computer. Attempting to keep such data by hand might be             difficult. Even on a computer, identifying and evaluating several years' worth of information on an         employee's performance is tough.

 

 

Ø  Crowned prince syndrome

 Another issue with succession planning is when higher management only considers people who     have been visible to them for development. In other words, rather of considering a broader range of        individual employees and their qualities, senior management concentrates solely on one individual         the crowned prince. This individual is often involved in high-profile initiatives, has a powerful and         famous mentor, and has established strong relationships with the organization's leaders.

Employees who are capable and interested in advancement may be missed because of the more     visible and obvious 'crowned prince,' who is likely to be promoted even if these other employees are     available. Furthermore, not only are performance issues a result of this condition, but current                 employees' motivation may suffer as well if they believe their great performance has been missed.

 

Ø  Talent Drain

 One of the issues with succession planning is talent drain. Because senior management selects a select selection of managers for training and development in preparation for promotion. As a result, not every employee may be recognized as a successor. As a result, some employees may feel overlooked, ignored, and undervalued.

As a result, managers who are not allocated to new initiatives may feel unappreciated and, as a result, leave the company. The number of talented managers at the lower and intermediate levels of the hierarchy may be reduced as a result of this turnover. As a result, excellent managers may choose to work for a competitor or establish their own company, increasing competition for their former employer.

 

Ø  Negative effects on motivation

It's not always evident which employee a manager should develop for future leadership roles. There may be two or more strong candidates for the post in some situations. Others may perceive the individual being educated for leadership as favored if leaders do not manage succession plans properly and honestly. This might lead to motivated employees losing interest and not putting up their best effort at work. If there are no opportunities for advancement, it may make those employees believe it is not worth their time.

 

Why is succession planning important in HRM?

The talent management approach requires succession planning. It allows to identify essential jobs, people with the relevant talents, and positions that need to be filled quickly. It also enables organizations to manage recruiting in-house, which reduces recruitment expenditures.

 

Conclusion

Every business has to think about succession.  Organizations' important responsibilities are regularly maintained with skilled individuals due to succession planning, allowing them to preserve their strength.  It is important to identify employees who are committed to the organization's goal and vision when filling crucial positions.

 

References

Anon., n.d. Economics Discussion. [Online]
Available at: https://www.economicsdiscussion.net/human-resource-management/succession-planning/31877
[Accessed 02 May 2022].

Anon., n.d. Investopedia. [Online]
Available at: https://www.investopedia.com/terms/s/succession-planning.asp
[Accessed 02 May 2022].