Businesses can’t run effectively without the flexibility and leadership to place talented individuals into key positions as people transition in and out of the company. Before COVID-19 came in and changed life as we know it, HR experts had predicted we would see major C-suite transitions as part of 2020 trends. Having a succession plan in place is one of the key factors to ensure your company’s longevity and security. The financial and economic impact of COVID-19 combined with the public outcry for racial justice cemented the importance of a succession plan for diverse companies in order to protect key roles by preparing potential candidates for the next step in their careers.
What Is a Succession Plan?
A succession plan is a crucial way to help your organization navigate leadership transitions in the event of an unexpected event without a major impact to the business. The succession planning process consists of evaluating each individual leader’s skill set and then identifying which potential replacements exist both internally and externally. Once potential candidates are identified you begin training those employees so that they are prepared to take over when needed. This is not a singular event or occurrence, succession plans are usually revisited annually and updated to meet the needs of the company.
How Business Succession Supports Diversity
Having diverse leadership is more crucial than ever as executive teams from varied backgrounds bring a variety of talent that can be an advantage to the business. A succession planning best practice is to develop a strategy that provides your company with an array of diverse talent and that begins by identifying the inclusivity of your organization. Does your organization currently have diversity amongst all teams? How culturally diverse is your organization? These are just a few questions to consider as you are creating a succession plan that examines potential successors and candidates for executive roles. The value of diverse teams in today’s market outperforms non-diverse teams by 35% because they are more creative, innovative, and inclusive about their solutions in every phase of business. Currently, only 33% of employees in succession pipelines are minorities and this limits the potential success of a business as leaders transition out of their roles.
Succession Planning Steps
Succession planning provides an enormous benefit to companies who are looking towards the future and seeking to develop the leadership skills of employees at all levels of the company. Sometimes the most unexpected candidates can rise to the occasion and become empowered to represent your business at the highest level.
Here are few critical components to consider as you develop a succession plan for your company:
- Review your hiring practices with the intent to choose candidates that have long-term potential for growth and leadership.
- Implement training that goes beyond the standard HR sexual harassment modules. Invest in developing employees’ skills by having them cross-train and shadow executives so they are well rounded.
- Include your HR leadership at the executive table to ensure there is a combination of a data-driven and people-centric approach to identifying talent.
Are you ready to start your succession planning process? Let us know in the comments below!