Imagine a key leader leaving your organization right now. What happens? Do you have a plan to replace them? Is there a process for determining whether you should hire a completely new employee or promote from within? Filling that role quickly and effectively is often a make-or-break moment for organizations. The period before a role is filled can be chaotic and, without a plan in place, it can last far too long and threaten important projects.
That is essentially what succession planning tries to prevent. Through succession planning, you identify the roles that are vital to your organization and figure out the best way to replace them—as well as the impact of replacing them.
In a competitive environment, with labor markets often changing drastically from month to month, succession planning becomes essential for business continuity. It’s not just a nice-to-have.
Key Takeaways:
- Succession planning is a proactive HR process that ensures continuity in leadership and key roles.
- A strong employee succession plan reduces risk, preserves organizational knowledge, and strengthens resilience.
- Organizations should align succession planning with long-term HR planning and business strategy.
- Best practices for how to create a succession plan include identifying critical roles, developing talent pipelines, and integrating performance data.
- HR technology tools, such as HR outcomes dashboards and HRIS connectors, can streamline organizational succession planning.
What is succession planning?
Succession planning is a strategy used to identify vital roles in your organization and the best way to fill them in the event of employee turnover, promotions, or company growth. While general HR planning aims to ensure a company’s workforce matches its growing needs over time, succession planning is much more specific; it’s exclusively limited to certain vital roles and replacing them.
This type of planning makes organizations more resilient, as a single leader’s departure doesn’t throw important projects into chaos. You have a clear plan for how you’ll replace that leader, when they’ll be replaced, and what you’ll do in the meantime. Similarly, succession planning involves properly documenting a leader’s institutional knowledge and building failsafes for their departure, ensuring business continuity.
HR typically leads succession planning efforts, and it’s a large part of their general planning. It aligns naturally with their talent development and employee retention efforts, as it can both identify roles where retention efforts are crucial and craft pathways for existing talent to replace leadership positions.
Succession planning typically focuses on leadership roles or critical specialist roles, since these vacancies can have the most impact on your organization.
Why succession planning matters
Any transition has the potential to disrupt crucial work, team dynamics, and growth. But a sudden vacancy in a critical role nearly guarantees this without a succession plan in place. No proper documentation means leaders take essential knowledge with them when they leave.
No plan for distributing responsibilities or temporarily replacing a critical specialist until the role is filled disrupts performance across the team. Finally, employees start to feel disengaged as elements of their work get more difficult, with no planned end in sight.
Creating a succession plan for your organization’s most critical roles comes with some serious benefits:
- Smoother transitions: Instead of scrambling to replace a leader or a specialist, you’ll have a general idea of what you need to do, how long it’ll take to do, and how to make the transition as close to effortless as possible.
- Retained institutional knowledge: Succession plans typically involve documenting the essential institutional knowledge involved with a role, so it’s not completely lost when someone leaves.
- Higher employee engagement: A key part of succession planning is identifying potential internal candidates for leadership roles. This investment in employee growth helps improve engagement and raise morale.
- Reduced turnover: As you prioritize existing employees as candidates for high-value roles, they feel empowered to pursue loftier goals while receiving support in that growth.
- Strengthening broader HR planning: HR planning aims to fill the organization’s talent needs over time, and succession planning contributes to this by both identifying essential needs and highlighting cases where internal employee development fills those needs.
- Strong business continuity: The uncertainty that comes with someone in a key role leaving can have some serious impacts on productivity, and succession planning can minimize these impacts.
How to create a succession plan
Step 1: Identify critical roles
Not every role needs to be included in your succession plan. Start with leadership and high-skill positions, which are typically the most impactful when vacant. From there, you can use HR data and other performance metrics to identify high-impact roles that don’t fit these categories. Make a list of them, and start your plan from there.
Step 2: Define role requirements
Before you can figure out how you’re going to replace a potential role, you need to know what you’re replacing. Start by identifying the necessary skills, level of experience, and leadership capabilities for that role. There might also be other elements of that role that don’t fit neatly within a typical job description, like leading an all-hands meeting.
Step 3: Assess current talent
The first place you should look for potential successors to an important role is within. First, check a few rungs down the org chart from the specific role you need to plan for, and evaluate their readiness to fill in after a potential departure. Performance management software and HR dashboards can give you a sense of their suitability, or what needs to happen for them to become suitable.
If you struggle to find internal candidates for specific roles, note in your plan that you’ll need a new hire or a consultant to fill them.
Step 4: Develop employees for future roles
When you’ve identified internal candidates for your succession plan, you’ll also have a clear idea of the gap between where they’re at now and where they need to be to fill a specific role. Working backwards, you can identify the skills they need to learn and the characteristics they need to develop. That allows you to pair employees with the right coaching, mentoring, and training opportunities.
When succession planning is a priority, you can make this growth part of an employee’s goals and their performance reviews.
Step 5: Implement and monitor the plan
Once your plan’s been prepared, it’s time to integrate it into broader HR planning. Whenever you review the organization’s talent needs, you can review your succession plan, ensuring your list of critical roles is still up-to-date. You can also use dashboards and HRIS software to regularly review the progress of internal candidates towards the roles you’ve identified them for.
Finally, you’ll want to review your plan as the organization grows and changes. Maybe once-critical roles become less important as teams get larger. Or a new department starts becoming essential to day-to-day operations.
Common challenges and how to overcome them
Succession planning is an essential part of talent management, but it’s not a one-and-done process. It’s also not always simple. Here are some of the challenges you’ll encounter building and carrying out your plan.
Challenge 1: Resistance to change
Change can be inherently stressful, even in a professional setting. The mere mention of a leader or essential specialist leaving can create discomfort, making it difficult to plan for that departure properly. Similarly, employees may initially be resistant to your plan to train them for a specific role.
Challenge 2: Limited resources
You won’t always have the resources you need to identify, train, and support internal candidates for critical roles. This might force you to prioritize roles that would cause the most disruption without a succession plan, or to focus on new hires and contractors when you would otherwise invest in developing existing employees.
Challenge 3: Talent gaps
Multiple factors can combine to make your organization lighter on the kind of talent you need, making it difficult to properly plan a succession. This might force you to plan for a longer investment in a specific employee to plug talent gaps, or build a stronger talent pipeline through other HR planning initiatives.
Challenge 4: Lack of measurement
Many HR teams struggle to measure the impacts of their planning efforts, either because they don’t have the right tools or their processes don’t involve relying on these tools. Both HRIS platforms and performance management tools can give you the tools you need to track the progress employees are making towards specific roles in your succession plan.
Tools and technology in succession planning
Like many other HR processes, using the right technology can streamline your succession planning, allow you to track progress towards filling critical roles, and even measure the impact of these critical roles.
HRIS connectors
Your HRIS is the home base for the employee data you need for a variety of HR processes. But these tools rarely have built-in performance dashboards or tracking systems that actually help you identify and support employees being trained up for succession, or find gaps you might need to hire for.
That’s where HRIS connectors come in. These software integrations allow you to connect your HRIS to platforms that turn that employee information into metrics. For example, 15Five’s HRIS Connector feeds dashboards, performance reviews, and other tools you need for your succession planning.
HR outcomes dashboard
15Five’s Outcomes Dashboard gives HR leaders everything they need to do more with people data, plan stronger HR initiatives, and track the impact of those initiatives. This dashboard allows HR leaders to:
- Assign action plans to department heads and managers, such as identifying critical roles.
- Visualize organizational trends to identify potential talent gaps.
- Track trends in employee engagement, performance, and retention.
Integrating succession planning with broader HR tech stack
Succession planning has an impact on other essential HR processes, from performance management to employee development. That means any tools you use to build, improve, and track your plan need to account for these other processes. That’s why many HR teams use software integrations to connect the tool used for succession planning with their broader tech stack.
15Five, for example, connects with HRIS platforms, chat apps, and more.
Best practices for effective succession planning
Ready to start your succession planning efforts? Here are some best practices to keep in mind.
Start early
Many HR teams start to think about succession planning when an important leader or specialist leaves, and they realize they don’t have a plan to replace them. That’s why you should consider succession planning early and integrate it into your broader HR planning strategy.
Prioritize transparency and communication
Employees should have a clear idea of how you plan to replace critical leaders and specialists; that way, they know what to expect as they go through periods of change. That means clearly communicating your plan to fill potential vacancies, early enough that everyone knows what’s coming next.
Plan across hierarchy levels
Too many succession plans focus primarily on leadership roles, but various specialist roles benefit from succession planning, as well. The key is to properly filter for essential roles without spreading your attention too broadly.
Review your plan
Your succession plan isn’t one-and-done. It needs to adapt to your organization’s growth, its evolving needs, and the changes in your talent pool. You can review this plan quarterly or during specific periods of organizational change.
Use qualitative insights and data
Data gives you metrics to track how employees progress towards the skills they need to replace potential departures, as well as helping you define critical roles. But qualitative insights, derived from feedback surveys and interviews, can help define critical roles and performance goals for internal candidates.
Better planning, better succession
Succession planning ensures that vital roles in your organization don’t stay empty for long, while guaranteeing a smoother transition until that role is filled. This type of planning isn’t just a vital part of broader talent management and HR planning; it’s also essential for building resilience in your organization. That way, a single leader leaving won’t throw your operations into disarray.
With this plan, it’s important to be transparent, evaluate internal candidates against new hires, use data to measure your plan’s success, and review it over time.
Want to see how a performance management platform can help with succession planning? Book a 15Five demo.
