The absence of a succession plan can seriously hamper the growth prospects of an organisation. Imagine the disastrous consequences when there is a sudden vacuum at the top level. There is no one to steer the ship. Critical plans needing immediate action get postponed. The organisation remains headless and directionless for a while. Suitable candidates may not
be available internally, as no one has been groomed in the past, keeping such an eventuality in mind. Bringing in outsiders may mitigate the crisis temporarily but the long-term impact is bound to be negative. Internal forces may start a rebellion and create tug-of-war situations with frustrating regularity.
Succession planning is: “The process of ensuring a suitable supply of successors for current and future senior or key jobs arising from business strategy, so that the careers of individuals can be planned and managed to optimize the organisations’ needs and the individuals’ aspirations.”
The purpose of succession planning is to identify and develop people to replace current jobholders in key positions. Through succession planning, companies assure a steady flow of internal talent to fill important vacancies. Succession planning encourages hiring from within and creates a healthy environment where employees have careers and not merely jobs. It helps in identifying human resource shortages and skill shortages before openings occur. Thereafter, it becomes easy to groom qualified candidates for future vacancies. The organisation is thus assured of continuity of operations and better-qualified incumbents.
Preparing a schedule for succession is critical to the success of a company, especially at the top level. When the baton changes over a period of time, disruption and dislocation are minimised. Indeed, when a new CEO is meant to consolidate on past successes, a slow shift is ideal. If qualified candidates are not available within the company, outsiders can be considered readily for possible openings. Complete dependence on succession from within or from outside is not desirable. Internal candidates require a ‘pat on the back’ when they do well. External candidates are needed for injecting flesh blood into the company.
A succession plan is a plan for identifying who is currently in post and who is available and qualified to take over in the event of retirement, voluntary retirement, dismissal or sickness. A typical succession chart shows details of key executives and brief references to their possible successors.
The replacement chart is a visual representation of who will replace whom if there is a job opening. Table shows the various jobs in the finance department and reveals the status of likely candidates who could be considered on the basis of performance and the opinions by immediate superiors of future success in a new job. The replacement summary indicates likely replacements for each job and shows their relative strengths and weaknesses. This can be prepared in a detailed way so as to facilitate the easy selection of a candidate in case of future vacancies.
The terms ‘career planning’ and ‘succession planning’ are not synonymous, but they are similar. Succession planning is generally needed for key positions at higher levels, while career planning covers executives at all levels including high skilled employees and operatives. Career planning, by its very nature, includes succession planning. The career paths for executives are identified. How people can grow vertically is also indicated. In case of a vacancy arising at any level, the career plan is well supported by a succession chart. Both are thus complementary and interdependent.