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3 Questions to Ask During Your Succession Planning Process

Sep 29, 2022| Reading time: 10min

BY Kate Super

Content Writer

You receive notice that your CFO is unexpectedly leaving, effective today. The timing couldn’t be worse – your VP of Finance is set to retire next week. And then reality hits: no one else in the department understands the responsibilities, processes, and accounts associated with these roles.

Unfortunately, this isn’t a fabricated scenario. And situations like this happen all the time, especially after acquisitions (when the organizational structure isn’t redesigned) or in fast-scaling companies (which may focus more on day-to-day tasks instead of strategy).

You therefore need to invest time and resources in succession planning to help mitigate risks like these down the line. To ensure your team is aligned on decisions and strategy, ask the following three questions as a part of your succession planning process.

1. What Are Our Company Goals?

For a successful succession planning process, you need to consider your company’s goals. And by goals, we don’t mean quarterly OKRs or your long-term vision statement. Instead, focus on setting goals for the next one to five years and determine the people needed to make them happen.

That last task – considering your people and their skills – is the bread and butter of your succession planning process. You’ll quickly learn that you can’t achieve specific targets if you don’t have the right people. For example, a goal of increasing your marketing team by 50% doesn’t make sense if you don’t have plans to hire a recruiter. Similarly, you wouldn’t aim for a technology product release in the next year if your head engineer was planning to retire. 

Therefore, when deciding if your company goals match your current workforce, consider:

  • Do we know of any key stakeholders or leaders that are planning to retire in the next five years? 
  • How is our employee experience helping retain our top performers? 
  • Are there any critical positions that we can’t afford to have a long time-to-fill?
  • How much would it cost to hire externally versus promote internally? 
  • Which goals are “nice-to-dos” versus “must-dos” to keep our organization healthy?

Ultimately, aligning your succession planning strategies to company goals helps create an action plan for your organization and people. This action plan doesn’t just benefit your company by reducing risks; it also benefits employees by encouraging upward and lateral growth.

2. How Do We Identify the Right Internal Candidates?

Imagine you had to leave your company right now and choose your successor. Who would it be? If a flurry of your projects, clients, and responsibilities flashed through your head, you’re not alone. Everyone wants to ensure the right person is taking over their role, AKA someone who is skilled as well as motivated, trustworthy, and competent.

Therefore, the evaluation phase of the succession planning process is an important one.

When it comes to choosing the right candidate, you’ll find two different approaches for internal succession: choosing by person and choosing by qualifications.

Choosing the Right Person for the Role

Your first option for choosing the right candidate is selecting certain people within your organization. It’s a popular succession planning strategy, especially when it comes to backfilling executive roles. 

Management consultant Peter Cohan advises leaders to choose “a successor with a track record of entrepreneurial success.” And if you’re looking to “future-proof” your company, as he calls it, look to select two people – “one who has created new revenue streams and another who excels at controlling operations.” 

There’s additional benefits to choosing specific people, such as your ability to:

  • Target specific professional development. While you should always encourage consistent professional development among your people, identifying specific successors allows you to target their skill gaps so they’ll be prepared for their new role.
  • Identify people with proven leadership skills. It can be hard to find candidates who possess all the personality and leadership traits you’re seeking. When you choose specific people as potential successors, you can identify social competencies – such as building productive relationships and managing change – that wouldn’t normally come across on paper. 
  • Retain top talent. Over 30% of people leave their organization due to lack of career advancement. When you choose specific people to become successors, you help ensure their engagement and employment at your company. 

Choosing the Right Position for the Role

The second succession planning strategy is looking to qualifications, not specific people, when identifying candidates. The National Institutes of Health advises that organizations should leverage positions, not people: “It is more effective and a best practice to determine which positions are best qualified to succeed another position rather than the individual people filling those positions at any given time.”

By finding competent candidates via their position, you can help:

  • Provide equal opportunities. If you’re a company that prides itself on transparency and inclusiveness, looking for qualified candidates via position promotes organizational justice and helps reduce promotion bias. 
  • Identify introverted leaders. A healthy organization needs a mix of personalities, but unfortunately, introverts are often passed up for leadership roles. That’s a shame, since people with introverted personalities possess strong leadership traits. Therefore, choosing candidates by role helps elevate quieter colleagues who may have been originally overlooked.
  • Reduce attrition risk. We all know the saying of putting all your eggs in one basket. When you count on a person, not a position, to fill a role, you’re assuming they’ll stay on with your company. Since the average person switches jobs every four years, it’s safer to create a succession plan that focuses on skills, not a specific person.

Employee profiles in ChartHop

When your employee profiles also include job descriptions, you (and they) can better understand the responsibilities and skills needed to be successful.

3. Where Does Our Company’s Knowledge Live?

When someone leaves the company – intentionally or unexpectedly – critical company knowledge may also be walking out the door. 

If you don’t have a succession plan in place, the best-case scenario is that you lose significant time getting your people up to speed. The worst-case scenario? You never recover those lost insights.  

It’s therefore necessary to consider where your company’s knowledge lives. To keep your employees aligned and your data secure, avoid saving important documents on spreadsheets or saving on hard drives. Instead, store your company knowledge in a centralized location, like a people analytics platform or a shared drive, so the right people always have up-to-date information at their fingertips.

For example, let’s say you’ve named Lisa as the new VP of People. She needs to understand the growth of the company over the past six years so she can make data-based decisions moving forward. Luckily, your company’s information isn’t buried among different drafts on her predecessor’s desktop. Since you’ve invested in a people analytics platform, she can quickly visualize the people data she needs, which results in less time asking for help and more time gaining insights. 

time travel function within platform

If you want to quickly visualize the progress you’ve made, look no further than an org chart with time travel capabilities. With it, you can quickly identify the growth of your company and teams.

Make You Sure Have a Solid Succession Plan in Place

If you haven’t started creating a succession plan, take this as your sign to set up a meeting with your executive team. If you already have one, it’s time to review it with the above three questions in mind. 

When you consider your company’s goals, the right successors, and the way you store company knowledge, you set the stage for a stronger succession plan to help your team navigate the predictable (or unpredictable) situations that you will undoubtedly face. 

Even though you can’t predict the future, you can still prepare for anything that may disrupt your organization. With ChartHop Scenarios, you can use your people data to plan in a visual format that’s easily accessible to your teammates.  

Watch the capabilities of scenarios here

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