Many small businesses do not think much about succession planning. They tend to postpone this critical element of business continuation because they are focused on the here and now instead of the future.
What is succession planning? Succession planning is a process that strategically aligns the needs of the business with human capital; therefore, it is never too early to create a succession plan. When properly executed, a succession plan ensures the right highly qualified and capable people are in position to achieve operational and cultural continuity.
Many companies put a succession plan in place for reasons other than key people retiring. For example, the plan can position the organization for unexpected changes and support strategic and operational growth objectives.
When succession planning, here are five mistakes to avoid:
1. The Plan is Not a Plan – taking succession planning too lightly.
For many organizations, their plans are not formalized with a structure in place. Instead, they tend to be loose—more of an idea or a general direction. Make sure your plan is formal with well-thought-out strategies, objectives, actions, and timelines.
2. Late to Create – not addressing succession needs soon enough.
Succession planning is constantly on the minds of exceptional leaders because they think proactively about the future. Preparing the next generation of leaders takes time, as does knowledge transfer. Make sure your plan addresses these and goes as deep into the organization as is practical.
3. “What We Have is What We Need” Mindset – planning for the type of personnel you have today versus the type you’ll need in the future.
Exceptional leaders know business needs shift over time. As those needs change, the capabilities of future leaders must align with them. Make sure you take the emotion out of the plan creation and have the foresight to craft what you will need, not simply replace what you have.
4. An Ineffective Development Plan – missing key opportunities to develop future leaders.
Be sure to identify specific needs for improvement and provide future leaders with proper training, coaching, or mentoring for each one’s development. This often begins with assessments to ensure the training and development is targeted for each individual, then determining if they’re effective. Does the training and development process succeed in transforming those leaders to fit into the roles you will need?
5. Not Measuring the Plan’s Progress – failing to measure carefully.
Like a construction project, success with plan execution requires regularly measuring progress and making adjustments to the plan as appropriate. Make sure you build check-in points and milestones into your plan. You want to avoid reaching the day of your retirement, only to conclude that the leader replacing you isn’t ready.
Many organizations do a great job with succession planning, but when they don’t, it can:
- negatively affect productivity
- damage morale
- cause unwanted turnover
- create voids throughout the organization
Life often comes at you fast. That’s why you want to get prepared by doing succession planning now. And if that process is uncomfortable to deal with, get outside expertise—it’s that important.
