What is succession planning and why does it matter?

Learn what you can do to ensure talent continuity

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By Nicole Schreiber-Shearer, Future of Work Specialist @ Gloat

March 1, 2022

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Recent years have demonstrated just how quickly things can change. The onset of the COVID-19 pandemic caused operating models to flip upside down, tried-and-true strategies to be redrawn, and organizational priorities to pivot—sometimes overnight.

In the midst of so much disruption, many leaders are asking themselves the same question: what can we do now to set our organization up for success in our next chapter? But as the pace of change continues to accelerate, is it even possible for organizational planning to evolve to stay one step ahead?

The answer is yes, as long as you start prioritizing succession planning now. While no two future of work strategies will look the same, every organization is going to need to ensure talent continuity if they want to secure their status as a leader in the new world of work. So what does it take to turn succession planning into your competitive advantage?

What is succession planning?

Succession planning is the process of identifying the critical positions within your organization and developing action plans to ensure your business will continue to have the talent needed to fill those roles. It’s not about pre-selection, but instead preparation.

Generally, HR teams will take the lead on identifying jobs, skills, and potential competency gaps and designing initiatives to prepare the next generation to step into leadership roles. Succession planning is critical for future-proofing your workforce, as it ensures that your organization will have the right talent in the right places, not just now, but for years to come.

How does succession planning work?

Succession planning starts with creating a clear vision for your company’s future. Leaders need to come together to identify how they see the business progressing, both in the short and long term. Decisions need to be made about which positions are integral to your company’s success and what roles your organization cannot survive without.

Once these high-priority functions are identified, the next step is building a talent pipeline that your business will be able to rely on for the future. In the past, succession planning decisions have often been influenced by external factors, such as personal connections or preconceived notions about what the best fit for a role “should” look like.

However, AI-powered talent marketplaces can take bias out of the equation by identifying employees from across the organization who have the skills and experience needed to step into crucial roles. It’s important to remember that succession planning isn’t a one-time event; it’s an ongoing process. All employees should have access to professional development resources, including both learning curriculums and hands-on experience that gives everyone the chance to put these lessons into practice.

Why is succession planning important?

Succession planning is an essential process if you want to future-proof your workforce and ensure talent continuity. If leaders fail to think strategically about the challenges and business priorities that they are going to face in the future, there’s a real risk that they won’t have employees with the skills needed to support their organization in its next chapter.

Succession planning provides organizations with actionable steps to make sure they have the talent needed to outpace the competition not just now, but for years to come.

What benefits does succession planning offer businesses?

Here are some of the pay-offs associated with top-tier succession planning:

Reduced organizational risk
While some events (like a global pandemic) may be hard to predict, businesses know that their leadership will retire someday. Succession planning gives every organization an opportunity to prepare for change so they can respond quickly and minimize risk.

Cut hiring costs
When there’s no continuity plan in place, talent acquisition teams will most likely need to look outside of the organization to fill critical roles. Finding the right candidate for a high-priority role is challenging, particularly in today’s war for talent, which means your organization will likely need to devote plenty of time and money during your applicant search. In contrast, succession planning enables businesses to grow best-fit candidates from within their organization, minimizing both external hiring fees and the length of time it takes to find a superior applicant.

Boost engagement and morale
If you want to motivate and retain your workforce, you need to show them that their future with your company is bright. Deloitte research found that employees believe it is 2.5 times easier to access opportunities outside of their organization than it is within their company. With succession planning, you can demonstrate that your people have plenty of potential to grow with your business, in turn encouraging them to strive towards achieving their fullest potential.

Increase DEIB efforts
New strategies for succession planning represent a meaningful win for promoting diversity, equity, and inclusion. Decisions about who’s going to fill leadership roles in the future will no longer be dictated by an employee’s personal connections or the names on their resume; instead, an AI-powered approach will identify best-fit candidates from across your organization to democratize access to opportunity.

How do I get started with succession planning?

Succession planning starts by bringing your organization together to create a shared vision for your future. This requires cross-functional collaboration and input from stakeholders who are supporting every function of the business. Rather than relying on traditional succession planning tactics that may have prioritized and uplifted a small subsect of your workforce, organizations can now harness two-sided, AI-powered talent marketplaces to identify the next generation of leaders from across their company.

To learn more about what you can do to empower your workforce to build the competencies they’ll need to lead your business into the future, check out our guide about skills, The ultimate guide to the skills-based organization.

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Succession Planning

Ensure talent continuity

Future-proof your company from impending skill gaps and strategic vacancies with increased visibility, low-latency tracking, and actionable succession plans.

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A company-wide perspective

Successful succession planning and decision making rely on having access to the most relevant data, quickly. Gloat allows for real-time, scalable insights into company structure, resources, and talent allocation, letting you make informed decisions when and where they matter most.

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Recognize gaps before they form

Gloat lets you instantly recognize gaps in capabilities and staffing in light of company strategy, by continually assessing current and future projects, jobs, and talent and skill availability.

Take immediate action

Once Gloat recognizes gaps, you can address them immediately, with the click of a button. Executives and managers can identify emerging needs before they turn into pain points, and your HR leaders can set new recruitment goals and staff new projects and positions quickly and economically. Planning for the future has never been easier.

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FAQ

Succession planning is the process of identifying the critical positions within your organization and developing action plans to ensure your business will continue to have the talent needed to fill those roles. It’s not about pre-
selection, but rather preparation; generally, HR teams will take the lead on identifying jobs, skills, and potential competency gaps and designing
initiatives to prepare the next generation to step into leadership roles. Succession planning is critical for future-proofing your workforce,
as it ensures that your organization will have the right talent in the
right places, not just now, but for years to come.

Succession planning starts with creating a clear vision for your company’s
future. Leaders need to come together to identify how they see the business progressing, both in the short and long term. Decisions need to be made
about which positions are integral for your company’s success and what roles your  organization cannot survive without. Once these high-priority functions
are identified, the next step is building a talent pipeline that your business
will be able to rely on for the future. 
In the past, succession planning decisions have often been influenced by external factors, such as personal connections or preconceived notions about what the best fit for a role “should” look like. However, AI-powered talent marketplaces can
take bias out of the equation by identifying employees from across
the organization who have the skills and experience needed to step
into crucial roles. 
It’s important to remember that succession planning
isn’t a one-time event; it’s an ongoing process. To make the most of it,
all employees should have ongoing access to professional development resources, including both learning curriculums and hands-on experience
that gives everyone the chance to put these lessons into practice. 

Succession planning is an essential process if you want to future-proof your workforce and ensure talent continuity. If leaders fail to think strategically
about the challenges and business priorities that they are going to face
in the future, there’s a real risk that they won’t have employees with the
skills needed to support their organization in its next chapter.
Succession planning provides organizations with actionable steps
that they can take to make sure they have the talent needed to
outpace their competition not just now, but for years to come.

Organizations that prioritize succession planning will reap a variety
of pay-offs, including:
  • Reduced organizational risk:
    COVID-19 served as a powerful reminder that every organization needs to
    be able to adapt to change. While some events (like a global pandemic)
    may be hard to predict, businesses know that their leadership will retire someday. Succession planning gives every organization an opportunity
    to prepare for change so they can respond quickly and minimize risk.
  • Fewer financial resources will be devoted to external hiring:
    When there’s no continuity plan in place, talent acquisition teams will most
    likely need to look outside of the organization to fill critical roles. Finding
    the right candidate for a high-priority role is challenging, particularly in today’s war for talent, which means your organization will likely need to devote plenty of time and money during your applicant search. In contrast, succession planning enables businesses to grow best-fit candidates from within their organization, minimizing both external hiring fees and the length of time it takes to find a superior applicant.
  • Boost employee engagement and morale:
    If you want to motivate and retain your workforce, you need to show
    them that their future with your company is bright. Deloitte research
    found that employees believe it is 2.5 times easier to access opportunities
    outside of their organization than it is within their company. With
    succession planning, you can demonstrate that your people have
    plenty of potential to grow with your business, in turn encouraging
    them to strive towards achieving their fullest potential.
  • Increase DE&I efforts:
    New strategies for succession planning represent a meaningful
    win for promoting diversity, equity, and inclusion. Decisions about
    who’s going to fill leadership roles in the future will no longer be
    dictated by an employee’s personal connections or the names on
    their resume; instead, an AI-powered approach will identify best-fit candidates from across your organization to democratize access
    to opportunity.

Succession planning starts by bringing your organization together to create a shared vision for your future. This requires cross-functional collaboration and input from stakeholders who are supporting every function of the business. Rather than relying on traditional succession planning tactics that may have prioritized and uplifted a small subsect of your workforce, organizations can
now harness two-sided, AI-powered talent marketplaces to
identify the next generation of leaders from across their company
and give everyone the opportunity to build the skills they need to
lead your business into the future.

Investing in potential, the PepsiCo journey

Managing a workforce of hundreds of thousands, PepsiCo’s HR thought leader Allan Church discusses the revolutionary potential of the Talent Marketplace, and looks more deeply into its ramifications for high-potential employees.

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