Succession planning is a crucial part of long-term stability of any organization. Succession planning can be defined as finding and grooming potential employees for higher positions such as senior management, CEO, COO or even for the director board. it ensures that businesses continue to run smoothly even after a company's most important people move out of the firm, retire, or deceased.(Kenton,2020)
Importance of succession plan
Succession planning is very important part to any organization. As future of the organization is depend on company addressing proper Successors to take over the organization. Even in accounting we have leant “going concern concept”. A core part of the said concept is consists with that the company continues its business for the foreseeable future. In order to continue the business for foreseeable future organization needs financial assets as well as human assets (Human resource) .Stake holders, mainly investors are more concern about organizations succession plan. As their investment’s future is on the hand of potential leaders of the organization . Having a proper succession is beneficial for both organization as well as for the employees. When employees know that they have a future or rather potential to become a future leader of the company, their loyalty and dedication towards achieving company’s goals will automatically goes up. (Hirsh, 2000)
The Role of HR in succession planning
In nature senior managers do not prioritize succession planning as their major task. they do not voluntarily commit their time to succession planning, As their main priories are to perform as best as possible during their tenor (Mostly achieving quantitative targets. Such as profit maximization, Increasing market share). Hence HR should act as a facilitating function to help them to plan future successors. The HR should support and act as an impartial adviser to make sure the process happens. Further proving independent evaluation and reporting process is HRM Even although senior managers or BOD identifies successors, some candidates may not have the required skills, succession planning also often includes training and mentoring for potential candidates which is also a major task of HRM. (Day, 2007)
The Succession Management Process
Source: (Day, 2007)
And more importantly employee’s awareness about companies’ expectations as a successor is also very important. As once Elon musk said “people work better when they know what the goal is and why, it’s important that people look forward to coming to work in the morning and enjoy working" also HRM department should not limit their task of Implementing succession just for the sake of internal auditors to tick the box: succession plan in place.
References
Kenton W 2020. Understanding Succession Planning ( Online )
Investopedia Available at https://www.investopedia.com/terms/s/succession-planning.asp
[ Accessed 21 July 2021 ]
Hirsh, W., 2000. Succession planning Demystified.
[online] Employment-studies.co.uk. Available at: < https://www.employment-studies.co.uk/system/files/resources/files/372.pdf
> [Accessed 21 July 2021
Day, D., 2021. Development Leadership Talent. [Online]
Shrm.org Available at: < https://www.shrm.org/hr-today/trends-and-forecasting/special-reports-and-expert-views/Documents/Developing-Leadership-Talent.pdf
> [Accessed 21 July 2021
You have simply explained how succession planning involves HRM and the importance of succession plan. I noted that there is two types of succession plans, contingency plans and Long-term plans. In current world with this unforeseen pandemic situation and global and industrial changes, it's more important to having a contingency plan for the organization.
ReplyDeleteGreat work with attractive topic!
Thank you so much Umesh
DeleteA simple but detailed description Tharindu. Clearly explained that HR is no use without a succession planing. From both the theories in this context, organisations must implement them to enhance the awareness of the employees in order to achieve the objectives as you discussed.
ReplyDeleteThank you so much for your valuable comment Gangani
DeleteHi ! Tharindu. You simply explained the importance of organizing the succession .Most of time the ultimate goal of the organizations is " Reach the targets" .It is very important to know the employees what is their goal. By having a organized succession , Employees got to know their future, It will helps to increase the employees loyalty and the dedication toward the organization.
ReplyDeleteIndeed Parami . Thank you so much for your valuable comment
DeleteHi Tharindu,
ReplyDeleteI agree with you. The succession planning is very important to the organization, coz it helps to further strengthen the organizational stability.
Thank you so much for your valuble comment Heamaka
DeleteDear Tharindu
ReplyDeleteSuccession planning is a motivate factor for staff also. As you said when people feel that their future safe it is a beat motivation factor that people can have. Therefore HR people should actively participate to succession planing
Exactly ! Thank you so much for your valuable comment Sunith
DeleteSuccession planning is a strategy for passing on leadership roles. It is an important part of the talent management process. It provides a way to identify key roles, people with the right skills and positions that may need filling in a short space of time. It also provides a way to cut the costs of recruitment, enabling organizations to manage recruitment in-house.
ReplyDeleteVery well said Oshadha . Thank you so much for your valuable comment
DeleteThank you for sharing this Tharindu and neatly explained.
ReplyDeleteSuccession planning is one of the important but ignored part of most organizations currently. I agree with you that HR should facilitate and practice succession planning actively at each level of organizations which will make the good companies to do better.
Thank you so much Fayaz for your valuable comment
DeleteWell written Tharindu. In terms of succession management, high potential employees have both strong technical skills as well as the potential to develop a strong leadership competence. HRM must come up with personalised and tailored employee development plans to make it success. Thankyou for sharing Tharindu.
ReplyDeleteExactly ! Thank you so much for your valuable comment Rukmali
ReplyDeleteAgreed Tharindu, a succession of persons to fill key positions over time is essential for the survival and success of an organisation
ReplyDeleteThank you so much for your valuable comment
DeleteThank you for the valuable article. It clearly mentions that organizations are useless without a succession strategy plan. . Making a successful plan is difficult. It's harder to succeed. HR's main duty is to assist with the overall success of the plan.
ReplyDeleteThank you so much for your valuable comment
DeleteGood job Tharindu. Succession Planning is the process of identifying and tracking high-potential employees who will be able to fill top management positions when there is a vacant. Succession planning is an ongoing process that identifies necessary competencies, then works to develop, and retain a talent pool of employees, in order to ensure a continuity of leadership for all critical positions. Succession planning is a specific strategy, which spells out the particular steps to be followed to achieve mission, goals, and initiatives identified in workforce planning. Thanks for sharing.
ReplyDeleteVery true Harsha. Thank you so much for your valuable comment
DeleteThis is great Tharindu,as you mentioned here, succession plan is a plan that focuses on identifying and developing employees in order to help them advance within an organization. Succession planning is important because, as an organization grows, it’s more cost effective to develop current employees for key positions rather than hire new people. Giving employees a clear path forward in their careers via a succession plan can also boost engagement and retention. Thanks for sharing
ReplyDeleteYes Mihirani , Thank you so much for your valuable comment
DeleteYou have simply explained the importance of succession plan and role of the HR in succession planning.This is an important process for both employer and employee.Every organization need to have a succession plan together with their growth plan.Having a growth plan without a succession plan is like building a skyscraper and forgetting to add the elevator.
ReplyDelete