Succession planning is an important aspect of companies being prepared for the future.
With the increase in workers leaving companies to pursue other ventures or interests, it's no surprise that more and more employers are making succession planning a vital component of their recruitment and retention process. The upheaval in the labor market has underscored the importance of having a plan in place to ensure business continuity when staff depart.
For its report, Succession Planning: Preparing Organizations for the Future, the Association for Talent Development surveyed 243 organizations and learned that half had a succession planning process in place. Of those that did not, 60 percent plan to implement one. Both are an increase from ATD's 2018 survey.
The report also found that organizations with fewer than 1,000 employees were less likely to have a succession plan than larger companies. When ATD asked employers whether their succession planning efforts have changed in the past two years, 69 percent said they have increased, while 27 percent said they had made no change.
Barriers to having a succession planning process include lack of resources, lack of succession planning knowledge or skills among staff, and lack of support from senior leadership.
The critical component of any succession plan is measuring its success. However, according to the report, only 28 percent of respondents measured the effectiveness of their succession planning with internal candidates. Those organizations were significantly more likely to be high performing.
The measures used to evaluate the success of the succession planning efforts are number of positions filled by succession candidates, number of candidates in the pipeline, and retention rate for succession candidates. Companies were less like to measure success by tracking diversity of candidates, performance appraisals of succession candidates, manager satisfaction of candidates, and candidate satisfaction of development opportunities.
"Measuring the success of all ongoing programs is a business best practice," the report says. In addition to statistics such as time-to-fill for leadership positions and diversity of candidates in the leadership pipeline, Doris Sims Spies suggests in her CTDO article "Tap the Value of Succession Planning" that surveying employees and management to determine how they see the value of the organization's succession planning efforts also can be a valuable evaluation metric.
Read more from CTDO magazine: Essential talent development content for C-suite leaders.