Succession planning: Prepare your next generation

Succession planning is a business strategy that helps ensure a company’s smooth operation when employees leave due to retirement or new opportunities. Succession planning for an organization includes strategic planning for identifying and developing new potential leaders as replacements for leadership roles that become vacant.

It also helps cut recruitment costs and prevents additional knowledge loss. Effective succession planning involves capturing and transferring institutional knowledge and ensures that crucial information and expertise are not lost during transition.

Ongoing succession planning is key to many businesses. Identifying and developing current employees during their employment keeps them engaged and loyal. Employees can be groomed for future leadership roles by mentoring, job rotation, and cross-training. Organizations that endeavor to build a culture where knowledge is shared offer opportunities for employees to grow and develop and potentially step into a vacant leadership role.

Five keys to building a plan

Successful succession planning should align with the overall business strategy to ensure that investment in future leaders is targeted and reflects the organization’s strategic direction. Formal plans should include five steps.

 

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