The purpose of a succession plan is to help prepare for sudden changes, and the lack of one can be costly. We are here to help you kickstart the planning process!
A succession plan is an essential tool for ensuring a company's operational capability even in unexpected situations. More specifically, it is a strategy to ensure that in the event of a personnel change, operations do not paralyze, and critical know-how remains available. At its simplest, it can be about backup roles: a deputy is named for every key person to take responsibility when needed.
A succession plan prepares the organization for the unforeseen and makes it easier to react. In short, it answers the question: How do you replace a key person if they are no longer available?
Why is a succession plan needed?
"A detailed plan must be in place before the situation becomes critical. If one hasn't been drafted yet, now is the time to start," says Marcus Åberg, a People Plan Specialist at Academic Work Sweden.
His responsibility is to help companies develop their personnel plans and employer branding. According to him, the lack of a succession plan is one of the most critical risk factors in HR management.
"Allocate resources proactively now, rather than waiting until the situation is already upon you and the milk has spilled," Åberg continues.
Surprising situations, such as the illness of key personnel or mass layoffs, are always difficult. Without a detailed succession plan, running daily critical operations can become extremely difficult—or in the worst case, impossible—when key experts are absent.
"The most important thing is to ask yourself: do you know who your organization's key experts are, and do you know who will replace them if the situation requires it?" Åberg advises.
Succession planning refers to the process of identifying and developing future leaders and other responsible individuals within the company. It is not just about C-suite roles, but about all key responsibilities at different levels of the organization.
How does the current era of uncertainty affect the need for a plan?
The COVID-19 crisis is a perfect example of a sudden situation: the impact it has on your company depends largely on how well you prepared for sudden disruptions in the first place.
"It is extremely important to map out which skills are most critical and plan the steps for different scenarios. With a good plan, your company is even better prepared for constantly changing situations," Åberg encourages.
"Predicting was difficult even before the current crisis, but now it is nearly impossible. For this reason, creating several alternative contingency plans is by no means an exaggeration. A succession plan is one of the most critical pieces when preparing for the future—no matter what that future looks like," Åberg adds.
Succession Plan 1.0 – First Steps
If your company does not yet have a succession plan, it is best to start drafting it now. We have listed the first steps for you:
- Examine your current and future needs: Identify the roles most critical to the business and the skills essential for those roles. Remember, these aren't just leadership positions—expert and support roles can also be pillars of the business.
- Check for natural successors: Are there informal successors already in the organization? If not, is it possible to build growth paths, for example, from junior levels upward?
- Equip supervisors: Ensure they have the incentives, tools, and skills to support team members' progression. Some companies even evaluate supervisors based on how well they encourage their team to learn new skills.
- Build a learning culture: Focus on creating a company where personal and professional development is central, making it a place where top talent wants to build their careers.