Succession Planning Process



Human Resource Forecasting

Human Resource Forecasting refers to the interaction between the decision maker’s
perceptual and cognitive processes and the objective characteristics of their environment. There are
a number of important elements to consider in order to successfully forecasting labour demand and
supply: identifying stakeholders who will be involved, determining the appropriate planning
horizon, and defining the internal and external labour force.

The Human Resources Planning Team

The Human Resource Planning team should include all relevant stakeholders across multiple
functional areas and organizational levels. Explicitly developing a team for the Human Resource
Planning process helps to ensure success of the strategies within the plan and holds those who are
not meeting the goals accountable. It is critical not only to align the Human Resource plan to the
organization’s strategic plan, but to also communicate how the plan will affect future operations,
financial goals, and market position of the company. Doing so will build the confidence of the
leaders and convince them that the change is required.

Determining the Appropriate Planning Horizon

The appropriate planning horizon is a judgement about how far into the future predictions
can be made, taking into consideration acceptable levels of operational, organizational, and
environmental uncertainties. This is very subjective as it is based on the decision maker’s cognitive
processes and perceptions of the organization’s position in the market

Human Resource Skill Inventory

A skills inventory is a system designed to take stock of information about current
employees’ experience, education, compensation history, and/or unique abilities. A skills inventory
can be useful in revealing what skills are immediately available in an organization by providing a
snapshot view of the existing talent in an organization. Identifying current workforce dynamics is a
critical step in the development of a Human Resource plan.

Human Resource audit

Human Resource audit is a systematic examination and analysis of an organizational
workforce to develop an understanding of the current staffing situation. The Human Resource audit
compares the past with the present labour specifications to identify trends and patterns in multiple
aspects, including turnover, training, absence, and diversity. It helps to identify key information
about Human Resource operations, including how well they work, and where improvement may be
needed. It is a useful tool in Human Resource planning. The information provided in an audit or
skills inventory can be useful in identifying a number of workforce trends.

The Management Inventory

It is not common for enterprises to keep an inventory of available Human Resources,
particularly managers, despite the fact that the required number of competent managers is a vital
requirement for success. Keeping abreast of the management potential within a firm can be done by
the use of an inventory chart which is simply an organization chart of a unit with managerial
positions indicated and keyed as to the promotebility of each incumbent. At a glance, the controller
can see where he or she stands with respect to the staffing function. The controller's successor is
probably the manager of general accounting, and this person in turn has a successor ready for
promotion. Supporting that person, in turn, is a subordinate who will be ready for promotion in a
year, but below that position are one person who does not have potential and two newly hired
The need for managers is determined by enterprise and organization plans and, more
specifically, by an analysis of the number of managers required and the number available as
identified Human Resource through the management inventory. But there are other factors, internal
and external, that influences the demand for and supply of managers. The external forces include
economic, technological, social, political, and legal factors. The economic growth may result in
increased demand for a product, which in turn requires an expansion of the work force, thus
increasing the demand for managers. At the same time, competing companies may also expand and
recruit from a common labor pool, thus reducing the supply of managers. One should also consider
the trends in the labor market conditions , the demographics, and the composition of the community
with respect to knowledge and skills of the labor pool and the attitude toward the company.
Information about the long-term trends in the labor market may be obtained from several sources.

External Labour Force
The external labour force refers to potential sources of Human Resources outside of an
organization that can affect the future supply of employees. Evaluation of the external labour force
relies on labour market estimates based on regional and global economic, environmental, and
demographic changes. Economic and environment factors include interest rates, unionization,
economic growth, unemployment rates, and political climate. Demographic factors include
population-based information such as retirement rates, birth/mortality rates, educational attainment,
primary language, labour shifts (location), etc. Since the external labour force provides designated
group members from which the employer can reasonably be expected to recruit.

Succession planning

Succession planning is a conscious decision by an organization to foster and
promote the continual development of employees, and ensure that key positions maintain
some measure of stability, thus enabling an organization to achieve business objectives. Succession
planning has sometimes taken a replacement approach, often focusing on executive-level positions.
One or two successors might be identified and selected, probably based on the exclusive input of
their immediate supervisor, and then placed on the fast-track into a senior position. However,
succession planning has evolved into a process that can be used to:

1. Replenish an organization’s Human Resource at a broad or specific level;
2. Identify, assess and develop employee knowledge, skills and abilities to meet the current and
future staffing needs of the organization; and
3. Ensure a continuous supply of talent by helping employees develop their potential.

Succession Planning Process

succession planning will vary slightly between organizations. Different resources, different
organizational designs and different attitudes all mean that succession planning should be flexible
and adaptable in order to accommodate varying needs and achieve business continuity. However,
there is a general framework that departments can use as the basis and guide for their succession
planning activities. This framework involves:

Step 1 – Identifying Key Positions or Key Groups

A key position can be defined in many different ways, but two important criteria that should
be considered are criticality and retention risk. A critical position is one that, if it were vacant,
would have a significant impact on the organization’s ability to conduct normal business. The
significance of the impact could be considered in terms of safety, operation of equipment, financial
operation, efficiency, public opinion, and so on. Retention risk refers to positions where the
departure of an employee is expected (e.g. retirement) or likely (e.g. history of turnover). By
examining these criteria on a low-to-high scale, an organization can determine what positions
require short- or long-term planning.

Step 2 – Identifying Competencies

All positions demand set of knowledge, skills and abilities that are expected of employees
who are filling that function. Thus, knowing the competencies of a job is a mandatory component of
recruitment. However, succession planning provides an opportunity to review the competencies
traditionally associated with jobs, particularly with respect to current goals and objectives. Several
ways to determine and develop required competencies include:
1. Reviewing job descriptions, advertisements, and relevant merit criteria
2. Interviewing current and former job incumbents
3. Interviewing supervisors, clients, and other stakeholders
4. Conducting focus groups or surveys
5. Reviewing any existing development programs (i.e. leadership competencies)
6. Reviewing organizational values

Step 3 – Identifying and Assessing Potential Candidates

The objective of identifying and assessing employees against core job competencies is to
help focus their learning and development opportunities in order to prepare them for future roles in
the organization. Given the potential sensitivity around the decision-making process in these
situations, an employee might be
advised about their prospective opportunity for advancement in private. This process is not
transparent and can negatively impact the morale of other employees and their relationship with the
organization. Modern approaches to succession planning suggest that transparency and
accountability are the best practices for an organization. Recruitment in the public service is based
on merit, fairness and respect, and these concepts are maintained and supported by the succession
planning process. Therefore, succession planning must be:

1. Objective and independent of personal bias;
2. Merit-based;
3. Communicated to and understood by all employees; and
4. Transparent at all stages of the process

Step 4 – Learning and Development Plans

Once the relevant candidates have been identified, the organization must ensure that these
employees have access to focused learning and development opportunities.
Some key points to remember when developing learning and development plans are:
1.Plans should focus on decreasing or removing the gap between expected competencies and the
current knowledge, skills and abilities of candidates.
2. modern succession planning is based on learning and development to fulfill employee potential,
rather than merely filling a vacancy.
3. There are a wide range of learning and development opportunities to consider, which can include:
1. Job assignments that develop candidate’s competencies;
2. Job rotations; and
3. Formal training.
4. Ensure appropriate strategies are in place to support the transfer of corporate knowledge to
candidates for key jobs, which can include:
a. Mentoring, coaching or job-shadowing;
b. Documenting critical knowledge;

Step 5 – Implementation and Evaluation

Evaluating succession planning efforts will help to ensure the effectiveness of the process by
providing information regarding:
1. How the process operates – the relationship between inputs, activities, outputs, and outcomes
2. Impact of the process relative to stated goals and objectives
3. Functional strengths and weaknesses
4. Potential gaps in planning and assumptions
5. Cost-effectiveness and cost-benefit