Retaining your Best & Brightest is Key to a Successful Succession Plan

Published in tED Magazine on December 2014

According to a survey performed by the LMA Consulting Group (lma-consultinggroup.com) in conjunction with the APICS Inland Empire Chapter (apics-ie.org), executives said that succession planning is tied as a No. 1 priority in retaining top talent. This is especially noteworthy when considering that 87% of manufacturers and distributors are experiencing a skills gap—that is, their employees do not have enough skills to meet the ever-increasing requirements or they have lost qualified people to retirement, job transfers, etc. Yet 77% of manufacturers and distributors are struggling to find qualified candidates. In short, an employer’s ability to retain scarce top talent is considered essential.

Since succession planning is core not only to retention, but also to having a proactive approach to organizational planning for long-term sustainability, it must become a priority. As noted in the research comments, developing succession planning programs with the opportunity for employees to develop the skills, behaviors, and experiences required to be successful in the post recession era is critical.

Since businesses have become increasingly complex and customers’ expectations are elevated, employers must be prepared and adept at how to navigate myriad operational complexities while managing risk and handling increased regulations and requirements. Key elements of succession planning include:

• Performance management. A critical area of focus should start with the often overlooked fundamental: performance management. Employees should never hear new feedback during the yearly performance review process. Instead, managers and employees should meet quarterly to review progress in the prior quarter and to discuss the top priorities for the next quarter. Through the process of reviewing goals and focusing on just the essential few, managers and employees gain alignment and clarity.Once goals are agreed upon, frequent interaction needs to remain a priority. Immediate and specific positive and corrective feedback must occur. Managers often shy away from addressing problems up front because of fears that it will be uncomfortable and create unhappy employees, but, in fact, the opposite oc curs: Employees respect the rare manager who will confront reality in a constructive manner.

  Business conditions also change, even within a quarter. Therefore, goals must be flexible enough to fit within the company’s changing strategies and objectives, but it is essential that both parties remain on the same page. Conversations should occur about how the goals and resulting achievements contribute value to the company and to the employee’s career progression.

• Rating and ranking systems. Another critical priority in succession planning is to have a rating and ranking system so that executives know who to develop, fast track, and sustain. These types of systems identify star performers with high potential for certain career paths. Thus, while succession planning programs support the entire organization, they focus special attention on high-potential employees.
• Development opportunities. Providing opportunities for training, mentoring, and developmental experiences is integral to achieving succession planning objectives. Ideally, executives should implement formal mentoring programs; however, at a minimum, they should provide guidelines and opportunities for mentoring to occur. A mentor is someone who has “been there, done that.” His or her experience can be invaluable to succession planning and retention as it affords the employee the chance to learn from an expert and be provided opportunities to test new ideas, leadership styles, and the like. Planning for training opportunities is also critical to succession planning success. It is not as simple as offering a class or paying for a class. The key is for the manager to be involved in implementing a backup to support the function while the employee is in training and to provide opportunities for the employee to apply immediately the skills learned.Executives need to think about the types of experiences required for succession planning. For example, for a high-potential employee to be ready to take over as a general manager of a facility or division, it is likely important that he or she obtain cross-functional experience.

  No matter how effective the employee is at his or her current job, succession planning dictates that opportunities will be provided.

• Leadership. The success or failure of succession planning initiatives will boil down to leadership: Leaders must show up.In today’s informationoverloaded society, leaders rarely have time to dedicate to employees—but they need to remember that where they spend their time communicates their priorities much louder than what they say. When making sure the company has the bench strength to thrive, leaders need to think of time as a priority, not as a limited resource.