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ABSTRACT
Purpose of the study: The purpose of the study is to gain knowledge on the concept of succession planning and initiatives taken by the company for developing their future leaders. As many Indian organizations are owned and managed by owners, therefore they do not have formal succession planning process, with which they face problems in future. But some organizations have also excelled in that and giving good leaders to their organization.
Significance of the study: Succession planning involves planning for the smooth continuation of a business through the transfer of power between incumbent leaders and managers and succeeding ones. The key objectives are to maintain business and organizational continuity and cause the least possible disruption to an organization's business operations and overall effectiveness. Succession planning ensures backups and exigency positions for each senior manager and leader in an organization. These managers are groomed to take over departmental roles or fill critical leadership positions during designated periods. Therefore study helps to understand the process involved and future initiatives of company.
Objectives of study:
• To study the importance and role of Succession Planning in Corporate World
• To study the initiatives done by the organizations in developing their internal talent
• To study the role of HR department in Succession Planning
Scope of the study: The scope of succession planning would be more when the organization grows steadily and employees have potentialities to take up higher positions. The companies have realized its importance and are directing their efforts in order to fulfill the objectives of organization and to have smooth functioning of the organization.
Research Methodology: The collected data is secondary data based on the second hand information through articles, case studies and companies related examples. 12 companies’ initiatives and processes are studied from which data gathered about their efforts for succession planning is gathered.
Findings of the study:
• It has been found that the companies are realizing the importance of succession planning are doing efforts for developing their internal talent by providing them more training and development opportunities.
• Most of the Indian organizations are family run businesses, and they are expanding their businesses across the globe therefore in order to succeed in such a global environment they are paying more attention toward this and are seeking professional help.
• Some renowned companies like GE and Infosys have their own institutes where they train and develop their future leaders.
• L&T relies more on internal talent and before hiring from external they make comparisons first and consider other aspects also.
• The rationale behind all the initiatives is that all the professionals who are identified as ‘change drivers’ should not merely be leveraged for a specific business of the company, instead they should be instrumental in driving change across the varied businesses
• The companies should have a participative culture so that employees can freely express their feelings, share views, generate ideas and choose their future leaders.
Recommendations:
• The organizations should address to this issue as early as possible because if they fail, then the organization may end up facing the burden in the middle of a crisis.
• The companies should have formal succession plan, which would ensure talented candidates with required potential and competencies to take the high positions in future and help in growth.
• The succession plan must belong to the whole organization and not to the HR department in order to make sure it has the attention it deserves.
• The companies should de-link the ownership and day-to-day management of operations and seek professional help in critical matters.
• The employees should be motivated and provided with appropriate training and development, so that they can have feeling of self-belongingness towards the company.
• Equal opportunities should be given to female employees so they can also take key roles and encourage others.
1. LITERATURE REVIEW
(2008) Stacy Straczynski: In a new study, released by Tampa-based Achieve Global, a global workforce management firm, 144 respondents with the title of vice president or higher shared their insights on their organization’s succession strategy. Results show that the majority (51%) currently do not have a succession plan in place for C-suite executives—positions that include chief executive officers, chief financial officers, chief operating officers, etc. This is particularly troubling for American businesses, as 16 percent of respondents also indicate that they have an existing vacancy in their C-suite and another 37 percent indicate that they anticipate a vacancy within the next year
(2009): .A new global study of more than 2,500 Chief Information Officers (CIOs), released by IBM today, reveals that leveraging analytics to gain a competitive advantage and improve business decision-making is now the top priority for CIOs.
Key findings of the survey include:
• CIOs also are continuing on the path to dramatically lower energy costs, with 76 percent undergoing or planning virtualization projects.
• 76 percent of CIOs anticipate building a strongly centralized infrastructure in the next five years. Furthermore, more than half of CIOs are expecting to implement completely standardized, low-cost business processes.
(2009): The study’s findings:
• More than half of survey respondents said their companies implement succession management processes at only the most senior executive levels.
• Only 12 percent of respondents said their companies’ succession management programs are integrated with talent management programs, such as performance management and employee development.
• Fewer than 40 percent of respondents said their companies include mid-level managers and skilled professionals in succession planning initiatives; just 11 percent included first-line supervisors.
(2010) Mark Vickers : Development in partnership with i4cp, shows that a mere 14% of respondents describe their organizations' succession planning efforts as effective to a high or very high extent. In other words, most think their company's efforts are mediocre or worse. Two things are found: 1) there's a striking and worrisome absence of solid metrics in regard to succession management, and 2) the metrics that are most commonly used are very basic indeed. Among those with succession planning programs, a meager 36% even track the positions filled by succession candidates to a high or very high extent and just 31% track the number of candidates in the pipeline to that same extent.
2. INTRODUCTION
2.1 SUCCESSION PLANNING
Succession planning is a process of determining critical roles within the company, identifying and assessing possible successors, and providing them with the appropriate skills and experience for present and future opportunities.
In other words succession planning comprises of these important steps -
• Recruitment and staffing - you recruit superior and right employees
• Training and development - you train the employees to develop their knowledge, skills and abilities
• Performance and Compensation management - prepare them for advancement or promotion into ever more challenging roles
• Other (in which talent management plays a role) - you are prepared to retain or replace superior employees
Typical activities covered by succession planning include -
• Determine what roles and skills are critical for the growth of the company
• Analyze and address the gaps revealed by the planning process
• Identify and understand the developmental needs of employees to fill those positions
• Ensure that all key employees understand their career paths and the roles they are being developed to fill
• Train people for skills and positions that are not presently existing in the company
• Understand the time needed to backfill key roles
• Enrich succession plans through regular executive discussion of people and posts
• Identify top performers in all departments and make sure that they are engaged and satisfied to stay with you for a long period
• Continually review and check the process of succession and whether planned individual development has taken place
Succession planning is a process by which successors are identified for key positions throughout an organization including vital roles in each department of the organization. It should take into account the strategic vision and objectives of the organization. With good succession planning in place, employees are ready for new leadership roles so when someone leaves the company, another is skilled and ready to step-up to that position. Succession planning can also help develop a diverse workforce, by enabling senior management to look at the future goals of the organization as a whole. So the key issues the HR professionals should consider while developing a succession plan are –
• Strategic plans and future goals
• Workforce requirement
• Knowledge retention and critical roles
• Talent management strategies