SUCCESSION PLANNING AND RISK MITIGATION
An essential component of doing business and one of the most crucial tasks facing companies is succession planning: the identification and development of in-house candidates for leadership and key expert positions – an undertaking fraught with difficulties that should not be underestimated.
It is true that many organisations fail to allow adequate time to identify and to develop potential internal leadership candidates. In the small to medium-sized business bracket this is a real problem, as it is in big companies, although larger firms are typically required by their boards and shareholders to conduct succession planning. Without an active succession plan, companies become dependent on the external talent market, and top employees are more likely to leave the organisation because they don’t see a career path.
Whatever its size, a clear and comprehensive succession plan should be in place in every organisation. A well-designed employee pipeline can reduce disruption to the business, retain key employees and reduce external recruiting costs.
When organisations conduct regular and effective succession planning, the benefits are self-evident: security and stability. A case in point is the succession of Tim Cook to the role of Apple chief executive in 2011, following the death of Steve Jobs. Before his death, Jobs had publicly stated that Apple should execute its succession plan and name Cook as the new CEO. Jobs thus publicly selected and endorsed the new leader.
Jul-Sep 2016 Issue
Fraser Tennant