Having the right people, with the right skills, in the right positions is paramount to sustaining an organizations growth

and success. Identifying key positions, critical knowledge and skills, and the talent needed to meet short- and long-term goals should be top of mind for every business leader. Equally important is the process of developing and advancing employees in the succession pipeline. Analysis of this research leads to recommendations on the creation of metrics, candidate selection, and key practices to cope with barriers to effective plans that business leaders and learning executives will find especially useful. Succession planning is viewed as the process organizations use to identify the key positions, candidates, and employees needed to meet both the short- and long-term challenges inherent in conducting operations. The process also encompasses companies efforts to develop and advance selected employees in the succession pipeline. While many organizations acknowledged the importance of planning for successors for leadership and other vital positions, fewer than half of those surveyed (45 percent) said their organizations have a formal planning process in place. Among those in firms that do not have a formal plan, just over half noted that their firms do have informal plans. The current study suggests, however, that informal plans are not as effective. Some respondents said their organizations are extending their succession planning well beyond top management levels, choosing to include managerial, technical, and professional positions in their planning efforts as well. But the greatest proportion72 percentsaid their succession planning addresses positions at the vice-president level. In addition, many confirmed their use of technology to enhance speed, efficiency, and accuracy in handling information pertaining to various aspects of succession planning. Further analysis of those results found a correlation between internal sourcing and success in the planning process. Participants were even more adamant about who should have a hand in identifying potential candidates for inclusion in their succession plans. Three out of four said they rely on nomination by a senior leader to guide their organizations choice of potential leadership talent. Companies also consider an employees high-potential designation to be a flag for the succession program. Our analysis found a handful of selection methods to be particularly potent contributors to greater success in succession planning. How to measure success Implied in any inquiry about an organizations effectiveness in succession planning is the assumption that the firm is using one or more methods to assess the outcomes it is achieving. Many study participants confirmed that their organizations are using one or more metrics to gauge succession planning success, but the overall findings show that none of those metrics is enthusiastically embraced as a must-have. Indeed, theres a worrisome underutilization

of metrics in succession planning. Among the most favored tracking mechanisms were positions filled by succession candidates, retention rates for succession candidates, and the number of candidates in the pipeline. While a number of stumbling blocks were identified, the most cited was the organizations own failure to provide robust development plans for succession candidates. Certainly, this admission offers learning professionals an opportunity to step in with more comprehensive and effective programming. Other planning pitfalls include issues with funding, an inadequacy of metrics to gauge success, and insufficient communication about the succession planning process. Effective strategies for developing candidates Organizations can improve their chances of success if they ensure that competencies for leaders align with business objectives and strategies. Integrating succession planning with other talent management programs and customizing training for each candidate also are among the insights to come out of the current study. In short, various options exist for organizations to improve their effectiveness in succession planning, especially in the leadership development stages. Organizations need to discover the strategies that will work best for them. Goldsmith (2009) suggests that more successful outcomes might follow if companies change the name of the process from succession planning to succession development. Succession Planning Success Index (SPSI) Market Performance Index (MPI) For what reasons did your organization adopt a formal succession planning process? Identify and prepare future leaders Assure business continuity Create opportunities for internal advancement Retention Fill future vacancies created through retirement Prepare for business growth/expansion Address projected talent shortages Deal with a skills gap among employees Address change effectively Handle emergencies or threats effectively Reduce financial and operational costs for external recruitment Other But long-term survival is not the only rationale for succession planning; clearly, there are important links to talent management. Creating opportunities for internal advancement,

for example, is a motivating factor for nearly two-thirds of respondents. Meanwhile, addressing projected talent shortages and aiding retention were also cited by more than half of respondents. One Study participant stated the case for succession planning simply and clearly: We are losing talent, missing developmental opportunities, and losing knowledge because we dont have a formal succession plan in place. Loss of productivity, lack of continuity in management, inability to execute strategy, ineffective utilization of human capital, and lowered morale are just a few of the potential negatives that might be anticipated because of pooror absentsuccession planning. Perhaps our Study respondents state the perils of planning failures most eloquently: Not having a succession plan puts the organizations continued success at risk. Key knowledge could be lost because it has not been transferred. We have lost a lot of talent. We have lost key contributorsand it took valuable (and lengthy) time to fill the job and cover those responsibilities. You have to build a bench or you will be lost when folks leave. Short-term business decisions can have long-term implications. Stars are identified and groomed by appointment to projects [and participation in] educational activities, said one respondent. Another described a loose confederation of programs such as the mentor program and the performance management system; outputs and reports from these programs are used as documentation when succession planning occursusually on an ad hoc basis because of the current recession and the nature of our business. A third stated, [G]enerally, as management positions become vacant, we promote from within. For higher-level managerial positions, we try to identify up-and-comers and get those people opportunities for growth and responsibility. We have also just created a leadership institute that identified three individuals that are given assignments and responsibilities for higher-level skills development.