Is succession planning still contemporary? 

In the context of talent management, succession planning is crucially important. Succession planning is attracting more attention in an era of rapid changes and increasing individualisation. It not only provides a tool for risk minimisation, but also makes a significant contribution towards employee loyalty and development.

Historically, succession planning meant safeguarding company jobs when an employee left. Concepts such as risk minimisation, stability and continuous growth were some of the initial aims of succession planning. In the process, companies focussed on "boss level" and clearly defined key positions.

Changed framework conditions, such as increasing individualisation, also mean that the aims of succession planning have developed. The focus has shifted to developing employees. Talent development programmes, career paths and promotion plans have been introduced to offer employees longer-term prospects and development opportunities. But how appealing are such approaches in today's world of digitalisation and transformation? As studies show, companies put succession planning low down on the list of priorities: 56% of all companies surveyed did not have succession planning, 21% had a formal plan and around 24% had informal succession planning in operation (2021 survey of 580 interviewees in HR).

But it is precisely in such uncertain times with constant change, such as today's omnipresent job hopping (a good one-third of employees change jobs after at most one year) that succession planning becomes more important. Also, according to a global study by Oracle, 85% of employees are dissatisfied with their company's career support. The same study shows that 43% of employees would be ready to relinquish part of their salary in order to gain improved access to development opportunities.

It is therefore elementary for companies to increase employees' planning security and loyalty. New, modern approaches are needed for this. 

What does modern succession planning look like?

As the first post in this series mentioned, we are at an exciting turning point that will highlight the way for succession planning, as greater attention must be paid to the following employee needs in particular.  

• Co-determination:Basically, employees want more co-determination, including in succession planning. As is widely upheld academically, intrinsic motivation increases employee satisfaction, which in turn keeps employees in the organisation for longer. It is therefore worth finding ways to include employees more in the succession planning process and in this way to keep them more satisfied in the longer term.
   
• Individuality and flexibilisation:The modern working world allows employees the freedom to choose where and when they work. Succession planning should take account of this trend too, in order to address individual needs more closely. Flexible work models, such as job sharing or geographical independence, are further reference points for succession planning.
   
• Increased transparency:Decisions should no longer be taken in quiet corners, but should be more multidirectional. It is worth taking a wider view and including employees as well as managers in order to identify possible successors. A visual representation can be very helpful and is available almost at the touch of a button with today’s digital tools.
   
• Increasing the employee experience:The new generation increasingly requires positive and meaningful employment experiences. Digital solutions in particular can help here by making a succession planning process accessible everywhere. Learning opportunities necessary for progress can also be made available in this way.

Specific recommendations 

Cultural and technological adjustments are necessary in order to establish a modern succession planning process and to meet the changed requirements. Here is some advice on exactly how this could look: 

1. Participatory process:Address the need for increased participation. This can be achieved through transparent communication. Talk to your employees frequently about development opportunities, and at the same time win their buy-in. Reach joint agreements on specific next steps without stipulations; instead, encourage the employees to do this themselves. A participatory process with open communication helps to avert different perceptions at an early stage (e.g. you see someone in a specific new role in the future, but that person is not interested in a move, or vice versa). Also, in this way you are giving the employee the feeling that they are also determining the process. One problem to be considered here is the fact that such discussions can quickly give rise to expectations. Prepare such discussions carefully and don't make promises you can't keep.
    
2. Openness to freedom and flexibility:In order to fulfil this requirement of today's generation, it is necessary to relinquish entrenched and rigid thought processes. For example, you need to be more receptive to the idea of a flexible division where succession to a key position is concerned. Why shouldn't a key position continue according to a job-share model, just because in the past it has only been occupied by one person? Obviously the administrative processes for such cases must be in place, but there are now many tools available to support this as a result of HR digitalisation. Basically, other trends such as geographical or time flexibility, which should no longer be criteria for exclusion when taking a decision on succession, are also affected by this.
    
3. Creation of a digital platform: Optimise the employee experience through digital solutions that increase transparency for employees and managers. Expand the succession planning population and allow employees to be part of their own career development and that of your organisation. One tool that we ourselves like using and which we can recommend is SAP SuccessFactors Succession & Development.

Summary and key messages 

Succession planning may not always be top of the list of priorities, but it offers enormous potential for improving corporate performance, particularly in uncertain times. The opportunity for employees to participate is a key factor in modern succession planning. Listen to your employees and shape the future together. Create openness to greater flexibility and individuality in your organisation in order to increase employee loyalty. In addition, the use of digital solutions can minimise the administrative load and provide targeted support for the succession planning process.

Our series of blog posts on talent management has covered key areas such as recruitment, onboarding, learning and development, performance management, compensation and benefits, and succession management. In summary, it is apparent that a holistic approach is required. Successful talent management requires that you not only attract employees, but also retain and develop them in future. Modern methods such as flexible processes, individual development, transparent compensation and strategic succession planning are decisive in order to be successful in today's dynamic work environment.

To the Blog:

• Intro - Turning Point
• Recruiting Management
• Onboarding
• Development & Learning
• Compensation & Benefits
• Performance Management

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Sources:

• https://www.qualtrics.com/uk/ebooks-guides/2023-ex-trends-report/ 
• https://www.shrm.org/hr-today/news/hr-magazine/spring2022/pages/succession%20planning%20is%20critical%20in%20uncertain%20times.aspx 
• https://www.wtwco.com/de-de/insights/2022/05/die-neue-employee-experience-post-corona 
• https://www.oracle.com/de/a/ocom/docs/applications/human-capital-management/2022-the-year-of-the-great-retention-de.pdf  

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