What is succession planning?

Doing it well means being proactive, investing in training and utilising networks to the max.

Succession planning is the strategic decision-making process around passing roles from one person to another. 

For example, most companies will have a succession plan for their CEO. That’s not to say that the current CEO’s departure is imminent. It just means that the CEO will ultimately leave one day, and the company has a plan for when that happens. 

At the board level, good succession planning is vital. It usually involves a dedicated strategy to ensure that the company’s leadership isn’t jeopardised just because one skilled person leaves their role.

Several reasons:

No matter the field or industry, people will come and go. In a post-pandemic world, this happens more often at CEO and executive level.

In the fast-paced, high-stakes corporate governance environment, leaders have huge responsibilities. One of the core ways of dealing with this is to ensure they align with their role, with the right skills, track record and belief in the company’s mission statement.

We know that change is inevitable and that we need good candidates for our leadership roles. From that, it should be evident that we can plan ahead regarding leadership to ensure any transition doesn’t leave a company in the lurch. 

Failing to plan means a company may struggle to find the right talent or pick the wrong person in a panic. In these situations, the capacity at the top levels of governance will almost immediately suffer.

• It is consistently reviewed. Any plan for replacing an individual should reflect that individual’s role and skills. If they change, the plan should too.
• It focuses on personal development. Any ideal candidates should be given the training they need. The core mantra here is to “invest in the futures of others”. 
• It involves leaders using their networks to the max. These can be enormously beneficial, illuminating potential candidates and introducing them to the company before any official replacement. 
• It incorporates your company’s values. For example, if your company aims to be more diverse at the leadership level, work this into your succession planning.

Done correctly, it fosters a new generation of leaders with the proper training and can land on their feet when they eventually take the reigns. 

Meanwhile, shareholders will breathe far easier knowing that one person’s departure is planned for in advance. This dramatically reduces the chance of any problems surfacing during transitions, filling them with more confidence.