New Zealand businesses are woefully unprepared for succession planning. Some business owners think succession planning doesn’t need to be on their radar, especially if they have no intention to exit the business in the next ten years or more.
But there is a crucial part of succession planning that is often overlooked that can impact all organisations at any stage; when a key staff member or specialist leaves the organisation.
It’s vital that business owners and leaders start forward planning for when key people move on. In today’s working environment it is a matter of when, not if, this will happen to your business.
Business owners and leaders shouldn’t be surprised by employee churn. It’s a well researched and documented fact that the number of career changes and positions held have increased dramatically in the last fifty years. We change jobs, industries and careers multiple times over our working life.
A major employment survey in New Zealand by Lawson Williams Consulting Group and the Human Resources Institute of New Zealand shows the national average staff turnover in 2015 was 18.4%. That’s nearly one in every five employees being a new addition to staff teams across the country.
The Hudson Report found 63% of professionals in New Zealand were either actively or passively looking for work. Only just over one third expected to be in the same position in twelve months.
Nowadays business owners and leaders can expect staff to change roles every two to three years. While some will be role changes and promotions within the organisation, this still demonstrates the neccessity for all businesses and non-profits to manage succcession planning of key roles.
The benefits are many. Your organisation will end up retaining important knowledge and skills. Business continuity will not be impacted when people leave. It will also reduce training and orientation time when key positions in your business change.
Think about your business and you will immediately be able to pinpoint some positions or staff members that are critical to your ongoing success. People in these roles have an incredibly complex collection of knowledge; much of which is based on experience and is difficult to replace quickly.
Sometimes it is the skillset a person has rather than the role inself. To make sure you identify all key roles and skillsets in your organisation, ask yourself these questions:
- Who holds strategic roles and has knowledge in critical areas?
- When there’s a problem, who do people consult first?
- Whose job is highly specialised and/or whose skill set is unique?
- If left open, which position would significantly hurt your business?
- Which positions would be difficult to fill, because they need particular technical expertise or a high degree of corporate knowledge?
- Which positions are facing a labour or market shortage?
Once you have identified the roles and skillset that are crucial set out a strategy for succession. Your plan needs to have a dual approach of retention to keep staff longer and for succession to fill vacancies when people leave.
Effective and proactive succession planning is an important element of a successful business. If you’re not already doing this, then it’s time to make it a priority.