by WEX Benefits
Developing an effective succession plan is vital to business success, affecting talent development, retention, and your leadership model. One survey found that 92 percent of respondents said it was risky to not have a succession plan, but only 25 percent of companies were identifying adequate successor candidates for key positions.
In our latest episode of Benefits Buzz, we discuss succession planning with Bethany Berkeley, CEO and co-owner of Dale Carnegie Training in North Dakota and Minnesota. Keep reading and watch our episode below to learn what succession planning is and what you can do to get started.
What is succession planning?
Succession planning helps to ensure that your business has individuals in place to step into roles when the need arises. While some believe that it’s only for the largest companies, businesses of all sizes can benefit from more focus on succession planning.
“It’s a process for identifying and developing new leaders to replace old leaders when they leave, retire, or die,” Berkeley said. “The thing is most people start looking at succession planning when they know people are going to be retiring, and that’s usually way too late in the game.”
Berkeley encourages businesses to look at succession planning more proactively as part of their talent development, which means recruiting individuals who fit within the pipeline on Day 1.
What are the benefits?
There are benefits for the business and, specifically, its employees when you’re focused on succession planning. Berkeley said employees are happier and are less likely to leave. On the business side, there’s less disruption in cash flow and revenue.
“There’s the purely business benefit and the workforce development,” Berkeley said. “And they’re very much connected. … People are happier, they’re more engaged, and they’re going to stay longer, because they’re given opportunities to learn in a more dynamic way, a more intentional way.”
What are some steps to get started?
How does your business handle succession planning today? If you’re just dipping your toes in this very important topic, Berkeley has a few suggestions to help you get started:
- “I always encourage leaders to take a look at the why first. Why is this important? What is our end goal?,” Berkeley said. That includes workplace culture but also the bottom line. Setting goals is crucial before embarking on succession planning.
- Hiring with succession planning built into the process is an important component. Every level needs to have someone who is ready when the need is there. “Looking at every single level of the process with a lot of strategy, and not just looking at the hard skills component,” Berkeley said.
- Berkeley’s one takeaway for you: Ask yourself who would take over for you if you didn’t show up for work tomorrow. Are you ready? Is your business?
For more on how to get started with succession planning, check out this Dale Carnegie Training resource.
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The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own counsel.