Employee retention is more critical today then ever before. Not only is the current candidate pool small, (there are more jobs than unemployed workers in nearly all industries), but the current labor force is shrinking. It's been reported that Baby Boomers, those born between 1946 - 1964, are retiring at a rate of 10,000 per day. Succession planning is the answer to keeping the employees you currently have while solidifying your company's future.
What is Succession Planning?
According to SHRM, succession planning is a process that keeps your talent in the pipeline. It identifies strengths and weaknesses in your employees by looking at the job skills, knowledge and practices they possess that can be used to fill other roles in the company and pass along to the next generation.
Your company needs loyal, productive employees to grow and prosper. Succession planning keeps your workforce developed and reduces risks associated with talent gaps and employee turnover.
Four Ways Succession Planning Helps Your Company
1. Succession Planning Goes Beyond Traditional Development
You probably have development plans currently in place for your employees, like webinars, memberships to professional associations, expert speakers and mentors, but succession planning takes it a step further by lasering in on how your employees can grow at your company. For example, if your company will need to fill management positions, add leadership training for those employees who can be successors. It comes down to assessing your company's vulnerabilities and gearing performance management towards a solution. Using employee management software provides training options and a clear path for your staff to pursue.
2. Succession Planning Boosts Employee Retention
When you invest in your employees, they become invested in your company. According to The Balance Careers, employees who know they have a future role at a company receive a boos tin their self-esteem and self-respect, improving their productivity in the present. Employees will stick around knowing they have a future with your company.
3. Succession Planning Closes Position Gaps
It's never a good idea to put all your eggs into one basket, especially when it comes to who handles responsibilities at your company. If only one employee knows essential processes, your company is at risk if that employee suddenly leaves. Succession planning software gives you a side-by-side view of what everyone does at your company and who has the skills to take over said responsibilities. If talent gaps do exist, you can take steps to create performance plans to fill in those gaps.
4. Succession Planning Saves Money by Decreasing Turnover
The more employees you keep, the less money you have to shell out to hire new ones. In 2018, employers paid about $600 billion in turnover costs and that number is expected to increase to $680 billion by 2020. When you promote from within, you not only save recruiting costs but those expenses associated with onboarding and training new employees. You also save your current employees from having to double-up on their workload to cover the responsibilities of a essential employee who has just left.
Using succession management software, companies can compare performance data and goals to create employee development plans. BirdDogHR™ Succession Planning is a cloud-based solution that allows companies to accurately review employee performance and readiness with scorecards, comparative ratings and 9-box talent matrices. Plus it easily integrates with all of our other performance management solutions. See for yourself how it works by scheduling a demo.