Succession Planning Summary
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Summary
Succession planning has everything to do with the future of the company. Proper planning will ensure a smooth transition after the exit of the current leadership. Succession planning is more than planning the exit of the current administration. It goes further to look into the future of the business. It involves developing working systems that will ensure the business entity continues even after the current managers' exit and continue to do so effectively.
There are several succession plans available for companies. These include looking for a successor internally, looking for a replacement externally. A company may also opt to sell out to another company all go into liquidation, or rather wind up and sell all its assets.
There are several challenges facing succession planning. These challenges determine the success or not of any company. Some of these difficulties have to do with lack of requisite knowledge by those involved in success planning. Some of them have to do with human resource development. Such include talent development and skill training. There are also those that require technology that has to do with automation of a company's operations.
The way forward for succession planning is educating companies on the need for succession planning and sensitizing them on the new trends. There is a need to build robust processes to overcome the challenges envisaged in planning for a succession. It should be formalized and include talent development and skill training. Automation will also form an essential part of succession planning.
Technology forms an important part of succession training. It is important for leaders to be up to date with current innovations in technology while formulating a succession plan to make sure that the company attains a competitive advantage over the rest. That should be done in mind that ignoring technology could mean the death of the business entity. Potential successors should be acquainted with the modern technological developments so that they can run the business in the current market trends.
Succession planning has to put in mind the human resource requirements of the company. Both existing and future labor needs of the company should be taken into consideration while developing a succession plan.
The survival of the company should be the focus of any succession plan. Planners should concentrate on the future of the business while thinking of an effective succession plan. Those involved need to have the future of the business in mind when working out a succession plan. It is vital that planners work towards a smooth transition while developing a workable succession plan.
There remains a research gap for succession planning. The place of technology needs to be the point of focus while thinking about a succession plan. It is also vital to find out why many companies have not put a succession plan in place despite knowing the significance of such a plan towards the existence of the company as well as efficient operations in the company. This research gap should form the point of study for the researchers to suggest how actually succession plans can be taken up by companies.
Two theories or models have been used to explain succession planning. The Scharmer's U model consists of five movement stages, namely, co-initiating, co-sensing, presencing, co-creating and co-evolving. On the other hand, there is Santorin's Relay Succession Model that suggests passing the baton over an extended period.
Conclusion
Succession planning is a vital component of any company's strategic plan. One fails to comprehend why many companies have been unable to put in place effective succession plans despite having knowledge of the need to have one. It is observed that most leaders acknowledge that succession planning forms a pivotal role in a company's corporate plan. However, these companies are unwilling to put in place effective successive plans.
According to available research, planning for leadership succession should be part of the way a company should be managed. This process involves grooming potential leaders (Avelino & Rotmans, 2009). This process takes time and companies need to invest time and resources. Leadership succession should be entrenched in the company’s strategic plan.
There are many options available for companies conducting a succession. They can choose to have an internal successor or an external one. Whichever plan the company wants, there is merits and demerits. Therefore, a company should choose a plan that best suits its needs. However, businesses should focus more on the sustenance of the business rather than wind up. Selling of the business should not also be considered as an option if a company has a proper succession plan in place. Those starting up businesses should have the future of the business of such businesses in mind before they even start.
It is possible to create successful businesses that go on for generation after generation and this requires adequate planning. Without proper planning, such businesses are doomed to failure. As the Chinese proverb states, "a person who does not worry about the future will shortly have concerns about the present." Many companies are not planning for their succession, and therefore, executives need to think deeply about better successful plans that will ensure sustenance of their companies, so they stand the test of time and run for generations.
The future of any company lies in how effectively such a company adopts a succession plan. Failure to establish a succession plan could insinuate that the business is on its way to closure. A business that does not choose an effective succession plan may not have a future especially with the current market trends for businesses. The global opening means that many companies will have to deal with competition from not only local competitors but also international ones. Those that do not give serious time and resources to proper planning will have either to wind up or sell out. Companies will have to change their strategies on succession planning to survive in the market. Succession should be a core strategy in the business model for any company (Amburg et al. 2011).