Management Succession Planning

Information about Management Succession Planning

Published on December 7, 2009

Author: KwameAfaglo

Source: authorstream.com

Content

Management Succession Planning : Management Succession Planning Dr. H. Kwame Afaglo 2009 Management Succession Planning : Management Succession Planning Management succession planning is the systematic approach of identifying an individual or individuals to smoothly take up the role of running the establishment into the future, based on organisational direction. Institutional survival partly depends on succession of both human and material resources, however in the face of competition and or complex challenges, growth is the necessary genetic make up for industrial survival. Management Succession Planning : Management Succession Planning Inasmuch as every establishment has its own form of succession, today’s complex challenges , competition, change, diversity and globalised standards requires a logical process of succession in other not be become extinct (fold up). The sage’s saying; ‘The young shall takeover from the old’ has transformed in the industrial set-up as: ‘Potentially capable young shall takeover from experienced aged’ Management Succession Planning : Management Succession Planning Whitwam, D. the CEO of Whirlpool Corporation places emphases on succession as: ‘The thing that wakes me up in the middle of the night is not what might happen to the economy or what our competitors might do next; it is worrying about whether we have the leadership capacity and talent to implement the new and more complex global strategies’ (2000) Management Succession Planning : Management Succession Planning Succession planning and insufficiency of capable leadership on the labour market is not peculiar to only corporate entities but akin to public and civil services. Because ‘Nobody is indispensible’ and that ‘Establishments must outlive its staff’, the search for capable people to smoothly take over from employees who would quit for reasons as retirement, lost of drive, fall out due to change, redundancy, pursue other interests, etc. Hence it is imperative that institutions must plan succession Management Succession Planning : Management Succession Planning for all roles, including that of the CEO and President’s. There are three (3) known ways of succession planning as: Do nothing, Internal and external sources. Do nothing – Some establishments prefer to do nothing and allow the system to roll on. Neither is change embraced in such establishments nor production levels of any importance. More often than not, such firms are associated with laissez-faire leadership and mediocrity is the focus. Management Succession Planning : Management Succession Planning Internal source – A good number of firms opt for internally selected individuals to step into various leadership positions. Departmental heads are tasked with identifying an individual(s) to step into their position in future. This system: encourages continuity in corporate culture, most staff have long term commitment to firm, staff intend to build career based longevity, Staff retention is high, minimal acrimony between candidates for leadership position. Management Succession Planning : Management Succession Planning The downsides to internally sourced individual(s) among others are: relatively difficult to implement change effectively, deliberate bias in selection of prospective candidate(s). Some departmental heads consciously retain the most suitable staff in he department and present the weaker one, so as to continue working with the ‘best’, high propensity of breeding xenophobia, e.g. old boyism, ethnic alignment etc. Management Succession Planning : Management Succession Planning One of the factors that encourages internal succession approach is the hierarchical organisational structure. The scheme below illustrates the rigidly defined succession path. Directors (PS 13-15) Line of Senior Management Progression (PS 8 -12) (Promotion) Middle level Management (PS 1-7) Management Succession Planning : Management Succession Planning Family business be it small-to-medium or large scale prefer leadership succession per lineage. In the Ministries (civil servicer), promotion is the normal trend for filling of vacancies including leadership positions. Annual performance appraisals purportedly serves as bases for staff to move up the scale. However with governments changing focus and implementing ‘Rolling back of the state’ concept, it becomes imperative to look for leadership outside the Ministry, Departments and Agencies (MDA). Management Succession Planning : Management Succession Planning Internal source – Process of succession. Firms that prefer internal sourcing for leadership must do well to engage an external consultant and psychologist(s) in measuring abilities of selected candidates. This would ensure the executive succession program is systematic and fair. The external consultants would be measuring candidates behaviour instead of curriculum vitae (cv) as; leadership, conflict management, team work, among others, per simulations. Management Succession Planning : Management Succession Planning The simulation exercises by the external consultant helps in the identification of needs of individual candidates as well as pointing the most suitable candidate for leadership role. Training then follows the simulations to modify behaviour for the purpose of urging candidates to achieve his or her maximum potential to the benefit of the firm and him or herself. Management Succession Planning : Management Succession Planning External source – Firms intending to implement effective change in a non-polarized working environment, so as to remain competitive, production oriented, profitable and global market expansion more often than not seeks for leader(s) from outside. With growth as a functional ingredient in today’s global industrial survival, role seems to be replacing position. This is evident in the flattened organisation structure on the next slide. A growing number of corporate bodies Management Succession Planning : Management Succession Planning Management Succession Planning : Management Succession Planning are benefiting from the flat organisational structure and so opt for poaching executives from outside (other firms). Investment banks, retain chains, air transport and even family-run businesses have joined the leadership poaching from competitors (other establishments). Competition and industrial survival is fuelling organisations to emphasis on role succession with functional profit or production targets as the reason d'état of hiring executives. Management Succession Planning : Management Succession Planning Despite the advantages of hiring executive(s) from outside for industrial change and survival, it also has some notable setbacks as; high cost, time consuming, conflict and risky. High cost – Hiring executives from outside either involves using an employment agency, professional media (magazines, newspaper, internet, etc) or poach from competitor. All these mode of hiring from outside is expensive. Management Succession Planning : Management Succession Planning Time consuming – Unlike an internal promotion into leadership role, the search for individual (s) from outside to fill in vacant role takes time, since applicants must go through multiple stages of screening for suitability. Conflict – The transition period for the new executive(s) to learn organisational culture and existing managers and staff to appreciate the new leadership direction tends to be confusing for both parties. However, it is the responsibility of the new leader to minimise the friction. Management Succession Planning : Management Succession Planning Risk – Hiring executive(s) from outside carries some level of uncertainty, most especially the lack of good knowledge of organisation culture. This is observable in market expansion by conglomerates entering new geographical locations. Here some firms’ Head office strategically prefer to acquire a competitor in the new environment as well as maintain its leadership at least for the short term, whiles they learn the operating culture for alignment into mainstream. Management Succession Planning : Management Succession Planning Much as there is no single most suitable approach of management succession planning, however industries must ensure they have a well defined procedure, else they would lose their favourable market position, reduced clientele base, lower profits, loss of innovative staff and possibly extinction. Management Succession Planning : Management Succession Planning References Australia Public Services (2003) Managing Succession in the Australian Public Services Available from http://docs.google.com/viewer?a=v&q=cache:a1My3KFN0u4J:www.apsc.gov.au/publications03/managingsuccession.pdf+managing+succession+australia&hl=en&gl=uk&sig=AHIEtbQjpVSA7XkDlR23gHMEyukNrq0W-Q [Accessed 2 December 2009] Byham, W. (2001) Taking Your Succession Management plan into the 21st Century Development Dimension International Inc. USA Cannell, M. (2009), Succession Planning Available from http://www.cipd.co.uk/subjects/hrpract/general/successplan.htm [Accessed 2 December 2009] Hirsh, W. (2000) Succession planning demystified. Brighton: Institute for Employment Studies. Management Succession Planning : Management Succession Planning Thank you

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