Imagine a district manager leaves on short notice to join a competitor. How should the company respond? It’s likely the organization doesn’t have a succession plan in place for this level of employee. So, after considering the obvious internal candidates, talent leaders likely will recruit an external candidate, and the new candidate will face a long ramp-up time as he or she creates the necessary relationships, gets up to speed with the organizational culture and learns the ins and outs of the new role.

In addition to the time and cost of a new employee, talent managers will have lost an opportunity to reward and motivate existing employees by showing a commitment to employee development and providing a career trajectory for good performers. With appropriate planning and by leveraging new collaborative Web 2.0 and social networking technologies, deepening bench strength is not only more doable today — the process can become self-organizing.

Filling the Pipeline Gaps

Losing a midlevel manager or key individual contributor occurs frequently in organizations and illustrates the basic challenge many companies have with succession planning. Succession planning efforts focused too narrowly at the top fail to address talent needs for other professional-level employees. But emerging trends — most notably retiring baby boomers being replaced with a younger, less experienced generation that is also smaller in number — require more complete succession planning strategies and processes throughout the organization. Further, consider what some companies face in the post-recession rebound. According to a 2009 Academy of Management Journal article, “After a round of ‘involuntary’ layoffs, ‘voluntary’ attrition spikes by as much as 31 percent, and precisely the wrong people — those who have the strongest track records and brightest employment prospects — are most likely to leave.”

Succession planning is becoming increasingly critical for the ongoing success and stability of any organization. It helps business leaders understand what positions need attention and who is ready and willing to fill the need.