How to Measure Progress in Succession Planning

Succession Planning Step 6: Evaluate the Success of your Succession Management

Succession management strategies aim to identify the next generation of leaders in your organization. Leaders who have the potential to fill key roles when the current personnel move on and, as a result, minimize the effect these inevitable changes have on business operations.

If you’ve been following our six-step succession planning process, you’ve already identified the critical roles to include in your succession plan, built a success profile for your critical role, nominated succession candidates to fill critical roles, and built a succession bench of future leaders. You’ve also assessed your succession candidates’ development needs and are working on the ongoing process of developing the talent in your succession pipeline.

A very important piece of any succession process is measuring and communicating progress. Unfortunately, this is something that very few organizations do—even those with a seemingly mature process.

Like any human resources initiative, it is critical to demonstrate the value of your succession plan on an ongoing basis. This will make it easier to justify your budget, to ask for a budget increase and, perhaps even more importantly, to ask for executives’ time. Often, to get attention from the leadership team, you need to demonstrate value to them on an individual basis as well as to the organization.

How to Measure the Impact of your Succession Plan

Step 1: Use Metrics to Measure Success That Reflect Your Company Goals

The success of your plan will depend heavily on the measures you focus your attention on. The metrics you choose should reflect the goals of your succession plan, so be sure these are clearly defined and stated as part of your formal succession plan. There are two kinds of metrics you might consider when you evaluate the impact of your succession planning process:

Objective Metrics for Quantitative Measurement

Objective measures are those metrics you can put hard numbers to. These are often very compelling to various stakeholders, especially executive boards or investors. For instance, some of the most common examples include the percentage of positions you are able to fill internally or the number of years it takes for the average candidate to be ready for a new role. These are often the targets of succession goals and are generally reflected in your bottom line. Look to the data you already collect on hiring, promotions, and personnel retention for some ideas on where to get started.

Subjective Metrics for Qualitative Measurement

Subjective metrics are based on less easily-defined measures of success. They are often reflective of the way succession planning impacts employees and your company’s culture on a day-to-day basis. For example, some of the most common metrics include employee engagement and job satisfaction. Many companies already conduct engagement and satisfaction surveys, and these are a great source of data. You might also consider trying to evaluate how succession impacts your employees directly, including their personal development and the quality of the relationships they have with their leaders as a result of regular development conversations.

Regardless of the measures you choose, we recommend you decide early in the process and gather baseline data so you can see the true impact succession planning has on your company. Use our Talent Progress Scorecard to help guide your measurement.

impact of succession planning
Common Succession Planning Metrics

Note, the metrics included on this scorecard are commonly used measures, but they should be considered suggestions. Companies can and should customize their metrics to fit their needs. Above all, be sure to include a balance of objective and subjective measures to gain a more comprehensive picture of your success. Common succession planning metrics include:

  • Critical Positions Filled Internally and Management Positions Filled Internally. These two measures obviously go hand-in-hand. And if you have the data, look for ways to incorporate costs into the scorecard. For example, if you know how much it costs to hire a manager externally (hiring costs, training costs, etc.), communicate this. It is certainly compelling to show that you are increasing your internal hires on a percentage basis; however, your process will have dramatically more credibility if it is attached to an actual dollar value of savings.
  • Average Time High-Potentials are in Same Role and High-Potential Turnover.You may be surprised to learn that these two measures are highly correlated to each other. Why? Your high-potential employees are typically more driven individuals. And while that means you will get more from them, it also means that they will demand more from you. Generally speaking, if high potentials are in a role for too long (the definition of a “long” timeframe can vary depending on the individual, company, and industry), they will start to look for another organization that will provide them with more opportunity for movement. If you notice your high-potential personnel tend to be in the same role for a long time, you will typically see a similar trend in high potentials leaving the organization. Once again, showing savings from a successful reduction in turnover will help you demonstrate value.
  • Critical Positions with 3+ Successors.This metric may be the simplest measure of the health of your succession initiatives. Ideally, you want to have at least three Level A candidates for each critical role—successors that are ready to move into the position, or who will be ready very soon. While this may seem like a daunting goal, it is important to take a long-term view. Start small and make demonstrable progress for a few positions, rather than trying to plan for every role at once. This is also a great measure of the effectiveness of your leadership development programs. A successful development program will show candidates progressing steadily up the readiness levels.
  • Average Years till Ready.This is closely related to the metric above. Over time, you want to see this number decline, indicating that more candidates are closer to Level A readiness to step into their future role. Although a younger organization may initially trend on the high side (more than 5 years till ready) due to the makeup of your team, over time you should be working to decrease that average. This will demonstrate both increased preparedness for personnel changes in your organization, and successful implementation of your development program.

Step 2: Update Your Talent Progress Scorecard

The Talent Progress Scorecard should be updated regularly. Succession planning is a long-term process, which means it can have a long-term positive impact. It’s not enough to review a metric or two once and consider your plan a success or a failure. Schedule time in your calendar every six months to gather and summarize the data on your scorecard. Remember that the on-going talent development and employee growth inherent in a robust succession plan takes time, so you will be seeing the benefits of succession for years to come.

Step 3: Communicate The Results

Given that succession planning requires the engagement and efforts of employees at all levels of the organization, it’s important that the results of the process are shared widely. Communicating your results, regardless of what they say, demonstrates your commitment to succession planning and signals to your employees that it remains a priority for your company. Finally, consider distributing the numbers to your management team, executive board, investors, and employees alike.

Make Measuring and Communicating a Mandatory Part of Succession Planning

Tracking measurable progress indicators and regularly sharing the results with key stakeholders demonstrates the value of your succession plan and keeps its importance top of mind. When you’re just starting out, you might not like all the numbers, but if you set and communicate reasonable expectations from the beginning, you’ll be able to show year-over-year progress in time.

Get started today by looking at what you can easily measure now and begin gathering those numbers.  Set a calendar reminder to review, compare, and communicate progress every six months. Even if you only track one metric, get in the habit of recording it, attaching a dollar value if possible, and conveying that to your stakeholders.

Measuring and communicating early and often will ensure that you get the executive commitment and resources you need for a successful succession planning initiative.


SIMPLE Succession Planning Certification

Talk to Glen.

If you’re interested in learning more about SIGMA’s succession planning services, Glen is the guy for you. He knows our material inside and out, and can tell you first-hand stories of the work we’ve done with our clients. And just so you know, Glen doesn’t do sales – he does solutions. That might mean answering your questions, giving you our best tips and tricks, or pointing you to our FREE resources. Send him an email or give him a call! He’d love to chat with you.

[i]Time for a more holistic approach to talent risk. KPMG International. 2013

About the Author

Glen Harrison

Vice President

Glen oversees SIGMA’s sales and marketing activities. As a skilled presenter and trainer, he has designed and delivered engaging and entertaining workshops and webinars to help leaders and HR professionals enhance their understanding of how our products and services can be used to realize potential within their organizations.