Measure the success of your succession plan
This article is part of our series on SIGMA’s six-step succession planning process.
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.
To help you accomplish this, SIGMA uses our Talent Progress Scorecard, which measures a number of success factors, including:
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 Hi-Potentials are in Same Role and Hi-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 isclosely 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.
Make measuring and communicating mandatory
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 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.
Download SIGMA’s SIMPLE SUCCESSION TEMPLATE GUIDE to access Succession Planning Templates for each stage of your Succession Planning Process
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SIGMA’s Succession Planning Launch Series offers a simple and cost-effective way to build a robust Succession Planning process and ensure your organization’s leadership is positioned for success and prepared for the unknown.
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