While a company should some kind of succession planning process, "the bigger issue is whether thecompany is committed to being a learning organization," says Tim Orellano, of the Human ResourcesTeam in Little Rock, Ark. Orellano is coauthor of a Society for Human Resource Management whitepaper on succession planning.
"How does that play into succession planning? It allows you recruit and retain people," he says.Succession planning requires "a learning organization that is cross functional, that allows you to learnhow to move up or move over."
Moving over is important because in today's flatter organizations there are only so many rungs to thetop of the ladder. It's important that employees and potential employees be able to see growthopportunities integrated within the flatter company structure.
As a part of the learning experience, Orellano urges companies to have mentors or "internal coaches."These may be executives from other areas in the company than the employees they mentor.
That's important because it's good to move candidates for leadership positions through different areasof the organization, he says. "Have someone go from HR to retail. That's how to develop people -- putthem in an area where they have no expertise. Allow people to learn about the business, so linkageis stronger and they say, 'I'm going to hang around this place. I'm being viewed as a business partner."
Moving people around means allowing them to make mistakes, he adds. "To get the experience, youalmost have to set up the opportunity for people to take risks and make mistakes. The value of makingmistakes is that you learn some things. But you have to support them. You don't want to set people upfor failure. They can't be scared or they won't push the envelope."
The profile of a good learning organization that helps employees advance is one that is open,innovative, and a risk taker, Orellano says.
These progressive and aggressive companies "keep raising the bar. They provide the fertilizer ofsuccession planning because new opportunities are being created all the time. They say, 'This is takingoff, we need somebody to step in there," he says.
To succeed at succession planning, Orellano recommends:
Have a program in place in which people can cultivate an interest in moving up in -- or across -- the company.
Have a system of observing the performance of individuals to identify who has the leadership, initiative, skills, knowledge, and ability to be considered for advancement.
Put potential candidates on special project teams to give them opportunities to work outside their traditional areas of expertise.
"Some people don't want to formalize their succession planning process. There's nothing necessarily wrong with that. Things changequickly," and an informal process may work better, he says. "The important element is that the company has a real emphasis onlearning. If that doesn't exist, I don't think you can have any kind of program because people just aren't going to stay. You're notfulfilling their personal goals."