February 20, 2020
Businesses tend to purchase insurance policies in order to ensure they are prepared and protected from any external disruptions or risks outside their control. So why do most businesses overlook the importance of succession planning? The sudden departure of a senior leader or key figure can leave a business extremely vulnerable. Having a plan in place is crucial in order to minimalise the level of disruption that occurs when a significant individual leaves a business. As a result, the phrase ‘if you fail to plan, you plan to fail’ is very applicable when discussing the benefits of succession planning.
What is Succession Planning?
A succession plan is a process where an organisation identifies talent to fill the responsibilities of a role that is currently occupied but may become vacant soon. This effectively provides a ‘safety net’ for the company as by preparing a list of capable individuals for the role in question, the transition from the incumbent to the successor is likely to be smooth and efficient. Due to this, succession planning and creating a pipeline of talent for the future certainly has positive repercussions on a business and is an extremely worthwhile process. It is an effective use of time and energy, and organisations should be on the lookout for outstanding talent in order to allow for a robust leadership pipeline in the future.
Benefits of Succession Planning
According to the Pew Research Centre, approximately 10,000 baby boomers will turn 65 today – and every day – until 2030, which will ultimately place a significant strain on those in senior leadership roles. Preparing for this transition will ensure functionality and stability within organisations, alongside providing the next generation of future leaders with development opportunities and training.
Succession planning enables organisations to identify those individuals with high potential and the correct skills and experience to fulfill the responsibilities of a specific position. It is common for organisations to explore external talent in order to benchmark against its current workforce and ensure that the highest quality of talent is acquired. Eames Partnership can highlight the top talent operating across a market, showcasing individuals that not only have the expertise, but also bring diverse skillsets and fresh perspectives.
Additionally, areas of weakness within a business may be uncovered and can be dealt with in order to secure future success and financial growth. Recognising these limitations and remaining open to alternative leadership possibilities is useful in order to evaluate how each potential candidate could benefit the organisation overall. As a result, by partnering with an executive search firm to formulate a succession plan, Eames Partnership can create detailed perception analyses of each individual and their willingness to move elsewhere if the opportunity arose. Alongside this, we can create a bespoke development program for rising talent within the organisation, equipping them with the tools and coaching to progress further in their careers.
Furthermore, there is a growing talent gap in the insurance industry, particularly at the middle management level, where organisations do not have the correct individuals internally to replace executives. This has the potential to cause significant disruption, and therefore, insurance firms must plan to shrink this gap through talent pipelining. Importantly, preparing in advance ensures that businesses are ready for leadership changes and unexpected exits, enabling them to fill critical positions quickly without a lengthy hiring period. Contrary to popular opinion, succession planning proves to be useful not only when replacing those operating in C-suite positions, but also when preparing for the departure of other influential figures, including senior leaders within an organisation.