You don’t have to look far to see the effects insufficient succession planning can have on a business. It is well documented the turmoil recently faced by the British arm of Spanish bank, Santander. Issues within the company’s organisational structure arose after the unexpected death of the bank’s Chairman; and so while a succession plan was in place to find the successor to this role, succession planning had failed to fill the void of the subsequent vacancy.
Unfortunately this isn’t an uncommon occurrence within business. Often business leaders lack the foresight to utilise complete succession planning processes which don’t just consider natural succession and exit planning, but which also encompass future hiring strategies and the training and development of existing employees.
Whilst there is a need for continual succession planning throughout everyday business life, now more than ever the vital role succession planning holds on future business growth is apparent. Across the UK, we are currently witnessing a much publicised skills shortage. This is affecting the UK economy but also holds direct implications on the manufacturing sector, which is currently experiencing a shortage of skilled applicants applying for advanced engineering positions; despite the recent growth felt across the industry. In fact, the skills shortage has become a serious concern for the engineering sector, which will need one million more workers by 2020 in order to replace those retiring or leaving . Succession planning, I believe can help resolve the ongoing skills shortage in the manufacturing and engineering sectors.
Business owners in these industries need to invest in succession planning processes in order to overcome the skills shortage and aid future business growth.
Utilising complete succession planning processes and considering future hiring, training and development will give businesses a greater view of their existing assets and requirements following a change in personnel. Continual succession planning will allow manufacturing firms to identify potential strengths across their workforce which can then be upskilled gradually, ahead of a more senior position becoming available.
Succession planning is crucial to identifying key areas of opportunity for existing employees and for the business as a whole. These opportunities can then be developed over time, using training and development techniques to prepare for the future needs of the company.
Now more than ever I would encourage business owners within the manufacturing industry to adopt a continuous cycle of succession planning in order to develop a resilient board able to sustain future growth.
I am a firm advocate in the use of continued succession planning, and if used effectively, this can benefit every member of a workforce, from the bottom up. The ongoing strength, stability and success of a business is dependent on business owners having an overall view at all times of key roles and responsibilities, and ensuring that there is always someone capable of filling a role. Continuous succession planning affords leaders the foresight to anticipate areas of growth, but also future challenges which may impact upon the running of the business.
An effective succession plan is vital to achieve this and can proactively avoid gaps and vulnerabilities which could undermine company profile, performance and results. It allows natural exits brought about by such things as retirement, to be a planned for, with minimal disruptions for everyone involved in the business. An effective succession plan also benefits those who are joining the business, either as a promotion, or equally, as a new employee. They provide successors with key skills and understanding of new roles in time for them to confidently step into their new position. Together with clear objective a comprehensive succession plan can ensure business owners within the manufacturing industry can put into place processes that will minimalise the effect the current skills shortage will have on them. Can your business afford not to have one in place?