The Issues Involved in Succession Planning - Research Proposal Example

SUCCESSION PLANNING DISSERTATION PROPOSAL If organizations put off or ignore succession planning, can this have catastrophic consequences when the existing talent pool lacks the individuals with the appropriate skills and competencies to successfully compete in the increasingly dynamic world of business? SUCCESSION PLANNING INTRODUCTION Organisational survival and growth are the most important responsibilities of top management of all organisations. Consequently, planning management succession becomes prime requirement to ensure right number and right kind of management staff at the right time and in right positions for continued organisational vitality and strength. In simple terms, succession planning is an organisational process of pinpointing or selecting certain competent people as successors for key executive appointments like CEO, CMD etc. after expiry of terms of their current occupants and proactively planning their career moves in that direction. This process is straightforward in a family business where the heirs are obvious and well known. However, in other organisations, succession planning is required to be logical and well thought out management process in short and long terms requiring considerable effort towards grooming an individual for an extended period to take on the top job. This is the only tool we have today which sanctions the organisation to plan well-tailored and proactive career moves for their most talented pool of future managers. (Hirsh, 2000) However, if such succession planning is put off or ignored by the top management, the consequences can be catastrophic. This is especially so if the existing talent pool lacks competencies to take on challenges of a modern business world and there is no suitable candidate available from outside the organisation to take on the top job. Consequently, opinions vary considerably on whether succession plans should involve selection of existing talents within the organisation as discussed by Groves, Biggs (2004), Blackler & Kennedy (2004) and Cogner and Fulmer (2003) or top jobs should be handled by tapping talents from the outside market. While selecting employees from within the organisation has its own benefits like better motivation, higher integrity, reinforcement of management’s faith in employers, good in-depth knowledge of strengths and weaknesses of the organisation and support from within due to familiar face at the top, but it is true that sometimes familiarity breeds contempt. In addition, there is possibility of previous conflicts with some good performers complicating or inflating into serious differences of opinions or rivalries. Nevertheless, it can be safely stated that succession planning is an important course of action at senior levels failing which an organisation can face tremendous difficulties in the event of a sudden requirement to replace top executive. Further, once the successor is selected, the most important phase of his career planning or grooming for handling things at the highest level begins. Most family owned businesses lack in this professionally oriented grooming and training due to inherent complacencies of an assured future, which sometimes leads to complications due to personal rather than a proficient outlook. In extreme cases, this has even resulted in splitting up of large businesses into smaller units due to family feuds, sibling rivalries, and mutual disagreements over leadership and ownership aspects. In honest opinion of this author, such unpleasant dissections and associated negative publicities could have been avoided simply through proper succession grooming. Sadly, the lessons are never learnt and succession training to develop right competencies has never been given due importance. One aspect inhibiting proactive approach may be due to perceived and misplaced feeling of indispensability among the top management. The succession planning overcomes this very indispensability of an individual. Everyone becomes dispensable then. These conflicting perceptions can also lead to serious predicament for companies if a successor is required urgently and his appropriate grooming has not been carried out. Literature on the subject also brings out such drawbacks, and many others. Bobbin P (1996) in his book ‘Succession: No Will No Way,’ ‘More Jobs for Boys’ by Martin Lynn (2000) and ‘Women in Management Review: 2001’ bring out such drawbacks where talent pool has been greatly wasted essentially due to wrong perceptions, gender based perceptual inequalities, inadequate grooming and lack of proactive action by the top executives. Furthermore, there is one inherent limitation of most appraisal systems across the spectrum. Appraisal of current job performance forms the backbone of the report. His potential to perform in future normally gets only a cursory glance. Unfortunately, his future potential is more important for an organisation than his current or past performance. If accurate recognition of potential performers can be made, they could be groomed suitably to lead the organisation at a future date rather than losing them out to some other organisations. One clear example in this regard is the military, where a good performer is recognised at an early date, and thereafter rotated in important posts to accumulate sufficient experience in varying fields such that he can lead the organisation with confidence at a future date. The literature also points at inadequate exposure and lack of awareness of top executives in latest innovations of management techniques as contributing factors for such inappropriate perceptions. One such new field is Management Development. Management Development is slowly assuming far more critical role with each passing decade. It is a process of OD or organisational development where managers learn and sharpen their skills to improve themselves as humans and leaders as well as positively influence their organisations. The necessity of management development cannot be overemphasised. As we know, management is art as well as science. These dynamic fields are continuously changing, and new researches in these fields are challenging our stereotyped and traditional ways of thinking and dealing with management issues. These also have a direct bearing on long-term profitability and sustainability of our organisations. Therefore, honing skills through management development has been receiving considerable attention these days, and is likely to make many theoretical management models obsolete in time to come. This development training is also a sort of refresher course for senior managers, and training of superior and latest management skills for the middle rung. However, as with any new phenomenon, hectic schedules and persistent efforts to increase profitability of organisations have affected the real initiatives in this direction leaving management development more as theoretical models worthy of only a lip service. Considering the effect that succession planning and successor’s grooming and training has on future of a company, it is inevitable that management development is made integral to succession grooming and competency development of an organisation. PROBLEM STATEMENT This dissertation shall attempt to address the issues involved in succession planning with respect to following research questions: a. Will choosing employees based on their competencies rather than their traditional job histories enable a company to find unforeseen gems within its workforce? b. How well do businesses reinforce the importance of developing the right competencies for achieving the company’s strategic direction? c. What is the current emphasis on management development in today’s organisations and integrating competency models into the employee selection and performance management processes? METHODOLOGY Overview. Adequate literature exists as described in proposed Bibliography regarding various aspects related to Succession Planning and its impact on future of management. The various topics that shall be analysed in bringing out a justifiable and meaningful deduction include; succession planning, helping people learn, CEOs’ and HR managers’ perceptions, competitiveness, performance contrasts between family and non-family companies, gender based discriminations, best practices in succession planning, leadership, 360 degree feedback and leadership development, performance development, emerging challenges for boards of directors, leadership programs for experienced chief executives, management development, study of formative years in business, developing leadership pipeline, succession planning: no will, no way and aspects related specifically to succession planning in large corporations. Research Methodology. The data included in the bibliography shall be used as per relevance of our subject of succession planning. The following methodology is proposed to achieve the task: a. Investigate the subject matter of the selected research topic. b. Gather data about the subject matter of the selected research topic relevant in our context. c. A questionnaire survey shall be conducted to obtain views of the faculty members and students. d. Study various case studies available on internet of successful and unsuccessful succession planning across the world. e. Conduct interviews with experienced faculty members on their experiences of succession planning while in the field. f. Analyse and interpret the data collected. g. As regards development of collection and listening post instruments, they shall be developed keeping various variables related to our topic. h. Procedures for analysis shall be done through various techniques including: a. Basic information will be projected using histograms, pie charts and line graphs. b. To understand the relationships, various methods like correlation and regression methods shall be used. c. Certain case studies shall be discussed in statistical build-up of case for succession planning from within or an outsider keeping all pros and cons related to the matter on table. d. Recognising talents from within is an art which can only be achieved by incorporating certain honest appraisals of potential leaders. Various human limitations of this system and suggested remedies shall be discussed in sufficient details during structuring of this argument. e. Various innovative attempts by organisations to develop competencies of their future managers shall be discussed in details, with success rates and reasons for failures as and where applicable. f. Management development is another aspect which has not received as much importance as it deserves. The strengths and various reasons for reluctance of organisations to effectively implement management development programs shall be highlighted. g. The overall effect of all these aspects and their cumulative effect on succession planning of an organisation shall be brought out conclusively. Work Plan. The suggested tentative plan for collection of data, analyses, compilation of document and submission is given in the following chart: Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Subject matter investigation Data collection Literature Review Literature Review Questionnaire distribution Questionnaire analysis Case studies analysis Interviews with faculty members Data analysis Data analysis Document Preparation Conclusion Submission CONCLUSION The succession planning within an organisation involves considerable effort by the top executives so as to ensure that the available talent pool within an organisation is properly developed and groomed to take on responsibilities of senior management positions within an organisation. Contrasting views exist on whether an organisation should groom own talent or find professionals from the market to ensue smooth succession. Further, traditional job history or current appraisal system of a potential leader looks after only his current job performance. Recognising his/her overall competencies can throw light on his potential to perform better in the future. A good appraisal system should always work in this direction, by not only recognising his current contributions but also list out his capabilities to perform in the future and contribute to the organisation’s overall future development. Developing competencies and grooming of employees for future can ensure that well-motivated and knowledgeable individuals from within lead the organisation thereby accumulating innumerable associated benefits. While the aspect is widely recognised, it is not well implemented by most systems leading to individuals being left on their own to develop latest management techniques. This limitation can be overcome by implementing management development workshops at various levels so as to help middle and top management to hone their work skills and contribute in overall future success of the organisation. PROPOSED BIBLIOGRAPHY 1. HIRSH, W. (2000) Succession planning demystified. Brighton: Institute for Employment Studies. 2. CHARTERED INSTITUTE OF PERSONNEL AND DEVELOPMENT. (2003). Bringing policies to life: a survey of the UK and Ireland. Survey report. London: CIPD. Also available online at http://www.cipd.co.uk/surveys 3. CHARTERED INSTITUTE OF PERSONNEL AND DEVELOPMENT. (2004a). Helping people learn: a survey of the UK and Ireland. Survey report. London: CIPD. Also available online at www.cipd.co.uk/surveys. 4. CHARTERED INSTITUTE OF PERSONNEL AND DEVELOPMENT. (2004b). Reorganising for success: CEOs’ and HR managers’ perceptions. Survey report. London: CIPD. Also available online at www.cipd.co.uk/surveys. 5. PORTER, M. and KETELS, C. (2003). UK competitiveness: moving to the next stage. London: Department of Trade and Industry. Also available online at www.dti.gov.uk/publications/ [Accessed 16 November 2005]. 6. Poutziouris, P, Chittenden, F (1996), Family Businesses or Business Families?, UK Institute for Small Business Affairs in association with National Westminster Bank. 7. Westhead, P, Cowling, M (1997), "Performance contrasts between family and non-family unquoted companies in the UK’", International Journal of Entrepreneurial Behaviour and Research, Vol. 3 No.1. 8. Westhead, P, Storey, D (1997), "Research report No 26", Training Provision and Development of Small and Medium Sized Enterprises, HMSO, London . 9. Women in Management Review. Volume 16 Number 5 2001 pp. 222-231. 10. Allio, R. (2003), "Interview: Noel M. Tichy explains why the virtuous teaching cycle is integral to effective leadership", Strategy & Leadership, Vol. 31 No.5, pp.20-6. 11. Atwater, L., Waldman, D. (1998), "360 degree feedback and leadership development", Leadership Quarterly, Vol. 9 No.4, pp.423-6. 12. Baird, L., Holland, P., Deacon, S. (1999), "Learning from action: imbedding more learning into the performance fast enough to make a difference", Organizational Dynamics, Vol. 27 No.4, pp.19-32. 13. Biggs, E.L. (2004), "CEO succession planning: an emerging challenge for boards of directors", Academy of Management Executive, Vol. 18 No.1, pp.105-7. 14. Blackler, F., Kennedy, A. (2004), "The design and evaluation of a leadership program for experienced chief executives from the public sector", Management Learning, Vol. 35 No.2, pp.181-203. 15. Bray, D.W., Campbell, R.J., Grant, D.L. (1974), Formative Years in Business: A Long-Term Study, Wiley, New York, NY, AT&T Study of Managerial Lives, . 16. Burke, M., Day, R. (1986), "A cumulative study of the effectiveness of managerial training", Journal of Applied Psychology, Vol. 71 No.2, pp.232-45. 17. Kransdorff Arnold. 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