Nearly every client I work with is talking about succession planning and rightfully so. Businesses today are looking at two disturbing trends: The impending mass exodus of baby boomers from the workforce and the growing mismatch between the skill demands of employers and the skill supply of the workforce. Consider the following based on research conducted by the Society for Human Resource Management (SHRM) and AARP.
- It is estimated that 77 million people in the workforce will retire by 2025.
- Employers in the United States will need 30 million new college-educated workers by 2020, but fewer than 23 million people are forecast to graduate from colleges in the next ten years.
- In 2012, 56 percent of organizations with full-time job openings indicated they are having difficulty recruiting qualified applicants, despite the high unemployment rate.
- Due to a combination of boomer retirements and the mismatch in skill supply and demand, the United States may have four million more jobs than workers to fill them by 2018.
For these reasons it is important that organizations broaden succession-planning efforts beyond management positions and/or management employees only. Of course leadership succession remains critical; however, the above trends should prompt us to look at the total talent equation within our organizations.
An effective succession-planning program addresses the need for back-up players and individual development for all critical job roles in the organization. This includes professional, technical, sales, clerical, and production roles. This approach to succession planning will ensure the right people are in the right places at the right times, doing the right things to get the right results—today and in the future. In addition, this approach preserves organizational knowledge across all key positions and functions, not just leadership positions.
According to William Rothwell, professor of workforce education and development at Pennsylvania State University, implementing a broader succession planning program also:
- Contributes to the implementation of the organization’s strategic business plans.
- Identifies replacement needs as a means of targeting necessary training, employee education, and employee development.
- Increases the talent pool of promotable employees.
- Provides increased opportunities for high-potential workers.
- Taps the potential for intellectual capital in the organization.
- Helps individuals realize their career plans within the organization.
- Encourages the advancement of diverse groups.
- Improves employee morale.
- Improves employees’ ability to respond to changing environmental demands.
- Helps decide which workers can be terminated without damage to the organization.
Taking a broader approach to succession planning will be hard work and will require a solid change management plan. But considering the boomer exodus and the skills mismatch mentioned above, can we afford not to put in the effort?
What are your thoughts?
Carr, Bob, and Jean Setzfand. “Avoiding the Boomer Brain Drain.” SHRM and AARP webcast (April 10, 2012). Retrieved from http://www.shrm.org/hrdisciplines/staffingmanagement/articles/documents/041012_webcast.pdf.
Rothwell, William J. Effective Succession Planning. 4th ed. New York: AMACOM, 2010.
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