Many things could impact a company’s organizational structure. A key employee leaving could be devastating. It is important to have a plan in place for these situations so your business can continue without hitch.
Executive Director, Center for Manufacturing Systems, New Jersey Institute of Technology
Companies rarely give thought to things that could impact their organizational structure, such as a key person leaving. For the most part, companies have insufficient plans for this. When a person does leave, companies are forced into “scramble mode” as they try to replace that person quickly.
This scrambling can be avoided, or at least lessened, if a company develops a succession plan. Such a plan does not need to be complicated. In fact, it can be quite informal. It does, however, need to be completed sooner rather than later. In its basic format, the succession plan identifies the key positions in the organization, the people in those positions and the candidates who could replace them. The idea that “every person needs to have a backup” drives all succession plans. With a plan in place, a designated backup employee can begin to learn key aspects of a job by filling in whenever the person holding that job is out of the office.
Companies of every size can benefit from developing a succession plan. A simple format for such a plan is a chart that shows the key positions, the incumbents and the replacements for those incumbents. Thought needs to be given to whether the replacement is permanent, temporary or a stop-gap measure. In some cases, a temporary replacement may prove to be a permanent replacement after a trial period. This trial period gives the employee a chance to do the job and see if he or she has the requisite skills to be successful.
A sample succession plan chart appears below.
CNC Setup Leader
A key objective of this type of chart is to get the “permanent” boxes filled with qualified candidates as quickly as possible. The “temporary” boxes are useful in the interim, but identifying the permanent replacements really drives an effective succession plan.
Again, using the example chart above, notice that four key positions have clear backups for the incumbents. The plant manager, Ed, can be replaced by Mary. The CNC programmer, Luis, can be replaced by Ken. The quality manager, Jane, has a qualified backup in Sue. Finally, the maintenance manager, Dev, can be replaced by Ron.
In each of these cases, there should be a smooth transition with minimal disruption to the organization if the incumbent leaves the company. However, some of the other positions shown on the chart are not as clear-cut. The CNC supervisor, Mary (previously mentioned as the replacement for Ed, the plant manager), has no permanent replacement identified at this time. Don is shown as someone would could serve as a temporary fill-in and assume Mary’s responsibilities until a permanent replacement is found. However, this shows that further effort will be required to find that permanent replacement. Likewise, the CMM programmer, John, has no permanent replacement designated. Felix is a temporary replacement until a permanent one can be found. This, once again, is a cause for concern.
The final position left to discuss on the chart, CNC setup leader (Tom), shows Mel as the long-term replacement. However, there may be a delay in Mel’s availability to assume the position, so Kathy could be the temporary replacement.
The chart is just a tool to help visualize the succession plan. In some cases, such as the situation with the plant manager, Ed, and the CNC supervisor, Mary, one person leaving a company can set off a series of organizational changes. However, it is better to plan ahead for such changes and thereby maintain control of the organization.
A succession plan can help to manage change by forcing companies to think beyond the here and now. This alone can make development of a succession plan a good investment of time and effort.
As no one can be relied upon to be forever loyal to any organization, nor immortal, a succession plan should be an essential component of any company.