What's In It For Me? Succession Plan Benefits
CostCo recently announced that longtime CEO Craig Jelinek is retiring at the end of this year. His successor, Ron Vachris, will assume the role in January. Jelinek has been with CostCo for 40 years and Vachris, currently COO, has been there for thirty years. Jelinek and Vachris have been working hand in hand for 20 months and Jelinek will stay on in an advisory capacity until April 2024. This is a case study in how to successfully execute a succession plan.
I spoke about succession planning at a conference and when I gave the presentation, I mentioned the challenges that organizations face as they adopt new initiatives. It’s important to know how an initiative can impact an organization, too. So here are the benefits to creating a succession plan:
•Increases employee retention and reduces turnover
•Offers career advancement opportunities for employees
•Ensures stability of the organization
•Opportunities for mentorships
•Shared company values/goals get passed on
•Transfer of knowledge-not loss of knowledge when someone leaves or retires
•Build talent pool/bench-strength
•Increased morale
Increase employee retention within your organization with a solid succession plan. Employees want to know that there’s a plan in place when someone leaves. Employees want to know there’s a plan in place to ensure the stability of the organization. I’m sure that as a leader within your organization, you want to know that your company is going to be able to weather a storm, whatever that storm may be. Succession plans are one of the ways to ensure your organization weathers that storm.
A CareerAddict study released in 2020 revealed that 82% of employees would quit their jobs because of no career progression. Putting a succession plan in place is career progression. When you talk about succession planning with your employees, you show you’re committed to their career development and that your company offers career development. A big part of career development is mentoring. Mentoring programs can be formal or informal. People across all levels of the organization can be mentors or they can be mentored. As I’ve grown in my career, I found that I need mentors just as much as when I was just entering the workforce. Everyone benefits from mentoring programs.
A succession plan ensures a transfer of knowledge. When someone leaves your organization, they take their knowledge and experience with them. If you have a succession plan in place, you prepare for someone’s departure by making sure they train their successor and pass along their knowledge. A succession plan also ensures that the successor is working towards the shared goals and values of the organization with the transfer of knowledge.
As the workforce changes, and it has changed dramatically in the past three years, it’s important to build a talent pool within your organization. The average tenure of an employee has dropped in the past few years and employees are leaving organizations quicker than they have before. You may call this job-hopping. Employees are leaving to look for career opportunities in other places, maybe a jump in salary, or more meaning in their jobs. Creating a succession plan ensures that you’re building the talent within your organization. Creating more well-trained, well-rounded employees.
All of these benefits of succession planning contribute to increased morale. Employees want to know that there is career advancement. They want to know their organization can provide that career advancement. They want to know they’ll be well-trained to take on new responsibilities and new roles. Succession planning creates those career opportunities and increases morale.
Are there other benefits of succession planning that you can think of? I’d love to hear them.
Is your organization ready for a succession plan? Book a discovery call with me to discuss succession planning for your organization.
