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Overcoming Succession Planning challenges

Succession planning refers to the process of identifying critical positions in a company, and putting in place action plans for persons to assume such positions, when they become vacant. This involves identifying and preparing future leaders for ensuring effective business continuity, without any disruption. Such vacant positions may occur due to planned separation such as retirement, or unplanned separation such as by resignation or cessation for any reason. For business continuity, it is imperative for every company to nurture its future leaders, and to train them to fill critical roles in minimum time.


Succession plans involve critical roles such as Board level positions, top management and all other critical positions of the company. It is no longer the role of only the HR department of a company to focus on this aspect. The Nomination and Remuneration Committee of the Board also has an important role to play, especially for succession planning relating to Board of Directors and top management.


Effective succession planning has many aspects that could pose a challenge:

  • To identify and map the critical roles and positions properly, without undue focus on C-level executives alone
  • To leave the process too late
  • To not identify a potential successor
  • To not groom the potential successor properly
  • To identify only one person as a potential successor, with the risk of that person leaving before the vacancy arises
  • To not be open to either of internal candidate or hiring from outside
  • To not be open to the possibility that the role itself may undergo a change, and therefore, an identified potential successor may no longer be relevant
  • To delegate succession planning to only the HR department, with no oversight of the Nomination and Remuneration Committee
  • To fail to update and review the succession plan
  • To not plan adequately for the second best, who could be in the race as a potential successor, but might not get chosen


Some ways in which some of these problems can be resolved are:

  • Have a long-term perspective – Instead of planning succession for only C-level executives, the company should ensure that it identifies all the critical roles, both at present, and with an eye towards a 5-10 year horizon.
  • Identify the characteristics and skills required in advance – It is imperative that the company identifies the characteristics and skills required of the potential successors. This will ensure that the process focusses on finding the best person for the job.
  • Have a pool of talented high potential candidates – As an ongoing effort, the company must focus on developing internal potential successors. The choice should be broadened to external candidates, if required. Considering only internal candidates may result in shutting the door on new ideas which external candidates might have.
  • Considering both the performance and the potential of a possible successor – While shortlisting potential candidates, current performance, gaps, and potential should be considered. This would help in proper training being provided.
  • Role of Nomination and Remuneration Committee – For senior positions, the Nomination and Remuneration Committee should play a very important role. The Committee should have exposure to potential candidates, so that they can make their own assessment of the talent pipeline of the company.
  • Role of existing senior management person – It is the role of the current incumbent to not only be a part of the selection process of the potential successor, but to also help identify and groom him/her.
  • Keeping the succession plan up-to-date – Succession planning is not a one-time exercise. It is a continuous process and should be reviewed and evaluated regularly. The readiness of a potential successor to undertake new roles should be re-evaluated periodically.


Timing is the key. If the date of retirement is known, companies must definitely plan in advance for filling such vacancies. Giving last minute extensions to the current office bearer because no successor has been identified, is a suboptimal solution.


Also when date of cessation is known, as in the case of positions of Independent Directors, who have fixed tenures, the role of Nomination and Remuneration Committees should plan in advance for proper succession planning for such positions. Companies, like nature, should abhor a vacuum.


Shikha Shah