Succession planning helps companies keep things moving in a common direction no matter who's in charge. Through succession planning, future leaders are prepared to step into the shoes of current leaders. When this process is effective, company activities and strategies can continue to move smoothly forward during leadership changes. When it's not effective, the hiring process might need to look externally, bringing in leaders who don't know the company's culture and processes, potentially impacting business continuity.
The first step to measuring the effectiveness of the succession planning process is to establish key objectives. Think about what the process is expected to accomplish. Succession planning is about developing employees so they can take on bigger roles. Consider both qualitative and quantitative goals that focus on employee development. Qualitative objectives can be based on developing leadership competencies, such as communication and decision-making skills. For an example of a quantitative objective, consider measuring the number of leadership vacancies filled by internal candidates based on their readiness, compared with the number that had to be filled through external hires.
After drafting process objectives, fine tune them until they're "S.M.A.R.T." Objectives should be: Specific; Measurable; Achievable; Relevant and Time-based. Even qualitative measures can be quantified to make them both specific and measurable, such as by identifying levels of progression using 0 to 5 rating scales. For the objective to be achievable, employees entering the process should have a baseline skill set that indicates they are ready to take on greater responsibility. The objectives must also be relevant to the business at hand or to a specific leadership position or level, and there must be an end date to indicate what results are expected during a specific time-frame.
One key objective for a succession planning program should involve building a strong pool of employees who are ready for promotion. Measure the current status of the company's "bench strength" by identifying the number of leadership roles in the organization and the percentage of those roles that have a successor identified. Of those successors, determine how many are currently ready to take on the role, and how many will require additional training or experience. Set objectives to progress from the current strength of the bench to the desired strength.
Measures matter when they're made visible in reports. If they're not reported, there's no point to recording them. Since a succession planning program is about developing leaders, it needs leadership backing to be successful. Get that support by providing regular reports of valid and effective measures. One of the best measurements of a succession planning process involves identifying how many employees have advanced or are ready to advance into new leadership roles.