Succession planning is a vital aspect for manufacturers looking to secure their future and manage workforce changes efficiently. Retirements, resignations, and terminations are a natural and unavoidable part of any organization. But, a succession plan can make the replacement process smoother, helping to sustain business operations and reduce any unnecessary downtime.
Let’s explore what a robust succession plan is, including identifying and developing internal talent, deciding which skills and qualities are necessary for each position, and reviewing and updating the plan to stay current with industry changes. By taking these steps, a manufacturer can have a pool of qualified and prepared employees ready to take on crucial roles, leading to a successful transition for the company.
What is Succession Planning?
Succession planning is a strategic process that involves identifying potential successors for critical roles throughout a company.
Several elements have to come together to create a strong succession plan, including:
- A list of available key positions throughout the company (or positions that may become available soon — i.e., an upcoming retirement or an impending new role).
- An analysis of the current state of your company as well as projections of how your company will look over the next three to five years.
- A list of high-potential employees who can fill open roles.
- A list of positions that don’t have an obvious replacement and need a recruiting plan. For example, there might be a senior management role without a viable candidate within the company.
Why Is a Succession Plan Important in the Manufacturing Industry?
Small and medium-sized manufacturers (SMMs) have had difficulty finding and retaining talented employees over the last few years, with increased resignation rates, burnout from the pandemic, and changes in how the industry operates. A succession plan will make it easier for your manufacturing company to determine how to fill open positions.
A well-structured succession plan offers several benefits, including:
- Readiness of skilled and capable employees to take on key roles
- Lower costs associated with recruitment and training
- Minimal disruption during transitions
- Enhanced productivity through proper placement of individuals with the necessary skills, experience, and attributes
If you have a solid succession plan, you can create a vision for the future and set your organization up to compete in this fast-paced industry.
How to Get Started With Succession Planning
Getting started with succession planning can seem daunting, but with a systematic approach, it can be streamlined and effective. Here are the steps to follow:
1. Assess Company Needs
Evaluate the current structure and determine which positions are critical to its success. Identify any upcoming vacancies, such as retirements, and consider what the company will need in the future. Consider the company's goals and how each position plays a role in achieving them. This step provides a clear understanding of what is required to maintain and grow the company.
2. Map Out Necessary Skills or QualitiesTo fill positions effectively, you need to know what skills and qualities are required to do the job. When mapping these qualities out, include technical and soft skills such as leadership and communication.
3. Find Internal Candidates
Search for employees within your company who have the potential to fill key positions. Offer training and development programs to help them acquire the necessary skills and qualities. Reach out to these employees and let them know about the potential opportunity. This step can boost employee morale, reduce turnover, and provide a ready pool of candidates for critical positions.
4. Develop a Cross-Training Program
Encourage employees to gain experience in different areas through cross-training programs. This step can help build a more diverse pool of internal candidates and prepare the company for unexpected departures. Cross-training also provides employees with new skills and perspectives, making them more valuable to the company and increasing their chances for advancement. In addition, cross-training has the added benefit of providing flexibility and the capability to maintain production and quality levels when key staff are out due to illness or vacation.
5. Integrate with the Hiring Plan
Identify any critical positions that don’t have an obvious internal candidate and integrate the succession plan with the hiring plan. Inform your recruitment team of the necessary skills and qualities to look for in potential new hires. This step will ensure that the company can quickly fill critical vacancies with the right person, even if they come from outside the company.
6. Review and Revise
Regularly update your succession plan to ensure it stays current as both your company and the industry evolve. Check that the necessary skills and qualities for each position are still relevant. Make necessary adjustments to ensure your company is ready for any leadership transitions.
Maximize Your Success with CMTC's Succession Planning Services
Having a solid succession plan in place is essential for the success and stability of a manufacturing company. By following these steps, you can establish a comprehensive guide that readies your company for any future staffing changes, minimizing your risk and contributing to your continued growth and prosperity.
If you’re looking for assistance with your succession plan, look no further than CMTC! Our experts will provide resources and support to help you create, implement, and update your plan. Our goal is to work hand-in-hand with your team to secure the future success of your company.
About the Author
Gregg Profozich is a manufacturing, operations and technology executive who believes that manufacturing is the key creator of wealth in the economy and that a strong manufacturing sector is critical to our nation’s prosperity and security now, and for future generations. Across his 20-year plus career in manufacturing, operations and technology consulting, Mr. Profozich helped manufacturing companies from the Fortune 500 to the small, independents significantly improve their productivity and competitiveness.