Succession planning: What it is, benefits & best practices

Succession planning is the process of identifying business-critical roles and developing employees with the potential to take on those responsibilities in the future. It helps organisations prepare for workforce changes, protect important skills and knowledge, and build a pipeline of people who can step into critical roles when needed.

Think about a vital system or process that only one person in your organisation fully understands. They’re the person everyone turns to when there’s a problem or a difficult decision needs to be made. If they suddenly leave, that knowledge and experience can leave with them. Succession planning helps identify these risks before they become a problem.

And it isn’t just about replacing senior leaders. Critical knowledge and skills can exist throughout an organisation, so effective succession planning should look beyond the leadership team and consider where losing a key person could have a significant impact. 

Succession planning helps you prepare for change rather than react to it. By identifying critical roles and potential skills gaps early, you minimise disruption and give potential successors time to build the experience and capabilities they need.

Yet many organisations remain unprepared. Research from SHRM found that 56% of HR professionals surveyed said their organisation didn't have a succession plan in place, while only 21% reported having a formal plan.

Effective succession planning gives HR and business leaders greater visibility of the talent already within the organisation. Instead of only asking who could fill a role when it becomes vacant, you can consider the people and skills you'll need in the future and start developing them today.

This makes succession planning an important part of a wider workforce strategy, connecting business continuity with talent development, career progression, and long-term workforce needs. 

Key benefits of succession planning include:  

Protect business continuity

When critical knowledge or expertise sits with a small number of people, their departure will have a big impact. Succession planning helps identify these dependencies and prepares other employees to take on important responsibilities, supporting a smoother transition when roles become vacant.

Retain and engage talented employees

Employees are more likely to see a future within an organisation when they have meaningful opportunities to develop and progress. Connecting succession planning with career development can show people which skills and experiences they need to build to take the next step in their careers.

Develop the skills your organisation needs

Succession planning can reveal gaps between the capabilities you have today and those you'll need in the future. This gives you an opportunity to target learning and development towards genuine skills gaps and prepare employees for changing business needs.

Build stronger internal talent pipelines

Relying solely on external recruitment for critical roles can leave you exposed when vacancies arise. Developing a pool of potential successors gives you more options and helps ensure valuable knowledge and experience can be retained within the organisation.

Support strategic workforce planning

Succession planning provides greater visibility of where future workforce risks may exist. By understanding critical roles, existing capabilities and potential skills gaps, HR leaders can make succession part of broader workforce planning rather than treating each vacancy as an isolated problem.

Create clearer career development opportunities

Succession planning isn't only valuable to the people who eventually move into a particular role. Identifying potential career paths and development needs can create opportunities for employees to broaden their skills, gain new experiences and prepare for future progression. 

Succession planning and replacement planning both help organisations prepare for workforce changes, but they have different purposes.

Replacement planning:

• Focuses on who could fill a specific role if it becomes vacant.
• Typically addresses an immediate or short-term need.
• May identify a single replacement for an existing employee.
• Concentrates primarily on maintaining continuity in the current role.

Succession planning:

• Takes a longer-term view of the people and capabilities your organisation will need.
• Identifies and develops a pipeline of potential successors rather than relying on one individual.
• Connects future roles with skills, potential, career development and learning.
• Evolves alongside changing business and workforce requirements.

In simple terms, replacement planning asks: “Who could fill this role?” while succession planning goes further by asking: “What capabilities will we need in the future, who has the potential to provide them, and how can we prepare those people now?” 

Every organisation is different, so there’s no single approach to succession planning that will work for everyone. Your process should reflect your business priorities, workforce and future skills needs.

However, these five stages provide a useful framework for building and maintaining your succession plan.

1. Lay out the strategy

Start by defining what you want your succession plan to achieve. Identify the roles and capabilities that are most critical to your organisation and consider where losing an employee could create significant gaps in skills, knowledge or leadership

Don't limit this exercise to senior positions. A specialist or operational role can be just as business-critical if the knowledge or skills involved are difficult to replace.

You should also define what each critical role will require in the future, rather than simply looking at the skills of the person doing the job today. Set clear objectives, responsibilities and measures of success so you can assess whether your approach is working.

2. Trial it

You don't necessarily need to implement succession planning across the entire organisation at once. Starting with a particular department, business area or group of critical roles can help you test your approach before scaling it.

Use this opportunity to identify any gaps in your process. Do you have the workforce information you need? Are managers assessing people consistently? Can you clearly identify the skills required for critical roles? The answers can help you refine your approach before applying it more widely.

3. What are you working with?

Once you've identified your critical roles, look at the talent and capabilities already within your organisation. Consider employees' skills, experience, performance, potential and career aspirations to identify people who could take on greater responsibility in the future.

Avoid relying on a single named successor. Building a wider pool of potential successors gives you greater flexibility if circumstances change.

Next, compare the capabilities of potential successors with the requirements of the role. Someone may be ready to step up now, need further development, or have longer-term potential. Understanding these gaps helps you decide where development should be focused.

As your organisation grows, maintaining this visibility across multiple roles and employees can become increasingly complex. Succession planning software can help you bring together the information needed to identify potential successors and understand where skills gaps exist.

4. Bring in learning and development (L&D)

Identifying a potential successor isn't the same as preparing them for the role. Once you've identified capability gaps, use learning and development to help employees build the skills and experience they need.

Depending on the individual and role, development could include:

• Coaching or mentoring
• Formal training and learning
• Job shadowing
• Stretch assignments
• Cross-functional projects
• Leadership or management experience

Development should reflect both the future needs of the organisation and, where possible, the employee's own career ambitions. This helps make succession planning part of meaningful career development rather than simply an internal replacement exercise.

5. Assess

Succession planning should be an ongoing cycle rather than a plan you create once and leave untouched. Regularly review whether you have sufficient coverage for critical roles, how potential successors are developing, and whether their readiness has changed.

You should also revisit the roles themselves. New technology, changing business priorities and evolving skills requirements can all affect what a critical role needs. Use what you learn to update your succession strategy, development priorities and talent pipeline over time. 

Succession planning can be a valuable tool for supporting diversity and inclusion, helping organisations build more diverse talent pipelines for the future. But it can also reinforce existing inequalities if potential successors are identified through inconsistent or subjective processes.

For example, relying heavily on informal manager recommendations can mean some employees are more visible than others. Existing assumptions about what a future leader or specialist should look like can also result in talented people being overlooked.

To build inclusion into succession planning:

• Use consistent criteria when assessing the skills, experience and potential of employees.
• Look beyond the most visible or obvious candidates when identifying potential successors.
• Review whether succession pipelines represent talent from across your organisation.
• Make career development and learning opportunities accessible to as many employees as possible.
• Combine workforce data with informed human judgement to help identify potential that may otherwise be overlooked.

It's also important to consider whether employees have equal access to the development opportunities needed to progress.  

For example, if important training routinely takes place outside working hours, could employees with caring responsibilities find it more difficult to participate? 

An effective succession strategy needs to evolve alongside your organisation. Following these best practices can help you build a stronger talent pipeline and avoid creating new workforce risks.

Look beyond senior leadership

Succession planning is often associated with executives and senior leaders, but critical roles can exist throughout an organisation. Consider where the loss of specialist knowledge, technical expertise, important relationships or operational experience could have a significant impact, regardless of seniority.

Build a talent pipeline, not a single replacement

Avoid relying on one person as the successor for a critical role. Their career ambitions may change, they may leave the organisation, or they may not be ready when the vacancy arises.

Developing a broader pool of talent gives you more options. You should also consider the knock-on effect of internal progression: if an employee moves into a new position, who could take on the responsibilities they leave behind?

Use consistent criteria

Define the skills, experience and capabilities required for critical roles and use these criteria when considering potential successors. This can make decisions more consistent and help prevent succession planning from becoming overly dependent on individual managers' opinions.

Remember to consider what the role will require in the future, rather than simply looking for someone who closely resembles the current role holder.

Be transparent about development opportunities

Succession planning doesn't mean promising an employee a particular future position. Business needs and individual circumstances can change, so guarantees can create unrealistic expectations.

Instead, give employees visibility of career opportunities and the skills and experience they need to progress. This allows people to take a more active role in their development while keeping your succession plans flexible.

Keep succession plans up to date

Your succession plan shouldn't be a static document. Employees leave, develop new skills and change their career goals, while roles and organisational priorities evolve too.

Review your plans regularly and when significant workforce or business changes occur. This helps ensure your decisions are based on the people, skills and requirements you have today – and those you're likely to need tomorrow.

As succession planning grows across different teams, roles and locations, keeping track of potential successors and their development can become increasingly complex. Relying on spreadsheets or disconnected systems can make it difficult to build a clear, up-to-date picture of your succession pipeline.

Succession planning software can bring the information you need into one place, helping you:

• Identify potential successors for critical roles
• Compare employees' skills and capabilities with role requirements
• Highlight skills gaps and development needs
• Track goals and development towards future opportunities
• Give managers greater visibility when making succession decisions

By connecting succession planning with your wider people data, you can move beyond simply naming possible replacements and take a more structured approach to building future capability. 

Effective succession planning starts with understanding your people: the skills they have today, their potential, and the development they need to take on future opportunities.

With People First, you can bring these insights together to identify potential successors, understand skills gaps and support employee development – helping you build a stronger talent pipeline and prepare your organisation for what comes next.

Ready to strengthen your succession strategy? Discover succession planning with People First.