We’re in the middle of a labor shortage. It doesn’t matter what industry you’re in, there just aren’t enough workers replacing those who are retiring.
So how do you gain and retain the talent your business needs during this labor shortage and into the future? You could respond a multitude of ways:
- Recruit increasingly hard-to-find and expensive people outside of your organization.
- Keep doing what you’re currently doing and potentially experience a competitive decline.
- Develop the high-quality people already in your organization and grow your future leaders from the inside.
This third option is ideal, but it’s not the strategy that organizations automatically consider. The tendency is more towards the unstructured, reactive method of replacement planning over the structured, proactive method of succession planning. But replacement planning likely won’t bring success in the long-term.
What is succession planning?
Succession planning is an integrated set of processes within your overall talent management system that identifies and prepares mission-critical employees for the mission-critical key roles needed to deliver your organization’s strategy.
There are three processes involved: talent assessment, the actual succession planning portion, and development planning.
We’re going to dive into the talent assessment process today.
What is talent assessment?
Talent assessment is the process of identifying high-potential employees and evaluating their skills and competencies. This prepares them to advance into positions that are key to the success of your organization’s strategy.
Assessing your talent delivers significant benefits. You can avoid (or at least reduce) extended and costly vacancies in key positions, as well as improve the stability of your operations. Replacement planning, on the other hand, means you only start looking to fill the position once it’s already vacant.
Assessing talent also provides development opportunities for your employees, which increases your chances of retaining those with high potential. High-quality employees who aren’t given development opportunities will leave your organization eventually. Determining who those employees are and what their skills and competencies are allows you to develop a deep and diverse bench of talent for current and future business needs, while having more peace of mind that those employees will likely stay with your organization over the long-term.
Preparing for a talent assessment
Getting to the talent assessment portion of succession planning involves some preparation, though. You first have to review your strategic plan, identify mission-critical positions in your organization, and identify key emerging positions.
Next, you have to define the critical experience, skills and competencies for these positions and then develop comprehensive job descriptions.
Finally, you have to evaluate the current demographics of your organization for each key position. Only then can you conduct a talent assessment of your current talent and identify mission-critical employees and those who will be considered candidates for succession into higher-level roles and responsibilities.
The dimensions of a talent assessment
There are different dimensions of talent to take into account, too. First, there’s performance. It’s an employee’s track record of success — how they’ve delivered on goals, results and accountabilities.
Look at their most recent performance review ratings, as well as feedback from others. Try to get as much feedback as possible — a full 360-degree view of that employee (e.g., boss, peers, subordinates, and maybe even customers or vendors). Consider also their stretch goals and contributions.
When assessing performance, ask questions like:
- Does this person have a proven track record for accomplishing impressive results?
- Are there any potential inconsistencies?
- Are they already performing at the next level?
The second dimension is potential. This is the employee’s ability to adapt to and “fit” into increasingly complex roles and environments.
Assessing potential is multifaceted, and you should prioritize the ones you want to evaluate. These include values, competencies, energy and drive, relationship building, influence, etc. Consider also their personal and professional motivation, intellectual curiosity, innovation and insight, engagement and determination.
It’s always going to be a judgment call, but you can minimize your subjectivity through comprehensive involvement and a structured approach. The more evidential experience, the better your judgment will be.
When assessing potential, ask questions like:
- How does this person respond to obstacles?
- Does this person inspire others and lead through persuasion and influence?
- How do unexpected changes affect this person’s performance?
- Does this person have initiative and seek additional responsibility?
- Does this person continually offer solutions and new ideas?
Below is a talent assessment matrix that can help you plot out where employees are on the development and potential scale. This is commonly known as a “9 box” exercise. It should be conducted periodically by senior management to review employee performance and assess their potential for taking on more responsibility and/or leadership roles. Working with a facilitator often enhances the reliability of the results.
Are you ready to pinpoint and develop future leaders in your organization? Wipfli can help you optimize talent, plan the succession of key roles, and make sure your culture aligns with your organizational strategy.
Get to know more about our talent and change solutions, or continue reading on:
Align performance management and compensation systems
Succession planning: A critical talent retention strategy
HR strategy: Create a proactive people-plan that speaks to your leaders’ real goals