Paving the way for future leaders

Leadership Training

Predictive analytics in succession planning

A true leader must ensure that he has a successor & must be dispensable in his role.

In my journey as a leader, I have often seen that succession planning is a very sensitive subject. The best of leaders have struggled with this. Often insecurities, lack of self-confidence, fear of the unknown, family commitments etc, contribute to people wanting to hold on to their jobs and don’t often worry about succession planning for themselves. It’s not always easy to care about the organization and think about the larger picture when you feel insecure.

From an organization perspective, if you do not have a proper succession plan, any sudden exit, termination or non-performance will create a complete chaos. Therefore, Succession planning is vitally important in any organisation. We have enough information on how we use predictive analytics in marketing, education, manufacturing, insurance, banking and more.  

Did you know that we can use predictive analytics in creating human capital as well?

It is crucial to understand who is next in line to fill senior positions and also to be able to groom these executives in such a way that they become the next generation of successful leaders in your company and thereby you stay competitive.

The Target

When we talk about succession planning, we are referring to critical roles. For example, an entry level accounts executive is easy to replace, but the Head of Accounts may not be.  Again, when we talk about successors, we need to pick and evolve those that are the most eligible of the lot. I have always leaned towards growing my team internally as this makes it aspirational for employees and helps them grow within the organization. Having said that, there are times when I have also felt that home grown talent may not necessarily always have the exposure and talent to fill all the positions within the company.

So, while we mostly look at internal candidates, there are instances where external ones are brought in as well. The ultimate purpose of succession planning is of course to ensure continuity…when people leave, there has to be qualified individuals to take over their roles seamlessly.

Predictive Analytics

We generally tend to look at Performance management, Compensation, Recognition, Recruitment and Retention, Workforce planning and more while planning for succession. There has been a multitude of research that have used employee data to find useful insights for the succession planning of an organization. Aspects like Headcount, new hires and leavers, Gender distribution and organization tenure, Procedures, methods and analysis can help gather interesting data than can use predictive analytics to choose the best from the lot. Every employee is linked to a unique identifier (something like an employee ID) and this employee ID is used as the starting point to track individual changes over time. This helps in tracking experience, work and job transition.

To identify critical talent, one needs to know how important the talent is in terms of the success of your business strategy. Apart from that, we also need to look at:

  • Cost – the overall expenditure that one may need to incur in planning the succession.
  • Availability – check and see if the talent is available internally.
  • Skills – the core competencies that are needed to fill the position.
  • Urgency – how quickly does this have to be taken care of and how urgent is it to fill the position.
  • Ratio of the successors Vs critical senior positions

Apart from the above, we strive to find a match in terms of the company culture.  Someone might fit in perfectly but how they can fit in with the organisational culture is crucial, especially when it comes to senior roles. In the companies that I have founded, we have had a very open culture and whether people survived largely depended on their ability to adjust.

Today, software can be used to model changes in the organisational culture and can even check and see if a male or female leader would be a better fit. Big-data can even be used to look at the digital traces of culture in electronic communications (emails, Slack messages, reviews and other content). By studying the language employees use in these communications, how culture influences their thoughts and behaviour at work can be measured. Imagine a world where Predictive Analytics can predict the behaviour of individuals and find out what exactly you are looking for in terms of a cultural fit! Well, imagine no more!

Here are some of the other ways that Predictive Analytics can help in succession planning:

  • Mobilise employees with high potential, high retention risk and stagnancy risk for critical positions.
  • Predict the best fit for a company based on a talent index and diversity index. 
  • Measure suitability in terms of internal replacement versus external replacement.
  • Judge the replacement readiness of the identified talent.
  • Integrate performance, training, feedback, external factors, work plan and more for these roles.
  • Compute the impact on revenue and productivity that will result from engagement programmes.

I know that it is still not common to find organisations applying these analytics approaches internally to their processes when it comes to succession planning for their employees. However, we can see that HR functions are reinventing themselves and readying themselves for the future. Wouldn’t it be better if human biases can be replaced with a data-centric approach when it comes to selecting leaders?

Leave a Reply

Your email address will not be published. Required fields are marked *