Ms. Kruse

Human Resources, Recruitment & Training

Succession Planning for Hourly Employees: How to Identify and Develop Internal Talent at Lower Levels

By JoAnne Kruse, Founder, HCpartners

Succession and career development concepts have been thoroughly explored at the executive and management levels, with most companies providing cultural and experiential training required to cultivate future leaders. But perhaps an even greater return on investment is available by identifying and developing hourly employees in bench positions – jobs that typically are critical to an operation and can wreak havoc if unexpectedly vacated. Succession planning and development of lower level staff can become an effective driver of improved retention, higher productivity and engagement.

Succession planning and career development efforts are typically driven by the need to identify and develop future talent to ensure a level of continuity in operations and leadership. However, the need to ensure continuity of knowledge and minimize the impact of unplanned vacancies is not limited to the C-suite. Although succession efforts typically start with middle management, the historical feeding pool for future executives, hourly, supervisory and many positions below middle management warrant inclusion for the same reasons.

A key component of talent management includes addressing the needs of future succession in key positions. Typical succession processes consider the position, the person, or both. Position-based succession requires the identification of key or bench positions, those jobs that would create a significant negative impact on the operation if vacant or filled with a poor performer. These positions are usually characterized as providing a competitive advantage; requiring long learning curves and/or experiential learning as key development method; or act as critical influencing roles. Identification and development of successors is based on a clear understanding of the current and future skills and knowledge required to perform the accountabilities of the role, and succession is generally an exercise focused more on replacement and risk management. A good example of a bench position is the General Manager of a property.

Person-based succession program assumes that the capabilities, behavioral competencies and contributions of an individual are critical to the company’s future success and proper identification and development of the “right” individual will serve the interests of the company long term. Identification and development of successors is based on culturally-desirable behaviors, individual experience and knowledge, and the underlying belief that the person makes the job, not the other way around. An example of a person-based program is a behavioral based assessment tool like 360 degree feedback is used as a core component of identifying and developing “stars”. A combined position- and person-based program is the most effective way to identify and develop talent needs, typically forecasting needs and availability of talent over a 12 to 36 month period. The two work in concert through a systematic review of bench positions, assignment of potential successors, and identification of high potentials who may not match specific roles, but are viewed as strong resources for a variety of yet undetermined positions.

Practically, succession systems are driven by the future staffing needs of a dynamic environment. Whether family-run or a large corporate setting, the need to evaluate and build talent pipeline stems from several different factors:

• Limitations in available talent due to an aging workforce, changes in labor demographics, visa restrictions, and the economy limiting mobility.
• Skill gaps in training, knowledge, education, communication and technology in the existing and future workforce.
• Retention and continued engagement of top performers and talent in bench positions.
• The cost, productivity implications, and operational impact for the recruitment, development, replacement of personnel.

When we consider the impact of the 82 million Baby Boomers ready to retire with only 45 million Gen-Xers available to replace them, how the bust in the housing market has further tightened workforce mobility, or that almost one-third of high school graduates fail to graduate with their class,(i) the importance of extending the concept of succession to key positions and personnel below middle management is self-evident. Creating succession planning for lower level employees requires similar processes and tools to what is usually used for executive succession, with particular attention to job skills and requirements. Succession is ultimately about ensuring a capable pipeline of talent, and to do so require the three process steps of assessment, match, and manage.

1) Assessment of talent may take many forms, but traditionally there is a tight link between performance management and job design. This step is typically conducted following an annual performance review process, with identification of bench positions and the necessary skills and knowledge required to complete current and projected job duties. Individual assessments may also include behavioral competencies through formal 360 degree feedback, mentor evaluations, peer review or other multi-rater assessments. Ultimately, the assessment of individuals and roles culminates in a gap analysis, revealing individual talent capability and availability as well as current and forecasted needs.

2) The next step is to match available talent with future requirements. The process is usually managed with an organizational chart in hand, and key criteria like readiness, timing for replacement, and the assignment of individuals based on a “talent to task” pairing. The matching usually is completed through a group discussion between managers, HR and other key decision makers of talent in the company. Employees are usually rated based on performance, readiness for other roles, promotability and other criteria important to the appraising company’s talent strategy. Management ownership and leadership is key, as well as the necessary processes and systems for managing the employee and organizational data. Smaller organizations may capture information on spreadsheets, while the need to track and report succession decisions for bench positions and commitments to individual development for larger companies can be done through a variety of talent management technologies.

3) Most importantly, however, is the ability to manage the decisions identified through the succession process. Once the person and the position have been assessed and a gap analysis has been completed, execution against individual development plans and organizational design play a prominent role in the process. Unlike their executive counterparts, hourly succession decisions usually require a stronger focus around skills and competencies in the near term, with development of qualifications through specific training or job assignments. Knowledge transfer at the individual or group level often occurs through skills training, cross- and multi-skill training, and job rotation to ensure hourly employee readiness for current and planned roles. Other programs, like mentors, special projects and job enrichment are excellent alternatives to assessing and managing the experiential development of high potentials. Equally important in the management of the process is clear and candid communication between managers and employees, and reward and recognition programs that appropriately incent desired behaviors.

Succession planning requires an investment of time and resources for a payoff that may be years in the future. Continuity of talent in bench positions and the ability to retain and engage top performers is of huge benefit to an organization regardless of the level of talent. For hourly employees, planning for knowledge transfer, investing in talent to stabilize operations during times of change, and the opportunity to create a more productive workforce is of paramount importance in the hospitality industry. Executives who exercise good management practice, focus on talent development throughout the organization, and create a clear line of site on the skills, knowledge and abilities required for the future are likely to develop a sustainable competitive advantage.

References:
(i) Bridgeland, J.M., DiIulio, Jr. J.J., and Morison. K. B. March 2006. The Silent Epidemic: Perspectives of High School Dropouts. Civic Enterprises. March, 2006.

JoAnne Kruse has over twenty years experience in the field of human resources, culminating in the founding of the HR consulting services company, HCpartners. HCpartners is dedicated to supporting companies in the areas of Talent, Rewards and Performance. Ms. Kruse and her team leverage their extensive experiences in acquisition and integration, human resources, infrastructure design, and executive leadership to improve the profit and effectiveness of their client organizations, companies located internationally across all industries. Ms. Kruse can be contacted at 973-896-3302 or jkruse@hc-partners.net Extended Bio...

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