Succession Planning: Retaining Skills and Knowledge in Your Workforce

Government of Alberta, Human Services

Employees can hold vast amounts of key experience, information, and skills, which walk out the door when they retire or leave an organization for other reasons. Employers that are unprepared can be left scrambling to run their day-to-day operations.

Key knowledge needed to run an organization exists at all levels, not just in management positions. Some is easy to recognize, such as technical skills and contact lists; other is more difficult to define or communicate, such as workers’ learned experiences that they may not realize are relevant. Retaining skills and knowledge is an important issue for organizations of all sizes. However, it is especially so for small and medium-sized organizations, which often have more critical knowledge concentrated in fewer employees.

Planning for the exit of knowledgeable employees is critical to the long-term success and competitiveness of businesses. Employers often use succession planning and knowledge transfer as risk management tools to keep critical knowledge in their organizations. Think of these tools as insurance for capital assets.

Employers often use succession planning and knowledge transfer as risk management tools to keep critical knowledge in their organizations.

Succession planning is the process of identifying and developing employees to fill key positions in an organization. It can prepare an organization for when other employees leave and for employee promotions, as well as for expansion or reorganization. Succession planning can make organizations more competitive, improve its retention of talented employees, and lower the risk of losing critical knowledge when people leave.

Knowledge transfer is the process of capturing skills and information and sharing them between employees and between parts of an organization. The goal is to make that knowledge available for current and future workers. Knowledge transfer applies to knowledge that is obvious and easily defined, as well as to that which is harder to define or articulate.

Knowledge transfer is an important part of the succession planning process; it is how employees get much of the information and skills they need to move into key positions.


Planning for Employee Succession

Succession planning is about developing your employees and supporting them in their careers to ensure your organization has the right talent for key positions. On a more strategic level, succession planning will help your organization remain successful even after the loss of a key worker. Other benefits include:

  • having the right people in the right place at the right time
  • developing a qualified pool of candidates ready to fill key positions
  • helping employees realize their career plans and aspirations
  • improving employees’ ability to respond to changes in the workplace
  • creating more opportunities for the timely transfer of knowledge at the corporate level

Human resource professionals say succession planning also helps retain valuable workers and lowers the costs of recruiting new talent, major considerations as the workforce ages.


Succession planning process

Different ways exist to implement succession planning in your workforce. The five steps in this section come from various resources, the private and public sectors, academic studies, and human resource and management consultants.


1. Make a demographic profile of your workforce

A good place to start the succession planning process is creating a demographic profile of your organization. A simple one lists the ages of your employees, their roles, and their skills. This can help you determine whether you are likely to lose key employees in the near future and whether you have any candidates to replace them. A demographic profile for your organization may help you answer these questions:

  • How old is your organization’s talent pool?
  • Do certain positions have more employees approaching retirement age?
  • Is a rich pool of candidates available to take their place?
  • How much time do you have to identify and develop replacements for employees who are retiring?

While a demographic profile can begin to answer some of these important questions, it may not provide the full story of the factors affecting your workforce. Speaking directly to employees about their future retirement or career plans can fill in the gaps and help you plan for the future.

Five steps of succession planning - keep in as a side bar only if we have the room

  1. Make a demographic profile of your workforce. It is a tally of the ages, roles, and skills of all your employees.
  2. Identify the key positions to determine the roles and skills that keep your organization going.
  3. Build job profiles for the key positions to document the knowledge, skills, and qualities required.
  4. Identify and assess potential candidates to decide who could advance to the key positions.
  5. Implement employee development plans to create learning and knowledge transfer goals for these candidates.


2. Identify key positions

Key positions are those that are crucial for your organization’s future success. Identifying them can help you focus your succession planning efforts where the risk of losing important skills and knowledge is the greatest. “Identify the ‘choke points’ of an organization — things that can stop the business from running,” says Anne Scott, a business counsellor with the Canadian Federation of Independent Business. She suggests answering these questions to identify key positions:

  • Does the position play a key role in meeting the organization’s goals? If so, what is the unique contribution of the position in meeting those goals?
  • If no one was in that position, would important aspects of the organization’s operations stop or be slowed down?
  • Does the position require specialized or unique skills or knowledge that may be difficult to replace?
  • Is the position difficult to recruit for, or is that talent hard to find?

When looking at key positions, it is important to envision how the skills and knowledge your organization has today will change as your business evolves. A good way to start looking at your future workforce needs is by identifying the amount and type of work you expect to do in the future. It is impossible to predict every change, but reviewing your organization’s strategic plan, business plan, or annual reports can help you identify:

  • types of work your organization plans for the future
  • types of work that may no longer be needed in the future
  • your organization’s expected growth rates
  • ways the work will get done (e.g., using new technologies or methods)
  • societal, technological, economic, or labour market trends that could affect the kind of knowledge your organization will need

A good way to start looking at your organization’s future workforce needs is by identifying the amount and type of work you expect to do in the future.


3. Build job profiles for key positions

The critical next step in succession planning is building job profiles — the knowledge, skills, and competencies required for key positions. A job profile should give you a complete picture of the position, what is actually done and how. The profile can also include the personal attributes and qualities that contribute to an employee’s success in the position.


4. Identify and assess potential candidates

With a completed job profile, you can identify strong potential candidates within your organization who could advance into key positions. Candidates must meet the minimum requirements in the job profile, have the potential to learn the rest, and have the desire to take on the position.

You can use these documented sources on employees to identify potential candidates:

  • performance ratings and reviews
  • specific accomplishments
  • feedback from supervisors and managers
  • skills assessments
  • technical and professional designations
  • past work experience
  • short-term trial projects

But the best source for identifying potential candidates may be your own employees. Those who see an equitable and fair succession plan in action are often eager to participate. They also more often express their interest in moving to more challenging roles.


5. Implement employee development plans

The final step in succession planning is to develop the talent of your employees. The job profiles built in step 3 can help determine where to focus your training and knowledge transfer efforts.

Employers commonly work with employees to create an employee development plan, which shows how they will narrow the gap between what they can already do and what they need to do to meet future requirements in a key position.


Monitoring your plan

Brien Perry, former vice-president of human resources at Calgary-based oil and gas producer Enerplus Corporation offers these questions to help you identify where your succession plan needs improvements:

  • Have all key jobs been identified, and do they have succession plans?
  • Are key positions filled quickly after a vacancy?
  • Do employees perform effectively in their new roles in key positions?
  • Do any key positions have no successors?
  • What is the ratio of external hires to internal hires?

Ultimately, whether your organization’s succession planning delivers a return on investment will depend on the original goals. And even these can change as the marketplace, technology, and employees change. Answering these basic questions can help you tell when you need an update of the plan:

  • Are the goals of the succession plan still appropriate?
  • Has critical technology changed?
  • Do key positions need to be added to the plan?
  • Do any marketplace or government changes affect existing plans for employee succession?


Basic strategies for transferring knowledge

Retaining the knowledge held by key employees and passing it on to potential replacements is an essential part of succession planning. Some quick and low-cost strategies will help your employees start sharing knowledge, regardless of the size of your company or the industry you’re in. You may be doing some of these things already. By taking even one small step, you will likely have some success in opening the lines of communication. At the very least, you will bring attention to the need for knowledge transfer in your organization.


1. Communicate with staff

Communication is key to transferring knowledge in your workforce. It builds relationships and trust, both of which are necessary to promote the transfer. Communicating with staff can be as easy as walking around and chatting informally with your employees. Ask them what they’re working on, how their processes work, or even how things could be made easier for them. Get to know them — it will help build an open and trusting environment in your organization. It will also help you identify who has what knowledge.


2. Make learning part of your organization’s culture

If you make learning part of your organization’s culture, knowledge transfer will become part of your employees’ everyday duties. Demonstrate that learning new procedures and improvements on current practices is a priority in your organization. Include it in your mission statement, job descriptions, and other materials. Take time to discuss with your workers the importance of succession planning and sharing knowledge.


3. Lead by example

Employees will feel more comfortable if they see their leaders sharing knowledge. To help lead by example, take steps to get all of your organization’s leaders on board. Reward them for their efforts and hold regular meetings to discuss knowledge sharing.



When done effectively, documenting knowledge can pass on detailed work information from one person to as many other workers as needed, regardless of time or space. For example, if an employee has clearly documented their progress in a business deal and suddenly leaves, another employee can step in and pick up where the exiting employee left off. Common types of documentation include manuals, databases, briefing notes, meeting minutes, project status reports, and wiki websites.

These questions will help you make the most of the documentation strategy:

  • What do people need to know?
  • Who is the audience, and how can they be reached?
  • Is the information being documented and shared in a way that is appropriate for the content and the importance of the material?


Success with succession planning

Planning for the departure of knowledgeable employees is critical to the long-term success and competitiveness of organizations. Succession planning is crucial insurance for the long-term viability of businesses. The benefits are enormous: Your organization will be more competitive, the retention of talented employees will improve, and you will minimize the risk of losing critical knowledge when people leave. While there are many challenges ahead, succession planning will help your organization be better prepared for the future.

Excerpt reprinted with the permission of Alberta Community and Social Services, Workplace and Career Planning. The complete publication can be found at alis.alberta.ca/succession. © 2012 Government of Alberta, Human Services

Drake provides valued succession planning support to business leaders by helping to determine the skills required, and identifying and selecting the most qualified individuals to move the business forward successfully. Our suite of Talent Management Solutions provides assessment and selection tools that go beyond traditional methods to ensure the very best fit. For your succession planning support, contact Drake in:

Africa: 27 21 425 3300
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United Kingdom: 0800 111 4558
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