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Why L&D is an Essential Component of Succession Planning

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28 March, 2022

Succession planning is paramount to maintaining business continuity. When leaders, executives, or managers step down from their positions, they need to be replaced by intellectuals who have the same skillset, personality traits, and behavioural characteristics. But do you know if such individuals are present within your organization? It's only a matter of time you discover them.

Learning and development is a key succession planning element required to groom such employees within the company. When the time comes, they can occupy the vacated linchpin positions.

This article dives deep into why L&D is an inherent part of a succession plan. As a bonus, you'll also discover how to implement L&D in succession planning.

Let's begin!

The Role of L&D in Succession Planning

role of l and d in succession planningA succession plan is curated to find replacements for linchpin positions within an organization. Learning and development, on the other hand, aims to hone the skills of employees as well as equip them with new skills.

By combing L&D with succession planning, companies can groom their employees with the necessary competencies so that they can fill future vacancies. Incorporating L&D in succession planning is vital for companies to deal with future uncertainties and talent scarcity.

Here's why learning and development is one of the most critical succession planning elements:

1. The High Costs and Turnover of External Recruitment

Research indicates that external hiring is a lot more expensive than internal hiring. 

The cost of hiring depends on the position that needs to be filled. On average, however, external recruiting costs anywhere between $4000 - $6000. Internal recruiting, on the other hand, costs nearly $1000. What's more, the latter takes about two to three weeks while external recruiting takes one to three months typically.

Here are the other key differences:



External Hiring

Internal Hiring

Recruitment methods

Transfers or promotions

Company websites, job boards, employee referrals, social media, etc.

Employee turnover


Roughly 20% turnover in the first couple of months


Since the internal hire is already a great fit for the company culture, it makes the process a lot easier. Using the L&D program as part of succession planning, you can prepare employees for future roles in the organization.

Even though external hiring has its own benefits, grooming a well-deserving and capable candidate within your organization makes the process less tedious and costly.

2. The Underutilized Talent of High-Potential Employees 

high potential employeesHigh-potential employees (HiPo) leaving companies pose a big challenge. According to Harvard Business Review, only 5% of the workforce comprises high-potential employees.

This means that they are the most valuable assets for any organization. Identifying these employees and nurturing their talent through L&D is the backbone of succession planning.

But who are these high-potential employees anyway?

An article published on the HBR describes the "anatomy of a high potential employee." HiPos consistently outperform their peers and exhibit exceptional performance. Such competent individuals deliver superior results when presented with different challenges. However, high performance is not the only mark of a HiPo.  

They should also have the ability to lead and abide by the organization's values. Credibility is another key virtue. Their progress shouldn't be at the expense of others.

HiPos can also build confidence and trust among their colleagues. Let's take an example to understand who exactly is a high-potential employee: A sales associate that surpasses all targets each quarter may not necessarily be a HiPo unless they are also a team player and possess leadership talent. 

Thus, L&D is an essential succession planning element that's designed to prepare high potentials for future key positions – especially leadership and management positions.

Also Read: How to Build an Employee-Centric L&D and Assessment Program 

3. The Great Resignation

the great resignation

[Image Source]

As per the U.S. Bureau of Labor Statistics, there were 11 million job vacancies in October 2021. But the number of hires was only 6.3 million. Moreover, according to an SHRM study, about 40% of employees are planning to resign from their current companies (as of September 2021).

The situation is so dire that it has been named "The Great Resignation" in the business world. This has led to talent scarcity in many organizations.

To face these grim circumstances, experts have suggested developing HiPo talent to fill the unprecedented vacancies. Learning and development would also help retain your employees and make them future-ready leaders.

Check out the learning and development tools for team skill development.

Higher Turnover of CEOs

Even though "The Great Resignation" has mostly impacted mid-career professionals, CEOs too, have been exiting their current roles. As found in a 2021 report by Challenger, Gray & Christmas, Inc., the number of CEOs leaving their jobs increased by 54% compared to October of 2020. Most of these high-level exits occurred in the healthcare and technology fields.

There are various reasons behind the high turnover rate of CEOs. The disruption caused by the pandemic has led most of them to find new challenges and better ways of growing. In other cases, the board of directors initiated the change of leadership to counter the disruption.

Many mergers and acquisitions (M&As) during this period impacted their tenure as well. Since the pandemic served as a period of self-reflection, many even took a sabbatical or early retirement.

It's safe to say that organizations need to develop future-ready leaders by treating L&D as a key succession planning element.

4. New Leadership Requirements

new leadership requirement

L&D is a crucial succession planning element that can help meet new leadership needs. According to a survey conducted by Deloitte, approximately 80% of organizations confirmed that new leadership skills are key to their success. What are the most significant leadership needs in the 21st century?

Performance is no longer the only criterion. The report highlights many topics, including understanding automation, social responsibility, fairness, and inclusion as critical to a leader's success. Yet, only 30% of respondents surveyed were actively developing the leaders of tomorrow who can meet these new leadership requirements.

Some of the other modern leadership needs include:

  • Ability to manage employees remotely
  • Ability to lead quickly
  • Ability to resolve ambiguity and complexity

The same Deloitte report discusses the need to "refresh leadership from within." Most companies tend to recruit new leaders externally, who may or may not fit their corporate culture. Instead, they would benefit more from investing in HiPos within the organization.

HiPos already exhibit a keenness to learn, which is why it's possible to cultivate the required leadership competencies in them.

5. Instability Due to Loss of Linchpin Positions

According to CNBC, more CEOs resigned in 2019 than they did during the 2008 economic crisis. In the event of the loss of a linchpin position, there is a heightened uncertainty in a company. The loss can also be due to other reasons like sudden death or termination of employment.

But whatever the reason may be, the CEO maintains a sense of continuity and stability in an organization. Using L&D in succession planning, organizations can combat this instability.

How to Implement L&D in Succession Planning

Since it's been established why L&D is a vital succession planning element, it's time to cover how you can implement it:

1. Identify High-Potential Employees

identify high potential employees

Even though most businesses don't have a formal strategy in place to identify high potential employees, they do tend to do so informally.

In a recent survey conducted by HBR, it was found that about 98% of companies identify HiPo employees purposefully. Yet only 10% of them spend any time helping them evolve into future leaders. Since no company has infinite resources, it's important to allocate them judiciously.

These are the personality traits you should look for:

  • Curiosity: Most people lose their childlike curiosity as they grow up. Yet it's one of the most important attributes you should look for in a high-potential employee. Such individuals are willing to explore new ideas, approaches, and methods that add value to your company.
  • Conscientiousness: HiPos display high conscientiousness. They are driven, self-motivated, and passionate about their job. Moreover, they demonstrate discipline and strong planning skills.
  • Learning ability: HiPos are lifelong learners. Despite their achievements, they aren't plagued by complacency. They absorb new lessons like a sponge, and they possess the cognitive capability to use their learnings in practical applications.

In other words, they have what it takes to excel, lead, and inspire.

2. Invest in Their Learning & Development

After figuring out the high potential employees in your organization, the next step is to invest in their learning and development. It's important to view this as an investment because supporting them with key resources will give you tremendous returns when executing the succession plan in the future.  

Start by:

  • Creating a profile of linchpin positions that contains personality, experience, behaviour, and skillset
  • Identifying gaps in the current skillset of HiPo employees
  • Using the key position profiles to improve the existing skillset and behaviour of HiPo employees

3. Conduct Timely Revaluations

conducting timely revaluations

While it's important to chalk out a succession plan that has an L&D program within it, both of them should be flexible enough to make changes. During the execution of the L&D program, you may discover hidden talents in a HiPo employee. Those newly discovered skills might make them more suitable for an entirely different position within the company.

In a different scenario, you may find that they don't have the competency you thought they had to occupy a leadership or managerial position in the future. This is why it's important not to make concrete promises with your HiPo employees. Revaluation of the L&D program is indispensable in succession planning.

A 2019 report confirmed that it's vital to be transparent with your employees when it comes to succession planning. Millennials, in particular, appreciate the transparency and efforts invested in developing a succession plan. They are more likely to stay with a company that's serious about their training and development for a potential leadership position in the future.

Moreover, for evaluating qualities such as conscientiousness that can't be quantified, you'd need to weigh the opinion of multiple people.

4. Foster the Right Culture

Before even creating a succession plan, companies need to foster a culture where leadership development is valued. Internal conversations regarding leadership transitions shouldn't be kept top-secret; they should be actively encouraged and discussed.

Creating the right organizational culture is pivotal to the success of both the L&D program as well as the succession plan overall. L&D is a necessary succession planning element, critical for a company's success. Hence, employees at every level must understand its importance and take it seriously. That's only possible if leaders promote the right culture.

Many organizations undertake the following strategies to achieve this:

  • Executives must pick their successors
  • They should be involved in the HiPo's learning and development
  • They should be present during evaluations of the L&D program
  • They should work with HR to create a culture where succession planning and L&D are considered high-priority investments

5. Offer Personalized Training

personalized training

So, you've selected the HiPos, identified gaps in their skillset, and created an appropriate culture. What's next? This is where the actual learning and development happens.

Traditionally, companies delivered training through workshops and seminars. While those are beneficial, conventional L&D methods aren't personalized enough.

Personalized training is key to developing strong leadership skills. Such an L&D program has lifelong learning outcomes for the employee. Businesses today use mentoring, coaching, and self-directed learning. Each of these L&D methods is explained below.

  • Coaching: This involves monthly or weekly coaching sessions with managers or direct supervisors. In the past, performance reviews and training occurred annually. That's swiftly changing. Such frequent coaching sessions would also help HiPos become better coaches themselves in the future.
  • Mentoring: It may sound similar to coaching, but it's not. A mentor need not be a direct supervisor or a manager. As part of L&D in succession planning, HiPos need to be mentored through one-on-one sessions with executives. Mentoring would ensure that your company is prepared for future transitions.
  • Self-directed learning: A major part of L&D in succession planning, self-directed learning involves providing employees with on-demand, bite-sized learning content. HiPos can learn at their own pace as this content easily fits into their daily schedule.
Transform your succession strategy with our top 12 succession planning software.


Over to You

Through L&D in succession planning, businesses can quickly fill key positions that have been vacated by top talent. They can then be replaced by high-potential employees who have been nurtured for months or years to take up a new, higher-level role.

By doing so, organizations save costs, reduce turnover, obtain high ROI, meet new leadership needs, as well as improve their long-term health and stability.

L&D is thus an indispensable succession planning element that can be implemented by identifying HiPo employees, investing in their training, fostering the right culture, conducting regular evaluations, and providing personalized training.



Nishi More
Nishi More
Nishi More is a Marketer and content writer at iMocha. A writer who enjoys helping small businesses meet their hiring needs. When not writing she enjoys reading motivational books, latest trends in recruitment technology & explore new places.

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