When planning to fill management positions, it is often protocol for most businesses to hire recruiters and pay a large sum of money in return for an established name.
However, recent reports have suggested this form of growth may not be the most beneficial to a business.
What is Succession Planning?
Succession planning focuses on identifying and growing talent to fill business-critical positions in the future. Put simply, a succession plan is a component of good HR planning and management and will focus mainly on senior management positions, although where possible all positions should be incorporated.
A succession plan will, therefore, be responsible for the growth and development of employees whilst creating a clear cut route for career development.
The benefits of training and promoting internally
Internal promotion is a cost-effective solution for all businesses. The cost of hiring a recruiter to find your suitable candidate is a very costly experience with studies finding that the cost of recruiting and training a middle manager can cost between six and nine months of that candidate's salary, with recruiter fees increasing the higher up the employee.
However, it is not just recruiter fees that cause expense within external recruitment, as not only do external recruits get paid more, they are also 61% more likely to be fired from their new jobs than those who were internally promoted, again costing the business more money to recruit again.
Internal employees adapt better to new roles
Although external recruits tend to have a higher level of knowledge and experience within their chosen field, it is important for all employees to understand how a business works. Internal recruits will already have a deeper understanding of how the business works and will, therefore, be able to complete tasks quicker as they will understand for example: which colleague they will need to ask to approve certain projects or when and how to file projects within the business systems, making jobs more efficient.
It has also been stated that only after two years will an external employee’s performance review be of the same level as the internal promotees, however, in most cases, employees of certain levels who feel they are undervalued are more likely to leave before the two-year mark.
Motivated employees perform better
Monitoring your employees' progress in order to review for promotional purposes will, in turn, see those employees work harder. If an employee believes that they will not only be recognised but rewarded for their efforts it will motivate them and adds incentive to do their best job throughout the course of their employment.
Need help training your employees?
Here at MDA Training, we understand how to nurture and develop your employees. Our tailored training programmes ensure each demographic and skill set is taken into account in order to produce the best possible outcome and subsequent return on investment.