Tech & Digital Firms Say Succession Planning More
Important Now Than Before Recession
• Majority of tech firms say succession planning now more important than in 2006 (69%)
• Three quarters of tech employers say it is set to become even more important in the future (77%)
• More tech firms concentrating on blend of short-term and long-term succession planning than UK average (54% compared to 44%)
Tech firms say succession planning is now more important to them than it was in 2006, research from Randstad Technologies, the specialist IT and technology recruiter, has found.
In a poll of 100 leading HR directors, three quarters of the HR directors working in the tech industry said it was now more important than it had been before the recession (69 per cent).
According to Workpocket 2014/15, Randstad’s guide to HR, published today, succession planning focuses on identifying potential future leaders to fill key positions. And in a climate of talent shortage and lack of confidence in leadership potential, there is renewed interest in succession planning – 77 per cent of HR directors working in tech firms say it is likely to become a higher priority in the future, compared to 67 per cent across the UK.
Mike Beresford, MD of Randstad Technologies said: “Sound succession planning is not just about risk-mitigation. It helps to ensure key employees know they’re being groomed for a particular position, which gives them a strong sense of having a clearly defined future within the company. This is a powerful retention tool and taps into career fulfilment. With the growing talent shortage at senior and middle manager level, and the real scarcity of Tech talent, it’s never been more important to offer another ‘carrot’ especially as it’s no longer possible to rely on pay packets and bonuses to retain the best top 15 per cent of your workforce.”
Previous Randstad Technologies research forecast that in order to support the predicted UK population by 2050, the IT workforce would need to grow by nearly 5,000 a year to eet the demands of the sector – making talent shortages all the more ferocious.
SCALE OF TALENT MANAGEMENT IN TECH
Additionally, of those organisations carrying out succession planning, 54 per cent of tech employers focus on more than just the top level of management and below – drilling down to the top three levels – compared to the UK average of 30 per cent.
Mike Beresford said: “Traditionally, companies felt succession planning should be limited to a handful of senior management positions – it was a process reserved for the big jobs like replacing Steve Ballmer at Microsoft. By focusing on only the top one or two levels of management, Succession planning was supposed to remain manageable as only a small percentage of the workforce will be involved in succession planning. But that risks demotivating and alienating a large portion of your workforce. Plus, as recruiters know, a growing number of middle-management positions are becoming as challenging to fill as some of the top spots. From this point of view, tech firms are paragons of succession planning virtue.”
Technology employers are also at the forefront of technological innovation in succession planning. Software now exists to enable organisations to link available jobs with potential successors and help determine whether a specific role would help in personal development. Almost half (46 per cent) of HR directors in tech firms say they are using this sort of software – compared to just a quarter (25 per cent) across the UK.
And to ensure succession planning is meeting business needs, those responsible need to know as much as possible about the future of the business, how it is likely to change, and how those changes might affect the skills future leaders need to possess. 77 per cent of HR directors in tech say those responsible for succession planning in their organisation knew as much as possible about the future of the business, marginally more than the UK average (67 percent).
Mike Beresford said: “The ever-changing nature of organisations means that succession planning is an ongoing process. It’s not just about the initial interview process it’s also about long-term development and investment in training to ensure that the talent of the future grows as the company grows I suspect it won’t come easy to a lot of CEOs – but decision makers need to share their thoughts on the future of their organisations. It’s counterproductive not to bring your senior HR & training practitioners into the circle of trust.”
Almost half (44 per cent) of the UK’s blue-chip employers undertake both short and long-term succession planning. But in tech, it’s over half (54 per cent).
Mike Beresford said: “It’s a tricky trade off in the IT sector. On the one hand the sheer speed of innovations means there will always need to be a certain amount of focus on immediate talent needs. But the real key to success is hiring flexible, creative thinkers who can continually evolve and stay at the forefront of the rapidly changing digital environment. Long-term succession planning is a must to stay ahead in today’s fiercely competitive market where the big established players need to keep a wary eye on start-up entrepreneurs.
The 2014/15 issue of Workpocket can be ordered here:
Randstad Technologies is part of the Randstad group, one of the leading recruitment & HR services providers in the world with a top three position in the UK and the United States.
In the UK, Randstad’s business lines serve the public and private sectors across accounting and financial services; business support; construction, property and engineering; education; health and social care; interim management and search; human resources; IT; student and worker support and in-house and managed services.
At the end of 2013 Randstad had 1,520 corporate employees in the UK, working in 147 locations (incorporating 53 in-house sites). UK revenue in 2013 was €769.6 million. Randstad Holding nv was founded in 1960 and is headquartered in Diemen, the Netherlands and listed on the NYSE Euronext Amsterdam. For more information see www.randstad.co.uk and www.randstad.com.