Succession Planning and Strategic Planning - Essay Example

Week 4: Project Plan Outline Name: Click here to enter text. Project Working Title: SUCCESSION PLANNING Problem statement / research issues … and why this is a problem. Stated most simply, a problem is the difference between what is, and what might or should be. "No child should go to bed hungry, but one-quarter of all children do in this country," is a clear, potent problem statement. Another example might be, "Communication in our office is not very clear." In this instance, the explanation of "what might or should be" is simply alluded to. Write down a "problem statement" – a comprehensive definition of the problem. Before you do, remember to define the problem in terms of needs, and not solutions. If you define the problem in terms of possible solutions, you're closing the door to other, possibly more effective solutions. "Violent crime in our neighborhood is unacceptably high," offers space for many more possible solutions than, "We need more police patrols," or, "More citizens should have guns to protect themselves." Business organizations operating in the United Arab Emirates (UAE) are investing huge amount of time and money in creating and implementing leadership and employee development programs to maintain a steady talent workforce (Lim, 2013; PricewaterhouseCoopers, 2015). However, current business organizations are presently encountering difficulties in sustaining talents, leadership, and productivity because of the changing demography of workers and attitudes towards work. The situation is likely to worsen in the foreseeable future. In the UAE, the current demographic trends of the entire labor force show a highly aging population of the Baby boomers and the entry of Gen Y workforce in a tight labour market (Lim et al 2011; Lim, 2013). As Lim et al (2011) established, a talented crop of employees, the majority of who come from the Baby boomer generation, are either retiring or considering retiring in the UAE. The situation is an indicator of problems in ensuring organizational continuity in terms of talents, leadership, culture, and productivity. Additional problems include gaps in leadership positions as well as a vacuum of leadership skill (PricewaterhouseCoopers, 2015). Yet, the Gen Y who are supposed to take up their places are coming up with work cultures that pose threats to ensuring continuity of cultures while they succeed the Baby boomers (Lim et al 2011). According to Kim & Yang (2013), while the Baby boomers tended to build their professional careers in a highly competitive environment, Gen Y workers continually seek career advancements, have a more international perspective, need more training, seek flexibility at work and lack the willingness to stay in organizations for the long-term. Critically, when the Baby boomer move out over the next seven years or more, organizations will be shifting their sources of competitive advantage from tangible assets to tacit knowledge embedded in the minds of employees (Kirkland, 2010). This calls for effective mechanisms to evade the risks of disappearance of valuable human resources and to promote continuity (Kim & Yang, 2013). Organizations need effective succession planning strategies to manage their operations when the workers move out of the organization while seeking advancement in their career, retirement, termination, long vacations, or death. Succession planning is therefore a critical concern, since a large proportion of the Baby boomers are either retiring or considering retiring. Succession planning will help organizations to deal with their talent pipeline. According to Ebrahimi and Mohamad (2011) business organizations need to focus their attention on succession planning to transfer talent and leadership to younger generation of workers to avoid leadership and innovation crisis in the foreseeable future. This shows the significance of applying succession planning to fill the vital vacated positions. Given current trends in career planning among younger employee generations, new strategies in succession planning are needed to develop and retain talented workforce. Gather information on the problem. Start with what you know. Write down what you know about the problem. Then decide what information is missing. Information is the key to effective decision making. If you are fighting child hunger, do you know which children are hungry? When are they hungry – all the time, or especially at the end of the month, when the money has run out? If that's the case, then your problem statement might be, "Children in our community are often hungry at the end of the month because their parents' paychecks are used up too early." You might collect any of several types of information available. Most commonly, what you hear or read will fall into one of the following categories: Facts (15% of the children in our community don't get enough to eat.) Inference (A significant percentage of children in our community are probably malnourished/significantly underweight.) Speculation (Many of the hungry children probably live in the poorer neighborhoods in town.) Opinion (I think the reason children go hungry is because their parents spend all of their money on inappropriate things.) In the United States, current studies have expressed concern that the heavy exodus of Baby boomers who are moving into retirement may exert pressure on equity returns because of the retirement-induced equity sales. This may lead to a decline in the overall demand for equities globally (Peter 2012). An estimated 83 million baby boomers currently exist in the United States. More than 90 million of this age group are expected in 2025. The underlying question, however, is how effectively the workforce gap will filled by Gen Y to ensure continuity in leadership and talents (Kim & Yang, 2013). Demographics also indicate that those aged between 35 to 44 years old will experience a 15 percent decline, while 64 million of will retire representing 40 percent of the current workforce (Vanguard, 2013). Hence, organizations will need to accelerate succession planning to address the issue of continuity. Indeed, Kirkland (2010) mentions that succession planning is critical. A similar trend is taking place in the UAE. In a recent review of the UAE labour force by Peter (2012), the researcher reveals that Generation Y has grown with a booming economy in a society striving to balance international and traditional values. Hence, they have more international focus. According to a recent research by Ashridge, the Gen Y workers are shown to have attitudes that are more international-focused than the retiring Baby boomers. The research by Ashridge also indicated that more than 50 percent of Gen Y workforce seeks faster career advancement and high salaries, as well as the desire to leave within two years. Therefore, rather than seek power and authority like the Baby boomers, Gen Y look for higher pay, more flexible work and short-term work (Peter, 2012). Lim (2013) also shows that the current workforce is demographically distinctive as it spans four generations, namely Generation Y (those currently under the age of 30); Generation X (those aged 30-44 years); Baby Boomers (those aged 45-64 years); and the Traditionalists (those aged 65 years and beyond). The Gen Y consists of those born between 1980 and 1999(Kim & Yang, 2013). Generation Born Traditionalist 1925-1945 Baby Boomer 1946-1964 Generation X 1965-1979 Generation Y 1980-1999 As most business organizations in UAE expect a large exodus of the Babyboomer workforce, it becomes essential for the organisations to effectively engage and retain as steady flow of its productivity and competiveness. Indeed, estimates indicated that Gen Y will in due course replace 80 million baby boomers over the next seven years (Lim, 2013). According to Deloitte, between 40 and 60 percent of the workforce will come from Gen Y and younger generations by 2025 (Kim & Yang, 2013). Options for a logical ‘argument’ … What is the problem? Why does the problem exist? Who is causing the problem, and who is affected by it? When did the problem first occur, or when did it become significant? How much, or to what extent, is this problem occurring? As Baby boomers exit and Generation Y take over, the core problems organizations in UAE will be facing include the changing attitudes toward career development and organizational engagement, diminished long-term commitment to organizations and changing work and life value. Still, the core problem is that many HR professionals and business organizations, as Kirkland (2010) shows, are either unprepared or ill-equipped to confront the succession challenges resulting from an aging workforce. Therefore, there is a pessimistic future for organizations with ineffective succession planning strategies in place. A more critical view suggests a wait-and-see approach that inquiries into the massive exit of Baby boomers from the workforce. The consequences will vary based on each organization’s unique aspects including the number of Baby boomer generation works it has (Lim, 2013). Kirkland (2010) explains that there are different reasons why the HR professionals are ill-prepared for succession planning. In his view, most organizations approach traditional succession planning as if it was a “zero-sum game.” This is a situation where an employee’s losses or gains are equally balanced by the losses or gains of other employees. Therefore, once the gains are added up and the losses subtracted, the sum becomes zero. For one to win, the other has to lose. Rather than use the ‘zero-sum game’ approach, Kirkland (2010) points out that organizations would have been prepared for the issues of succession using a ‘non-zero-sum game.” Under the zero-sum approach, for organizations to create employment opportunity for Gen Y workforce, it has to remove the Baby boomers from their positions. Practically, many organizations with poor succession planning strategies facilitate retirement of Baby boomer generation workers through early retirement incentives, downsizing and reduced investment in the aging workforce. Kirkland (2010) comments that such as strategy has led to problems in terms of poor continuity of organizational culture, poor talent management and poor leadership continuity. Overall, organizations need to find, develop and retain talent as the valuable contributions to ensuring smooth transitioning. Effective succession planning will enable organizations to compete effectively and to attract and retain the next generation of workers (Ebrahimi& Mohamad, 2011). It will also enable employees to correspond with the competencies their organizations’ needs presently as well as in the future. Organizations will also be able to promote more flexible workplace practices to help the Gen Ys to fit in and the retirees to help fill gaps. Anticipated outcome/opinion … how will this problem be solved? What do you anticipate will be a good solution for this problem and why? Organisations will need to create multicultural culture. This would entail planning elemental changes in organizational culture (Ebrahimi& Mohamad, 2011). The whole organizational culture as well as the working environment will need to be changed to create the required welcoming, flexible and supportive environment for the Gen Y workforce. Strategies to this effect include starting cultural awareness programs, policy changes, and diversity training programs. The strategies should focus on reframing the issue from the challenge of having an aging workforce to the challenge of having a more multigenerational workforce. Kirkland (2010) suggests that HR professionals will need to determine the aspects of corporate culture that require retaining to fit in with the Gen Y workers, and those that needed to be changed. Organisations will need to engage in talent management. This entails identifying the right candidates, rather than the talents and skills, needed for the organization’s future. Those identified to replace the retiring Baby boomers will be taken through organizational learning to identify and reinforce their talents and leadership skills, relative to that of the retiring workforce. Motivation strategies such as benefits and compensation plans are also crucial for influencing desirable behaviors in Gen Y workers. Organizations will need to design and implement distinct benefit payment and benefits that motivate the new generation of workers to stay. Examples include higher perks and foreign trips to satisfy their thirst for international pursuits (Kirkland, 2010). How would this solution be implemented in context? Is it practical? Implementation would require planning for the vacancies that need replacement, or where Baby boomers are likely to retire. This will be followed by identifying the right potential candidates and preparing them to fill the job through training on organizational culture and talent succession. The solutions are practical as they are designed for promoting the management’s awareness of future staffing needs, minimizing turnovers of Gen Y workers, ensuring fully qualified replacements to Baby boomer workers are made, providing growth opportunities to motivate and retain next generation of workers and lastly, creating channels to ensure knowledge transfer during worker succession. It will benefit the organization by filling vacancies quickly with competent individuals, hence minimizing any loss of productivity. It will also help identifying qualified candidates to give the promise of career advancement in consistency with what the Gen Y workers are looking for (Kirkland, 2010). References Ebrahimi, S. & Mohamad, N. (2011).Succession Planning: A Necessary Process in Today’s Organization.International Journal of e-Education, e-Business, e-Management and e-Learning 1(5), 371-377 Kim, J. & Yang, Y. (2013).What can we do to attract and retain young people to our company as we find it difficult to attract employees at all levels? Retrieved [22 Feb 2015] from Cornell University, ILR School site: http://digitalcommons.ilr.cornell.edu/student/40/ Kirkland, E. (2010). Workforce/Succession Planning and Strategic Planning. Alexandria: International Public Management Association for Human Resources Lim, H., Tayeb, L. & Othman, A. (2011). Understanding the new Middle-East workforce: Employment expectations of Generation Y professionals in Saudi Arabia. Journal of Research in International Business Management, 1(9), 262-277 Lim, H. (2013). Work Motivators of Saudi and Emirati Generation Y: A Pilot Study. International Journal of Economy, Management and Social Sciences 2(5), 85-195 Peter, K. (2012). Understanding ‘Generation Y’ In The UAE.Gulf Business. Retrieved [22 Feb 2015]: Vanguard (2013).Baby Boomers and Equity Returns: Will a Boom in Retirees Lead to a Bust in Equity Returns? Retrieved [22 Feb 2015]: Read More