Career and Succession Management is undergoing fundamental change, driven by skill shortages, the global war for talent, and a new generation of employees valuing varied working experience and flexibility higher than traditional, linear career progression.

Primarily the HR managers in past, were concerned with strengthening of the leadership pipeline. However today there is a need to improve retention of experts on all levels, as well as engagement with the employer.

Recent report by the Top Employers Institute on Career and Succession Management, based on study conducted on global HR Best Practices Survey among 600 companies in 96 countries reveal two key findings that are forcing HR managers to rethink succession management strategies. They are:

1. Skill shortages and a global competition for best talent, and an increased risk of losing business-critical knowledge due to the ageing of the workforce
2. A new generation of workers that is seeking diverse work assignments and flexibility, and is taking greater responsibility for their own career management, resulting in less loyalty to their employers and less interest in the traditional step-by-step climbing of career ladders.

These developments are leading to career and succession management becoming more important within HR, as its role evolves from the former niche of assuring smooth succession of top leadership to long-term staff retention.

See: Succession crisis: Almost half of family-owned firms in Singapore have no heirs

An interesting finding from this study as revealed by David Plink, CEO of the Top Employers Institute, “It is no longer possible for HR managers to try and hold on to top performers, applying the traditional set of incentives. What is needed is a broader approach to employee development with greater awareness for the changed needs and values of the younger workforce. HR managers have to move away from being talent hoarders to playing their part as talent producers.”

“If you want people to stay long term, and not to go anywhere else, then they need to know why they are staying, and that is very much a performance discussion, but more importantly a career discussion,” said Antoinette Irvine, HR Vice President at Unilever. “Clarity and transparency around career plans to all employees become increasingly important when you are dealing with talent that is very marketable.”

Organisations that are successful in career and succession management increasingly use integrated technology (Talent Suites). The most common Career & Succession Management practice supported by technology is an online personal development plan (85% of top performing companies have this in place), followed by competency models (79%), and employee profiles (75%).

The least technology-supported practices are defined career paths (58%) and succession plans (57%), which indicates more of a focus on short term Career & Succession Management rather than pursuing a long-term strategy. To successfully cope with these retention challenges, strategic workforce planning has to be closely linked to career and succession management in order to identify capabilities and capacities needed in the future, and to prepare for future gaps.

Also read: Most Promising Careers for Millennials in 2015