Why succession planning matters more than ever

The electricity sector in Canada is changing. Older workers are retiring. New technologies are constantly evolving — and bringing with them new skill and competency requirements. It’s a demographic shift that looks set to transform the whole industry.

The impact of the COVID-19 pandemic is also not one that can be understated. Following big shifts in the way we work, finding the right talent to accommodate this new world is essential. Issues such as safety knowledge and experience, diversity and inclusion, and remote work are going to require more important skillsets for future generations of employees.

Employers that spend the time now to analyze and define critical roles and their related competencies will be in a better position to drive business when the need for those roles is fully realized.

If we’re to make sure that critical positions are not left vacant tomorrow, the whole industry needs to take action today. We need to set out steps to identify and develop key talent in ways that will pay off significantly down the road.

Succession planning lacking

This would seem to be easier said than done. The topic of such succession planning should be discussed more broadly and in more contexts than it is currently.

In a 2017 labour market intelligence study from Electricity Human Resources Canada (EHRC), it was revealed that while 69 per cent of Canadian electricity employers had succession plans in place for management, less than half had succession plans for other occupational groups including engineers and engineering technologists (48 per cent), trades (43 per cent), information and communications technologists (32 per cent), and renewable occupations (26 per cent).

This could be particularly damaging for the electricity sector, where industry trends such as automation, digitization, artificial intelligence and remote process control will soon bring about new jobs that were not even conceivable just a few years ago — thereby changing the skills and competencies that are needed.

These evolving competency requirements will affect not only frontline technical specialist positions, but middle and senior management positions that will also feel the brunt of the impact. Digitization management and automation strategies, for instance, are already becoming critical process management skills that are required by companies in the energy utilities and resources industries.

Employers that spend the time now to analyze and define critical roles and their related competencies will be in a better position to drive business when the need for those roles is fully realized.

What’s more, these are skillsets already in high demand and low supply in other areas of the economy, which will mean increased competition for talent.

Just as innovative new technologies will transform how the sector generates, distributes and manages the use of electricity, demand for workers across and within occupational groups will also change.

Barriers to succession planning

This state of urgency begs the question: Why exactly isn’t succession planning at the forefront of every HR professional’s mind?

There are a number of reasons. Most competency gaps become visible only when an employer encounters unexpected problems — and the returns that come with facilitating and implementing a deliberate approach to succession planning are usually not visible in the short term.

It’s all too easy for a sense of complacency to take root. People retiring or leaving a company achieve a level of “unconscious competency” and do not realize that they need to share information with less experienced employees. Those with relatively stable, formalized operational processes may find it difficult to capture and transfer the tacit or implicit knowledge that has taken them years to acquire.

It all boils down to human dynamics. Senior-level managers often find it difficult to hand over years of hard-earned knowledge and “get out of the way” of the process. If they feel they are losing the recognition and respect they have earned for their many contributions, they may resist or resent succession planning and development initiatives — and this will really put the brakes on bringing incumbents on board.

According to Nicole Patey, Director, Talent Strategies & HR Business Partnering, at ENMAX, “Other barriers to a good succession plan could include a lack of interest in or awareness of existing successor information, a lack of processes or tools, or an overemphasis on short-term issues, meaning the organization lacks the data or insights to develop an effective longer-term talent plan.”

None of these obstacles are conducive to a bright and forward-thinking future. Such mindsets can all too easily act as shackles, chaining organizations to defunct approaches — a challenge for an ever-evolving industry such as the electricity sector.

It’s clear, then, that the upcoming need for renewed talent needs to be taken far more seriously. Be they replacement candidates (people who can step into critical positions on brief notice; for example, if a successor has not yet been identified), succession pool candidates (who have been earmarked as ready for promotion to the next level within the next 12 to 18 months) or retention candidates (high-flyers who have shown the ability to deliver excellent performance across multiple roles) — frameworks and strategies need to be deployed to ensure as smooth a transition as possible.

Guidebook provides answers

All these topics and more are placed in the spotlight in EHRC’s new Succession Planning Guidebook, a practical reference for employers looking to steward organizational knowledge through retirements and role changes. Based on best practices and featuring process descriptions for key competencies and roles and worksheets for putting it all into action, the guidebook demonstrates how advanced preparation allows for smooth transitions in the case of unexpected vacancies, as well as making the case that succession planning can aid in an organization’s ability to support diversity, equity and inclusion in the workplace.

To develop this guidebook, EHRC has drawn on recent labour market intelligence (LMI) data as well as a national overview of what’s happening throughout the electricity industry, including assessments of several organizations’ current succession planning programs. This work was led and supported by a steering committee of experienced HR practitioners from across the sector.

The result is a framework for effective succession planning and management, including how to define critical positions and competencies, identify and develop “successor” employees, manage talent pipelines, and communicate your succession strategy throughout your organization.

“Succession planning can be of great value to large, medium and small organizations. A visible succession plan helps to protect the long-term future of your organization and we hope our general guidebook will help you and your organization create a successful succession plan strategy,” says Shelagh Ell, Director of Talent Practices at ATCO Group.

Developed in Alberta, there are lessons that can be applied nationally — the Succession Planning Guidebook is essential reading for any HR professional seeking to navigate the future.

For more information, visit www.electricityhr.ca/succession-planning-guidebook.
The Province of Alberta is working in partnership with the Government of Canada to provide employment support programs and services.