Succession Planning - Developing Leadership for Future Growth

By HR, 3EA
Succession Planning - Developing Leadership for Future Growth

The Human Resource Advisory team of 3EA assisted a client in reorganizing its human resource structure. The client is a leading manufacturing company with revenues of 500 cr. and had grown organically with multiple field offices across the globe. The organization had allowed significant autonomy for outside India operations, but most of their business functions were centralized. The executive board had realized that they were potentially losing efficiencies and business growth by being centralized. Lack of succession planning was another pain point for the board. A new board member from financial background was given the charge to assess the value of an HR Shared Service across the organization, and he contracted 3EA to assist in the reorganization.

The Advisory team assisted the HR management team in establishing and implementing a comprehensive approach to restructuring the organization by redesigning their job responsibilities, formulating the policies and providing them a performance appraisal system based on the balanced scorecard approach. Our experts helped the organization decentralize and consolidate disparate HR functions under an HR Shared Service model, resulting in a significantly more functional and efficient department This was done by making executive board understand the rationale and principles of a Shared Services organization and the benefits and potential liabilities of creating a hybrid organization which a blend of centralized operations and empowerment of employees. This involved a series of sessions with key executive board members.

Once the executives conceptually agreed to embark on a journey of HR Restructuring, the next task was to determine the current state of the HR organization. In order to adequately evaluate the current state, the team conducted focused group interview and audited existing documents across the company. This included understanding the current issues faced by the internal human resource department and conducting an analysis to identify redundancies and gaps.The entire module was created on the concept of Appreciative Inquiry which is change management approach focusing on identifying what is working well, analyzing why it is working well and then doing more of it.

Our experts assisted the internal departments to define a future-state organization based on the data and recommendations from the discovery phase. This research resulted in a detailed plan, which included the creation of a Human Resource Management system which was accessible to every employee. The CXO concept of hierarchy was introduced for the employees who had more than ten years of experience within the organization and were holding senior managerial role. This was recommended to empower the employee as an individual who would be in different business operations, reporting to the centralized executive board and serving as a liaison between the executive board and the functional team. In addition, an estimated budget was established in the HRMS that identified both employee savings and expenses.

This model was a departure from what the employees were accustomed to, hence periodic review meetings were undertaken to both educate executive board members and solicit their buy-in. Many of the employees viewed this restructuring as a loss of control at the local level, and hence the long term benefits of the restructuring had to be carefully demonstrated. After the executive board gave conceptual agreement to the new restructuring model, the internal team began implementation of the new organogram with the assistance of 3EA consultants. This implementation involved both consolidating existing systems and creating a service-center model. In addition, existing employees were invited to express their feedback regarding the entire restructuring model.

Two years after the reorganization, the HR department had been completely consolidated and adopted by all of the various business units served through global operations. The HR department was functioning much more effectively than in the previous centralized model. This was particularly true regarding their CXOs, which were empowered to capitalize on best practices to offer streamlined and efficient services for business expansion and growth. The ongoing competency assessment tests ensured that the right people were put into the right positions for maximum impact. Talent gaps was also identified and recruitment was done as per the requirement of key positions. 3EA was involved with this project from inception to conclusion, over two years in consultation with all of its industry and domain experts. The implemented organizational structure is now going into its fourth year and is seen as a huge success by both the internal human resource team and the executive board.

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Article by: HR, 3EA