Litirature review Essay Example | Topics and Well Written Essays - 1250 words

Litirature review - Essay Example Strong leadership is a very important ingredient in the success of an organization. A change in the leadership of an organization might result in changes in the organization structure, strategies, policies and the way the organization does it business. Moreover, with the movement of a leader from the organization, the close subordinates also move with the outgoing leader which might result in substantial change in the management of an organization. At the same time, it is important that the employees of the organization must relate to the new leadership. It is important that whenever there is a need to change the leadership of organization, suitable candidates are identified as soon as possible. For this, it is important to identify and nurture young talent in the organization. The transition to a new leader shall be smooth so that the employees do not feel uncomfortable under the changed leadership. Any organization will, for surely have change in its leadership and because of the s ignificant changes undergoing during this period, it is important that the transition is managed in the best possible way. Hence it is important that the area of leadership transition and succession planning is carefully reviewed. This paper will analyze the already existing literature in the area of succession planning, its important and identify the best ways to manage leadership transition. ... Often the area of succession planning is concerned with the succession of leaders. Types of succession planning The process of succession planning needs a thorough understanding of the strategy of the organization. There have been various models of performing succession planning such as ‘relay succession’, ‘horse- race successions’ and ad-hoc succession. While in relay succession, the leaving person identifies an individual, and then grooms the person, horse-race successions are more competitive in nature and the Board decides the successor amongst many candidates. An ad-hoc succession involves selecting the best possible candidate who is present at that particular point of time. In case, firms are not able to identify a potential successor, boards often appoint an interim leader who occupies that position until a permanent person is hired for the position. Of all the ways, relay succession is the most common type of succession planning undertaken by compani es (Brickley et al., 1997). Relation between firm performance and succession planning Previous research has suggested that the performance of an organization is significantly impacted by the succession process adopted. More disruptive succession processes impact the performance of the firms negatively (Zhang and Rajagopalan, 2004). At the same time, the performance after a change in leadership is also impacted by actions of the successor and the internal and external situation of the change (Rowe et al., 2005). The success of a succession planning exercise depends on various factors such as involvement of the outgoing leader, sincerity of the performance review of all the candidates, accurate prediction of the talent need that might arise, and the consistency of