Learning and Development

Replacement Chart in HRM: Why Do You Need One?

5 Mins read

We are witnessing accelerated and unpredictable business processes.
Along with that, the need for quality employees is increasing as workforce market is becoming more and more competitive. With all the dynamics, in order to keep the business mechanism uninterrupted a flexible employee replacement should be planned.
In this article we are going to explore the employee replacement chart in HRM which allow organizations to identify employee gaps and helps to ensure a constant workforce backup.

Replacement Chart in HRM

Replacement chart is a succession planning tool that outlines significant job responsibilities in a company, as well as present and potential job gaps, assist companies and visualize critical job functions.

How Do Replacement Charts Work?

Replacement chart in HRM

For each empty position, specific competencies are defined, and then employees of the organization with the requisite competencies are categorized, resulting in the identification of possible replacements.

Roles contain details like possible replacements, age, qualifications, background, gender, and advancement prospective in replacement charts.

According to replacement charts employees are classified as: 

  • Ready for career advancement
  • Employees who would be ready for the upcoming promotions if given extra training
  • Employees who are performing sufficiently but need encouragement and improvement
  • Employees who are unfit for full-time work and must be replaced

After that, a comparison of the probable candidates’ experience and skill sets with those necessary for the post is carried up. With that the organization will be able to structure its succession planning and identify internal KSAs (Knowledge, Skills and Abilities).

Replacement charts are updated on a regular basis, particularly in reaction to changes in economic conditions or company activity.

The following questions are answered by the replacement charts:

  • Employee’s organizational background, as well as the competencies they possess?
  • Who are the most qualified candidates for a job vacancy?
  • In comparison to another employee, what are the advantages of picking a certain individual for the current position?

Replacement charts must be updated on a regular basis, at least once a year, and in response to changes in the marketplace and economic circumstances.

Succession Planning and Replacement Planning: What’s The Difference?

Companies usually mix up succession planning with replacement planning. Replacement planning focuses on covering a certain important position’s essential requirement. Because it is more of a reaction to urgency, there is less emphasis on employee talent development. Succession planning looks ahead, building strong “stocks” of successor candidates to give a rapid response in the event of a sudden loss of talent.
Here are some of the key differences between replacement and succession planning:

1. Planning Differences

Replacement planning addresses an urgent need.

The first point of disagreement is planning. When there is an immediate requirement, replacement is usually deployed. When a leader decides to resign, for instance, a position becomes open. After that, either a junior or an independent candidate is hired to fill the position. Because there is likely to be no transitional phase between the incumbent and their replacement, this frequently results in a steep learning curve.

Succession planning creates long-term talent capital.

Succession planning takes a long-term approach to assemble talented employees before it is required. Candidates will be prepared for a role if and when their managers decide to retire. Candidates are trained before a position becomes available. Intensive courses, such as work shadowing, become an alternative for candidates who want to prepare for their future duties. This foresight allows a company to plan not only for the replacement of leadership roles but also for the filling of gaps in middle management positions as these individuals advance in their careers.

2. Integration Differences

The replacement planning focuses on “this moment”.

Replacement hiring is reactive in nature, focusing on the here and now and the immediate requirement to fill a vacancy. Normally, the purpose of replacement hiring has been to select someone who is the most similar to the departing leader. As a result, there is little room for the role to develop and plan for the long term.

The goal of succession planning is to integrate policies across the organization.

Succession planning, on the contrary, starts at the top and is embedded into the company’s policy. Individuals can be recruited with their long-term potential in mind, even at lower levels of the business. By creating a survey about employees’ professional aims and desires, it can be included in performance management. To ensure successful candidates have the opportunity to enhance their skills and prepare for their career in your company, succession planning should be aligned with long-term strategic planning.

Take into consideration various ways you may include succession planning into your everyday activities to optimize your company’s benefits.

3. Decision-Making Differences

The status quo is kept by replacement planning.

Many businesses have a backup candidate in mind for their most management positions, even if they don’t have a formal succession plan in place. In most cases, this choice has been made “automatically,” and it may not have been done with care or consideration. Replacement hiring has the danger of perpetuating the status quo in a company and failing to reap the benefits of a thorough succession planning strategy.

Succession planning assists in the selection of candidates for certain roles.

The company can identify possible individuals based on the role’s needs and their ability to achieve those objectives with good succession planning. A well-designed plan will require multiple parties, including the position incumbent, their counterparts, and your senior managers, in determining the ideal applicants for the right role, using objective, evidence-based evaluations.

Although 71% of companies claim they have a management bank prepared for the sustainability of a role, only 30% report having a backup ready with options.

4. Outcome Differences 

Replacement planning may restrict current employees’ opportunities.

One of the possible disadvantages of replacement planing is that employees may find it difficult to understand whether they are being considered for promotion or not and if yes when to expect that promotion. As a result, retaining talented employees seeking advancement may be tough. Replacement hiring also makes it harder to grow great workers in the first place since it does not organically design for employees to expand their skills or experience.

Some employees may not even be ready to take on the role they were given in replacement hiring, resulting in possible expenses and delays for the company as the new leader learns the basics of their given role.

The goal of succession planning is to develop the skills of existing key employees.

The nature of succession planning is progressive. Even if you are unable to grant a high-potential worker a promotion at the time, giving them the opportunity to attempt new duties, to acquire experience on a range of projects, or develop their talents will keep them engaged and more likely to stay with your company. This has the extra benefit of generating a more developed workforce for you to choose from in the future whenever a post becomes available. Employees and companies alike benefit from the best succession planning strategies.

Replacement planning example

Replacement Planning Example

There are many examples of replacement planning. Here is one of the most common examples that we picked up: when a leader decides to retire a position opens up. The position is then filled by either a junior or an external candidate. The process of second option is much longer as it usually occurs a long learning curve for the new candidate. This is where the replacement planning comes to help․

Position replacement charts

A position replacement chart is a just a different name for a list of all the employees who can replace an employee in a specific employment role. Replacement charts for employees are digitized for convenient access and updated as needed. As a result, it assists in quantifying the benefits of picking an employee for a role and saves the organization from losing revenue in case of a sudden exit.

To conclude

As we already understood, replacement charts in your company will facilitate and accelerate the processes having in objective a stable and minimally interrupted working mechanism and business model.
It will help you manage the workforce flow and to be ahead of your competitors in the marketplace.

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