Business Definition for: Succession Planning

The preparation for the replacement of one postholder by another, usually prompted by retirement or resignation. Succession planning involves preparing the new postholder before the old one leaves, possibly with training or through work shadowing. At a senior level, management succession should be accomplished as smoothly as possible in order to avoid organizational crises caused by absent or inadequate top management. General Electric is held to be an exemplar of succession planning for its successful transition following the retirement of Jack Welch.

Source: BNET

Auto Suppliers in Crisis: 2. Steps for Restructuring

The coming market structure correction in the automotive supply base will leave no company untouched. Auto sales are diminished, competition has increased, and financial constraints are greater; suppliers can no longer afford to subsidize weak businesses, especially those with little or no strategic value. It is now vitally important to free up resources and deploy them to those business units that have the potential to create sustainable, advantaged market positions. The most pressing challenge, of course, is deciding which businesses fit into this category.

An important, advantaged position is one that can be defended, and hence is sustainable. It’s critical not to confuse this with the ability to earn a profit today in a particular niche. Especially in the radical restructuring that suppliers are now facing, companies must continually challenge themselves to define what a competitor might be able to do differently to attack their position and put their profit stream at risk.
Read More