ABBREVIATIONS

Ltd: Limited

PDP: Personal Development Programme

ILI: Infosys Leadership institute

i.e.: That is

CEO: Chief Executive Officer

CFO: Chief Financial Officer

COO: Chief Operating Officer

Etc: Excetra

EXECUTIVE SUMMARYIn succession planning, an organisation careful selects the right candidates and then grooms

them for the key positions of an organisation such as CEO, CFO, COO, etc. Thus, when they

join the company, every employee has a chance to fill in such key positions if he works hard

and helps fulfil the objectives of the company. This motivates the employees to do a better

job and keep up at it if they want to be the ones running the organisation. Infosys is an Indian

multinational corporation and uses succession planning successfully to appoint its heads.

Succession planning requires careful utilisation of principles of management such as planning

an organising. The organisation should have a proper structured plan as to how they are going

to select the required candidates and then train them. Even out of the selective candidates the

organisation must have a structured approach as to how they are going to further eliminate

and select employees for the required key position. Their training system must be such the

person is equipped to deal with every situation that can arise.

Thus, succession planning is process that requires equal coordination of planning and

organising to ensure the smooth and systematic succession process of any organisation.

1 INTRODUCTIONSuccession planning is a process for identifying and developing internal people with the

potential to fill key business leadership positions in the company. It is a process whereby an

organization ensures that employees are recruited and developed to fill each key role within

the company. Through succession planning process, one recruit’s superior employees,

develop their knowledge, skills, and abilities, and prepare them for advancement or

promotion into ever more challenging roles. Actively pursuing succession planning ensures

that employees are constantly developed to fill each needed role. As one’s organization

expands, it loses key employees, provides promotional opportunities, and increases sales,

one’s succession planning guarantees that one has employees on hand ready and waiting to

fill new roles.

To develop the employees one needs for their succession plan, use such practices as lateral

moves, assignment to special projects, team leadership roles, and both internal and external

training and development opportunities. Through succession planning process, one also

retains superior employees because they appreciate the time, attention, and development that

one is investing in them. Employees are motivated and engaged when they can see a career

path for their continued growth and development. To effectively do succession planning in

one’s organization, one must identify the organization’s long term goals. One must hire

superior staff.

One needs to identify and understand the developmental needs of one’s employees.

One must ensure that all key employees understand their career paths and the roles they are

being developed to fill. One needs to focus resources on key employee retention. One need to

be aware of employment trends in one’s area to know the roles one will have a difficult time

filling externally.

THE AREA OF STUDY OF PRINCIPLES OF MANAGEMENT

Planning

Planning is essential in every walk of life. Each and every person has to frame a plan to

recede in his activities. The plan period may be short or long. Planning is the first and

foremost function of management. Effective planning facilitates early achievement of

objectives, which depends upon the efficiency of the planner. A planner can develop his

efficiency by preparing himself to face the functional developments.

Organising

Organization is a mechanism or structure which helps the activities to be performed

effectively. The Organization is established for the purpose of achieving the business

objectives. Wherever may be the business objectives, there is a need of an organization. The

word ‘organization’ is derived the word ‘organism’ which means an organized body with

connected interdependent parts sharing common life.

THE REASON FOR CHOSSING THE TOPIC

Succession planning is an innovative and reliable method to ensure that at no point a

company is in a sudden dilemma to choose their next leader. While it ensures that a company

is always looked after it also makes sure that the employees are motivated to work hard for

they too have a chance of becoming the head of the organisation. Surprisingly not a lot of

companies have resorted to this mean. In succession planning the employees are selected and

then trained for key positions in the organisation. The topic has been given enough credit and

not a lot of people are aware of it. Thus, this topic was chosen so that the author could know

more in detail about succession planning and find out how effective and important it is.

ANALYSIS WITH FACTS AND FIGURES 2

INFOSYS

Infosys Ltd is an Indian multinational corporation that provides business consulting,

information technology, software engineering and outsourcing services. It is headquartered in

Bangalore, Karnataka. Infosys is the third-largest India-based IT services company by 2014

revenues, and the fifth largest employer of H-1B visa professionals in the United States in FY

2013. On 15 February 2015, its market capitalisation was   263,735 crores ($42.51 billion),

making it India's sixth largest publicly traded company.

Infosys was co-founded on 2nd June,1981 by Narayan Murthy, Nandan Nilekani, N. S.

Raghavan, S. Gopalakrishnan, S. D. Shibulal, K. Dinesh and Ashok Arora after they resigned

from Patni Computer Systems. The company was incorporated as "Infosys Consultants Pvt

Ltd." with a capital of Rs. 10,000 (roughly $250) in Model Colony, Pune as the registered

office. It signed its first client, Data Basics Corporation, in New York. In 1983, the

company's corporate headquarters was relocated from Pune to Bangalore.

It changed its name to "Infosys Technologies Private Limited" in April 1992 and to "Infosys

Technologies Limited" when it became a public limited company in June 1992. It was later

renamed to "Infosys Limited" in June 2011.

Infosys made an initial public offer (IPO) in February 1993 with an offer price of Rs. 98 per

share against book value of Rs. 20 per share. The credit rating of the company is A- (given

by Standard & Poor's on 13-Dec-2013).

Acquisitions

In December 2003, Infosys had acquired Australia-based IT service provider Expert

Information Services for $23 million.

In December 2009, Infosys BPO acquired Atlanta-based McCamish Systems for about

$38 million.

In January 2012, Infosys BPO acquired Australia-based Portland Group, provider of

strategic sourcing and category management services, for about AUD 37 million.

In September 2012, Infosys acquired Switzerland-based Lodestone Management

Consultants for about $345 million.

In February 2015, Infosys announced it would acquire the US automation technology

company Panaya for around $200 million.

Current Shareholdings

Shareholders (as on 31-Mar-2014) Shareholding1

Promoters group 15.94%

ADR 16.10%

Individual shareholders 09.95%

Banks, Financial Institutions and Insurance Companies 09.08%

Mutual Funds 04.58%

Others 02.25%

Total: 100.00%

SUCCESSION PLANNING AT INFOSYS1  Infosys Ltd Annual Report

Indian companies may have woken up to the realization that the way in which you manage

your succession plan has an important correlation to your financial fortunes.

A succession plan has long been put in place and the smooth transition of authority and

leadership ensured. Narayan Murthy will also continue as the non-executive chairman of

Infosys.

Of the seven original founders of Infosys, one of India's greatest corporate success stories,

only four will remain at the helm of affairs at the company from August, 2006: Nandan

Nilekani, S Gopalakrishnan, S D Shibulal, and K Dinesh. N S Raghavan retired in 1999,

while Ashok Arora had quit the firm much earlier, in 1989, to settle down in the United

States.

While Infosys continues to be in very good hands to take on any challenge, the IT major has

already identified a pool of 400 leaders who will steer it in the future. Especially, since the

founders of the company are in their early- or mid-fifties and due for retirement at 60.

The process of grooming its future leaders is long-drawn, meticulous and in consonance with

the company's stated vision: 'To be a globally respected corporation that provides best-of-

breed business solutions, leveraging technology, delivered by best-in-class people.'

This is where the Infosys Leadership Institute at the company's Mysore campus comes into

the picture. The 162,000 square feet structure, built at the cost of Rs 41.1 crore (Rs 411

million), is where the next generation of Infosys leaders is being primed.

The company identifies 'leaders' on the basis of several parameters: their performance

throughout their tenure with the company being a prime criterion for selection.

Great performance puts employees on the fast track to growth within the organisation and so

does their commitment to surpassing customer expectations, setting standards in business and

transactions, and being a paradigm for the industry and the company. Creativity, devotion to

being ethical and sincere in dealings, and the commitment to strive relentlessly in pursuit of

excellence are also major considerations while identifying future leaders at Infosys.

The company is run by the hands of the youngsters. Infosys believes that it is necessary to

recognise the power of youth and to nurture it. We must respect youth and create

opportunities for them to participate in everything. Which is why at every function, they have

the youth participating. They are the future.

The pool of leaders that Infosys has identified is from across the globe and does not comprise

of Indians alone. It is in keeping with the company's multi-national, multi-cultural image

where excellence is the most important condition.

There is a three-tier mentoring process at Infosys.

Tier-1 of the Infosys Management Council, which consists of the company's board of

directors, mentors Tier-2 leaders who in turn guide the Tier-3 group.

About 45 executives are a part of the company's Tier-1 of the management council. And each

of the leaders undergoes exhaustive and sustained training through the company's personal

development programme (PDP). Infosys training programmes are designed to enable

company professionals enhance their skill sets in tune with their respective roles.

The management council is an advisory body that takes strategic decisions on the company's

businesses and was set up by N R Narayana Murthy, with the idea of building an outfit that is

built to last and is ably geared to handle the uncertainties of a global market, the high and

lows of business cycles, and to power the company towards strong growth in the future.

When Narayana Murthy first set up the council, he found that the young go-getters in the

company were diffident to air their suggestions. It was then that the idea of an in-house

leadership institute was born. Encouragement from the top management has put an end to the

fears of transgressing the chain of command, and young Infoscians are now urged to give

vent to their creative talent and come up with their ideas and plans.

The faculty at the ILI has in a note spelt out the rationale behind the institute and charted out

the manner in which it operates.

The ILI was set up in 2001 to prepare Infosys to manage its exceptional growth; to prepare its

executives to handle the external and internal business environment; and through 'thought

leadership' creates better customer value.

The leadership development programme at Infosys takes after similar processes followed by

many global mega corps. It has been refined to suit the particular needs of Infosys and is

termed as the 'nine pillars for leadership development in Infosys.'

These nine pillars form the backbone of the PDP and each leader can choose from these

pillars for personal development. Depending upon the individual's need to grow and the

company's sensitivity to these needs, every (short-listed) individual is groomed to lead the

company in the future.

The chosen few i.e. 400 of the 58,409 employees identified as 'high potential Infoscians'

undergo a three-year 'leadership journey' that includes training, personal development

programme, interacting with other participants, understanding the company better and

resolving real business issues.

The nine pillars for leadership development

1. 360 degree feedback

This is the mechanism through which the company gathers data about an individual's

performance and abilities. This information is collected from co-workers, including peers,

subordinates, managers and customers. Personal development plans are prepared on the basis

of this feedback. Then, each of these individuals is assigned an ILI faculty member to help

prepare the PDP and to follow it.

2. Development assignments

Identified high potential Infoscians are trained at various functions of the company through

job rotations and cross-functional assignments. This helps employees to acquire new

leadership skills outside their own areas of expertise and experience.

3. Infosys Culture workshops

These workshops are designed to fortify the Infosys culture amongst the participants, help

instil better communication skills through sustained interaction amongst themselves, and

identify with the values and processes involved in leadership development.

4. Development relationships

This includes one-on-one interaction in actual on-the-job work climate and leads to better

sharing of knowledge and camaraderie amongst individuals. Mentoring forms an integral part

of this exercise.

5. Leadership skills training

The 'Leaders Teach Series' are workshops that the company's Tier-1 members, including

Narayana Murthy and Nandan Nilekani, hold to acclimatise the next rung with leadership

roles and to groom them through their own rich experience.

6. Feedback intensive programmes

These are akin to 360 degree feedback, but based on formal and informal feedback from

employees that an individual interacts with.

7. Systemic process learning

This helps individuals to gain an overall view of the company and its diverse and complex

systems, business, operations and processes. It is a continuous process and helps improve the

individual and also the systems.

8. Action learning

This exercise constitutes solving real problems in real-time conditions, but as a team.

9. Community empathy

The company stresses the need to give back to society through involvement in various

developmental, educational and social causes. This programme helps nurture a social

conscience amongst its leaders.

Training Centre in Mysore

As the world's largest corporate university,

the Infosys global education centre in the 340

acres campus has 500 instructors and 200

classrooms, with international benchmarks at

its core. Established in 2002, it had trained

around 100,000 engineering graduates by

June 2012. It can train 12,000 employees with

3 batches of 4000 employees for 4 months

each.

Infosys Technologies put in place succession

planning early last decade, when it identified some 400 potential leaders. Its Leadership

Institute in Mysore has played a big role in training leaders. Over 800 employees have

undergone the programme at this institute. Incidentally, Infosys even has an IT solution for

succession planning called Talent Edge that helps organizations determine successors for

employees who play critical roles. 

Infosys Leadership Institute (ILI)

ILI based in Mysore has 96 rooms and trains about 400 infoscians annually to become the

'leaders'.

Vishal Sikka is the CEO and MD of Infosys. Prior to joining Infosys, Dr. Sikka was a

member of the Executive Board of SAP AG and the Global Managing Board, leading all SAP

products and innovation globally. Sikka took over from S.D. Shibulal, one of the founders, on

1 August. He was inducted as a whole-time director of the Board and CEO & MD

(Designate) of Infosys on 14 June. He receives $5.08 Million ( 30 Crores) and stock options

worth $2 million as annual compensation

Name Period

N. R. Narayana Murthy 1981 to March 2002

Nandan Nilekani March 2002 to April 2007

S Gopalakrishnan April 2007 to August 2011

S D Shibulal August 2011 to July 2014

Vishal Sikka August 2014 to date

PRINCIPLES OF MANAGEMENT APPLIED3

PlanningPlanning is deciding the best alternatives among others to perform different managerial

operations in order to achieve the pre-determined goals.

-Henri Fayol

Planning is the function of management that involves setting objectives and determining a

course of action for achieving those objectives. Planning is the first and foremost function of

management. It is an intellectual process of thinking resorted to decide a course of action

which helps achieve the pre-determined objectives of the organization in future. Planning

requires that managers be aware of environmental conditions facing their organization and

forecast future conditions. It also requires that managers be good decision makers.

Methods

1. Objective plans: Objectives are treated as basic a plan that is necessary for all types

of planning operations. Objective also play role in organizing, directing and

controlling.

2. Standing plans: It includes policies and procedures and is liable repetitive actions.

Actions can be repetitive and non repetitive. It helps ready guidelines for solving

recurring problems. Recurring problems are solved in different way

3. Master plans: Master plan covers the complete course of action along with

consideration of time and strategy. Plans may be either broad or detailed in character

Planning is a process consisting of several steps. The process begins with environmental

scanning which simply means that planners must be aware of the critical contingencies facing

their organization in terms of economic conditions, their competitors, and their customers.

Planners must then attempt to forecast future conditions. These forecasts form the basis for

planning.

Planners must establish objectives, which are statements of what needs to be achieved and

when. Planners must then identify alternative courses of action for achieving objectives. After

evaluating the various alternatives, planners must make decisions about the best courses of

action for achieving objectives. They must then formulate necessary steps and ensure

effective implementation of plans. Finally, planners must constantly evaluate the success of

their plans and take corrective action when necessary.

Characteristics

      The Essential nature or characteristics of planning can be highlighted by the following

points.

1. Primary of Planning: The functions of management include planning, organizing,

staffing, directing and controlling. It is most basic management function. As a matter of fact

all other function of management largely depends upon planning. For example control cannot

exist without planning. Organization is also setup with a plan & objectives in mind. Planning

is therefore the primary function of Management.

2. An intellectual activity: Planning involves choosing the proper course of action from

among alternatives & calls for decision-making which is an intellectual process. Change in

the environment can bring several opportunities and involved risk as well. It is the task of

planner to take advantage of opportunities and minimize the risk.

3. A continuous function: Management is a dynamic process and planning as its function

cannot be an exception to it. More over as plans beget a number of sub-plans and since plans

have to be revised in the light of changing environment, planning becomes a continuous

function of Management.

4. Planning is flexible: As already pointed out, while planning, any one of the available

alternatives is selected. Planning selects the best alternatives based on certain assumptions.

There is a possibility of dead log in the functions of the management. Planning has one more

alternative to suit future situations.

5. For all managerial functions: Planning is a pervasive function of management. It is found

at all levels and all departments of an organization. Top management looks after strategic

planning. It involves choosing the future course of action from among alternatives.

Types

There are many different types of plans and planning.

Strategic planning involves analyzing competitive opportunities and threats, as well as the

strengths and weaknesses of the organization, and then determining how to position the

organization to compete effectively in their environment. Strategic planning has a long time

frame, often three years or more. Strategic planning generally includes the entire organization

and includes formulation of objectives. Strategic planning is often based on the

organization’s mission, which is its fundamental reason for existence. An organization’s top

management most often conducts strategic planning.

Tactical planning is intermediate-range (one to three years) planning that is designed to

develop relatively concrete and specific means to implement the strategic plan. Middle-level

managers often engage in tactical planning.

Operational planning generally assumes the existence of organization-wide or subunit goals

and objectives and specifies ways to achieve them. Operational planning is short-range (less

than a year) planning that is designed to develop specific action steps that support the

strategic and tactical plans.

OrganizingOrganizing is the function of management that involves developing an organizational

structure and allocating human resources to ensure the accomplishment of objectives. The

structure of the organization is the framework within which effort is coordinated. The

structure is usually represented by an organization chart, which provides a graphic

representation of the chain of command within an organization. Decisions made about the

structure of an organization are generally referred to as organizational design decisions.

Organizing also involves the design of individual jobs within the organization. Decisions

must be made about the duties and responsibilities of individual jobs, as well as the manner in

which the duties should be carried out. Decisions made about the nature of jobs within the

organization are generally called “job design” decisions.

Organizing at the level of the organization involves deciding how best to departmentalize, or

cluster, jobs into departments to coordinate effort effectively. There are many different ways

to departmentalize, including organizing by function, product, geography, or customer. Many

larger organizations use multiple methods of departmentalization.

Organizing at the level of a particular job involves how best to design individual jobs to most

effectively use human resources. Traditionally, job design was based on principles of division

of labour and specialization, which assumed that the more narrow the job content, the more

proficient the individual performing the job could become. However, experience has shown

that it is possible for jobs to become too narrow and specialized. For example, how would

you like to screw lids on jars one day after another, as you might have done many decades

ago if you worked in company that made and sold jellies and jams? When this happens,

negative outcomes result, including decreased job satisfaction and organizational

commitment, increased absenteeism, and turnover.

Recently, many organizations have attempted to strike a balance between the need for worker

specialization and the need for workers to have jobs that entail variety and autonomy. Many

jobs are now designed based on such principles as empowerment, job

enrichment and teamwork. For example, HUI Manufacturing, a custom sheet metal

fabricator, has done away with traditional “departments” to focus on listening and responding

to customer needs. From company-wide meetings to team huddles, HUI employees know and

understand their customers and how HUI might service them best

Organizational Chart

Principles of organization

1. Principles of definition

Every position in every organisation should be clearly described in writing. According to this

principle, all the functions in a concern should be completely and clearly defined to the

managers and subordinates. This can be done by clearly defining the duties, responsibilities,

authority and relationships of people towards each other. Clarifications in authority

responsibility relationships help in achieving co-ordination and thereby organization can take

place effectively. For example, the primary functions of production, marketing and finance

and the authority responsibility relationships in these departments should be clearly defined

to every person attached to that department. Clarification in the authority-responsibility

relationship helps in efficient organization.

2. Principle of objective

All organisations and each part of any undertaking should be the expression of a purpose,

either explicit or implied

3. Principle of specialization or division of work

The work of every person in the organisation should be confined as far as possible to the

performance of a single leading function. According to this principle, span of control is a

span of supervision which depicts the number of employees that can be handled and

controlled effectively by a single manager. According to this principle, a manager should be

able to handle what number of employees under him should be decided. This decision can be

taken by choosing either from a wide or narrow span. There are two types of span of control:-

a. Wide span of control- It is one in which a manager can supervise and control

effectively a large group of persons at one time. According to this span, one manager

can effectively and efficiently handle a large number of subordinates at one time.

b. Narrow span of control- According to this span, the work and authority is divided

amongst many subordinates and a manager doesn't supervises and control a very big

group of people under him. The manager according to a narrow span supervises a

selected number of employees at one time.

4. Principle of coordination

The final object of all organisations is smooth, effective coordination.

5. Principle of efficiency

6. Principle of uniformity

7. Principle of correspondence

Formal authority and responsibility must be co-terminus and equal

8. Principle of unity of command

It implies one subordinate-one superior relationship. Every subordinate is answerable and

accountable to one boss at one time. This helps in avoiding communication gaps and

feedback and response is prompt. Unity of command also helps in effective combination of

resources, that is, physical, financial resources which helps in easy co-ordination and,

therefore, effective organization.

Authority Flows:

Managing Director

↓

Marketing Manager

↓

Sales/ Media Manager

↓

Salesmen

9. Principle of balance

10. Principle for responsibility

The responsibility of higher authority for the acts of its subordinates is absolute

11. Principle of explanation

12. Principle of authority

13. Principle of leadership facilitation

14. Principle of equilibrium balance

15. Principle of continuity

It is a never ending continuous process that is required at every stage of an organisation. At

every point it is important to ensure that right people are there for the right job.

16. Principle of span of control

The work of every person in the organisation should be confined as far as possible to the

performance of a single leading function

17. Principle of exception

18. Principle of flexibility

19. Principle of principle

20. Principle of simplicity and homogeneity

21. Principle of unity of direction

22. Principle of joint decision

Classification of organization

A. Formal

B. Informal

FORMAL ORGANIZATION

The formal organization represents the classification of activities within the enterprise.

Indicates who reports to whom and explains the vertical journal of communication which

connects the chief executive to the ordinary and workers.

Characteristics of formal organization

1. Properly planned, based on delegated authority, deliberately impersonal,

responsibility and accountability at all levels of organization should be clearly

defined.

2. Organizational charts are usually drawn.

3. Unity of command is normally maintained.

4. It provides of division of labour.

INFORMAL ORGANIZATION

Informal organization is an organizational structure which establishes the relationship on the

basis of the likes and dislikes of officers without considering the rules, regulations and

procedures. The informal organization relationship exists under the formal organization the

informal organization relationship or informal relation give a greeter job satisfaction and

result in maximum production.

Characteristics of informal organization

1. Informal organization arises without any external cause. i.e. Voluntarily.

2. It is social structure formed to meet personal needs.

3. Informal organization has in the organization chart.

4. It acts as an agency of social control.

5. Informal organization can be found all levels of organization within the

managerial hierarchy.

Difference between Formal and Informal Organisations Formal Organisation Informal Organisation

Formal Organisation Informal Organisations

It is created by the top management. It is created out of natural desire of the people to associate.

It is created so that the job of an organisation is performed in a systematic

and planned manner.

It is formed to satisfy those needs of the members which cannot be satisfied through

formal organisation.

Managers have formal authority. The authority of the leader depends upon the combined support of the group members

It is managed by officially appointed managers.

Members elect their own leader.

It is permanent and stable. It is temporary and it changes its size and membership from time to time

THEORIES

CLASSICAL THEORY

• Division of labour:

• Scalar of functional processes:

• Structure;

• Span of control

Characteristics of classical theory

• It is based on division of labour, objectives and tasks of organization, Co-ordination

of efforts.

• It is concerned with formal organization.

• it believes in human behavior of the employees.

• It fixes a responsibility and accountability for work completion.

MOTIVATION THEORY:

Motivation is the force that initiates, guides, and maintains goal-oriented behaviours. It is

what causes us to take action, whether to grab a snack to reduce hunger or enrol in college to

earn a degree.

The forces that lie beneath motivation can be biological, social, emotional, or cognitive in

nature. There are various ways to motivate a person. It could be through giving praises in

front of others or providing with a well deserved bonus or even promotion.

4LEARNINGS

LEARNINGS FROM SUCCESSION PLANNING IN AN

ORGANISATION LIKE INFOSYS

It serves as contingency planning and keeps the organization well prepared for any sudden

attrition that may happen and reduces the impact of losing key employees to a great extent

By insisting on succession planning, managers get to identify various skill-sets among the

team members and their strengths come to light

Also, employees who are identified as successors based on the skill-sets they possess can be

groomed well to handle the relevant positions, and any skill-set that is lacking in the

employee can be developed by providing appropriate training and opportunities

Employees get to have a well-defined road map of their career and it serves as a motivation

factor for them to perform even better

Employees who get to understand that their organization has future plans for them, will

tend to stay with the organization for longer time

Internal employees already have a good understanding of the organization and its goals.

Thus, it saves a considerable amount of time and cost for the organization in hiring and

inducting new candidates for these positions

Overall, it creates a very positive atmosphere within the organization and leaves employees

feeling extremely satisfied in terms of career progress and highly motivated

WHY SUCCESSION PLANNING HAS FAILED IN SO MANY ORGANSISATIONS

The practice of vetting and selecting potential successors has come a long way in recent

decades. Cases of a departing CEO anointing his own hand-picked successor used to be

common; they’re now very much the exception, except when the CEO is the company’s

founder. Succession has come to be seen as a board of directors’ most critical responsibility;

with the CEO just one participant in the process (although handling his role can be a sensitive

issue). The challenge is to have a plan adaptable to the dynamic nature of the succession

process and the shifting demands on the CEO position. And as with any other sort of plan, the

hard part is actually executing it. The reasons for this are:

Board members too often fear they can’t find a truly viable successor inside the

company. This can result from a lack of exposure to internal candidates and a

subsequent lack of true understanding of what those candidates are capable of. The

board may simply be unfamiliar with anyone not close to the CEO’s office. The CEO

may be optimistic about a successor he’s grooming while the board hasn’t had the

chance to develop confidence.

External candidates are more exciting and promising. There is a paradox in

succession planning: Internal successors are in many ways lower risk than outsiders,

yet surprisingly few promotions are awarded internally. That appears to be because

boards often prefer the devil they don’t know to the devil they do. Also, some find it

difficult to imagine someone at the top after seeing him operate in a lesser role for

years. Meanwhile internal candidates hear over and over that they are still just a year

or two away from being ready.

The successor has to be ready now. The concept of the “ready now” executive is not

useful and should be stricken from the business lexicon. If a company did manage to

make a “ready now” successor, the only way it would know would be after the fact–

perhaps when that candidate was running a competitor because he is tired of waiting.

Such executives often end up doing very well somewhere else, proving that there

actually was a viable candidate all along that the company was ignoring.

CEO succession planning is single-person event. When boards take on succession

planning, they often focus on the CEO role–the role that gets the most attention in the

media and in the marketplace–to the exclusion of other positions. But the best

succession planning really involves a constant assembly and reassembly of a

leadership puzzle with many pieces. In fact, the pieces themselves aren’t of constant

shape or size. As each piece is selected–from CEO, CFO and COO to sales and

marketing chiefs and other C-level officers–the shape of the remaining pieces

becomes clearer. And external factors such as company strategy, economic conditions

and the like also affect the way the puzzle is solved.

What worked in the past will work in the future. When a board is planning to replace a

legendary, or even merely successful, CEO there is a strong danger in framing the

process by looking in the rear-view mirror. What a company needs in the next six

months and beyond may be drastically different from what was needed even in the

last quarter. An individual who sees the company and its industry through a new set of

lenses may be best prepared to recognize and seize new opportunities. Jamie Dimon

was markedly different from Bill Harrison at JPMorgan Chase, as was Marius

Kloppers from Charles Goodyear at BHP Billiton . All four leaders have been

successful–but each successor was quite unlike his predecessor.

Infosys has found to overcome these issues by opening a training centre. It chooses 400 of its employees to go through training. Thus, it is not necessary for the board members to know all these members personally. Also, the training institute ensures that all the key member positions are assigned to the necessary employees. Since, these employees are trained for the particular positions, they are capable and are equipped to deal with every situation that may arise and so the board members are not worried that an unworthy employee has been appointed for the job.

BIBLIOGRAPHY• http://blog.synergita.com/2013/07/succession-planning-importance/

• http://download.nos.org/srsec319/319-13.pdf

• http://www.rediff.com/money/2006/aug/03mspec.htm

• http://timesofindia.indiatimes.com/tech/it-services/How-Wipro-Infosys-Cognizant-

create-their-leaders/articleshow/15324301.cms

• http://www.managementstudyguide.com/organizing_principles.htm

• http://www.infosys.com/

• http://www.zdnet.com/article/the-importance-of-succession-planning/

• http://catalog.flatworldknowledge.com/bookhub/5?e=carpenter-ch01_s03

• http://www.forbes.com/2009/07/30/succession-planning-failures-leadership-

governance-ceos.html

• http://www.huimfg.com/abouthui-yourteams.aspx

• http://tpcbbapm.blogspot.in/2012/08/definition-nature-of-planning.html

• http://humanresources.about.com/od/glossarys/g/successionplan.htm

ACKNOWLEDGEMENT