gsm mba dissertation

i

GSM MBA DISSERTATION

DISSERTATION TITLE

AN ANALYSIS OF THE IMPLEMENTATION OF SUCCESSION PLANNING

PRACTICE IN THE BANKING INDUSTRY IN ZIMBABWE.

DISSERTATION METHODOLOGY (please tick one)

QUANTITATIVE

QUALITATIVE X MIXED METHODS

INTAKE (YEAR AND MONTH)

JULY 2013 (INTAKE 2)

Registration No.: STUDENT NAME:

R021491F

RUFARO JESSIE MUTASA

DISSERTATION SUBMISSION DEADLINE

SUBMISSION DATE

29 FEBRUARY 2016 29 FEBRUARY 2016

This statement should be completed and signed by the student producing the dissertation.

Declaration and Statement of Authorship:

1. I hold a copy of this dissertation, which can be produced if the original is lost/damaged. 2. This work may be reproduced, communicated, compared and archived for the purpose of detecting plagiarism. 3. I give permission for a copy of my marked work to be retained by the Graduate School of Management for review and comparison,

including review by external examiners. I understand that:

4. Plagiarism is the presentation of the work, idea or creation of another person as though it is your own. It is considered cheating and is a very serious academic offence that may lead up to expulsion from the program. Plagiarised material can be drawn from, and presented in, written, graphic and visual form, including electronic data, and oral presentations. Plagiarism occurs when the origin of the material used is not appropriately cited.

5. Enabling plagiarism is the act of assisting or allowing another person to plagiarise or to copy your work. Last Name First Name Signature

MUTASA

RUFARO

ii

Dedication

I dedicate this dissertation to my dear parents and siblings, for their love, encouragement and

unconditional support.

iii

Declaration

I, Rufaro J Mutasa, do hereby declare that this dissertation is a result of my own work,

investigation and research, except to the extent indicated in the acknowledgements,

references and comments included in the body of the report and that it has not been

submitted in part or in full for any other degree to any other university.

.................................................. ....................................

Student signature Date

.................................................. .....................................

Supervisor signature Date

iv

Acknowledgements

I would like to thank the Lord whose favour strengthened and gave me will power during

my studies toward attaining a Masters Degree in Business Administration. I amsincerely

grateful to my supervisor for his invaluable advice, guidance and steadfast patience that

made this dissertation a success.His practical criticism, foresight and knowledge were of

great worth in the writing of this work.

My gratitude also goes to all the lecturers at University of Zimbabwe Graduate School of

Management (UZGSM). They helped in shaping this dissertation by providing the

theoretical knowledge which was fundamental to the production of this dissertation. I also

thank my MBA friends for their encouragement and friendship throughout the duration of

the degree programme.

I would like to acknowledge the assistance I received from all participants who took time

out of their busy schedules to attend to my questionnaires.

I am greatly indebted to my friend and husband, Takunda, whose love and support sustained

me during my studies. I would also like to thank my childrenfor understanding and bearing

with my absenceespeciallyduring weekends when they needed a mother’s attention.

I would also like to thank everyone who contributed in one way or another towards the

completion of this project.

v

Abstract

Succession planning studies have been mostly conducted on family owned businesses due to

the fact that the majority of family business operations start and end with the initial

owner.This study focused on banks for the simple reason that they are custodians of public

funds and are expected to be accountable to various stakeholders.The purpose of this

dissertation was to investigate and draw inferential conclusions pertaining to the

effectiveness of succession planning in Zimbabwe’s banking industry. This was done

through analysisofthe banks’ currentimplementationprocessof the practice. By virtue of

standing regulatory requirements, banks are expected to have business continuity plans in

place, particularly for top leadership positions, so the assumption is they already practice

succession planning. The study intended to analyse the current succession planning practice,

examine the challenges banks are facing in implementing it and discuss the strategies that

can be adopted to improve it.

Empirical data was obtained through administration ofexploratoryinterviewquestionnaires to

thirteen respondents in the banking industry. A qualitative philosophy was adopted and the

obtained data was analysed using the content analysis approach. Findings were tabulated and

discussed.

The study concluded that, although banks have succession plans in place as required by the

regulatory authority (Reserve Bank of Zimbabwe), the implementation process of the plans

is flawed by numerous challenges, amongst which lack of management support tops the list.

The process is therefore not running the full cycle.In light of these findings, the researcher

recommended thatsuccession planning be included as a key result area for top management’s

performance appraisals. The Board should be held accountable; human resources

management personnel should competently facilitate implementation with the aid of robust

HR systems. Succession planning should be formulated into policy in order to strengthen the

practice. The policy will make it more communicable and involving such that it seizes to be

a mystery or just another HR practice. The regulatory authority is advised

toproactivelymonitorand ensure banks adhere to identified successors’ developmental plans

they would have proposed and agreed on. The researcher also recommended need-

basedtraining and continuous professional development of the identified successors in order

toensure desired outcomes are achieved. This should be donewith the aid of periodic

evaluations so that progress can be measured.

vi

Table of Contents Dedication .............................................................................................................................................. ii

Declaration ............................................................................................................................................ iii

Acknowledgements ................................................................................................................................iv

Abstract ................................................................................................................................................... v

List of tables ............................................................................................................................................ x

List of Figures ........................................................................................................................................xi

List of Abbreviations ............................................................................................................................ xii

CHAPTER 1: INTRODUCTION AND BACKGROUND ..................................................................... 1

1.1 Introduction ....................................................................................................................................... 1

1.2 Background to the study .................................................................................................................... 1

1.2.1 Succession planning in Zimbabwe’s banking Industry ............................................................ 2

1.2.2 Business Environmental Analysis ............................................................................................ 4

1.3 Statement of the Problem .................................................................................................................. 9

1.4 Research Objectives ........................................................................................................................ 11

1.5 Research Questions ......................................................................................................................... 11

1.6 Research Proposition ....................................................................................................................... 12

1.7 Significance of Study ...................................................................................................................... 12

1.8 Limitations ...................................................................................................................................... 13

1.9 Scope of study ................................................................................................................................. 13

1.10 Dissertation Structure .................................................................................................................... 13

1.11 Summary ....................................................................................................................................... 14

CHAPTER TWO: LITERATURE REVIEW ....................................................................................... 16

2.1 Introduction ..................................................................................................................................... 16

2.1.1 What is Succession Planning? ................................................................................................ 16

2.1.2 Succession planning as a Talent Management tool ................................................................ 19

2.2 Theoretical Framework underpinning Succession Planning ........................................................... 20

2.3 Succession planning ........................................................................................................................ 23

2.3.1 Current Practice ...................................................................................................................... 23

2.3.2 Scope of Succession planning ................................................................................................ 25

vii

2.3.3 Implementation of Succession planning ................................................................................. 28

2.4 Challenges facing Succession planning .......................................................................................... 29

2.5Strategies to conquer Succession challenges .................................................................................... 32

2.6 Succession planning Models ........................................................................................................... 35

2.6.1 The Seven-Pointed Star Model for Systematic Succession Planning ..................................... 35

2.6.2 The Ohio’s talent tomorrow and beyond succession planning model .................................... 37

2.6.3 Succession planning case study .................................................................................................... 38

2.7 Research gaps .................................................................................................................................. 39

2.8 Research Conceptual Framework .................................................................................................... 40

2.9 Chapter Summary ............................................................................................................................ 41

CHAPTER THREE: RESEARCH MEHODOLOGY .......................................................................... 42

3.0 Introduction ..................................................................................................................................... 42

3.1 Research Design .............................................................................................................................. 43

3.1.1 Descriptive studies ................................................................................................................. 43

3.1.2 Explanatory studies ................................................................................................................ 43

3.1.3 Exploratory studies ................................................................................................................. 44

3.2Philosophical Paradigms .................................................................................................................. 44

3.3 Research Philosophies ..................................................................................................................... 46

3.3.1 Quantitative philosophy ......................................................................................................... 46

3.3.2 Qualitative philosophy ........................................................................................................... 47

3.3.3 Selecting a suitable approach ................................................................................................. 47

3.4 Research Strategies ......................................................................................................................... 48

3.5 Data Collection Instruments ............................................................................................................ 50

3.6 Population and Sampling ................................................................................................................ 50

3.6.1 Population............................................................................................................................... 50

3.6.2 Sampling................................................................................................................................. 51

3.6.3 Judgmental sampling .............................................................................................................. 51

3.7 Data Analysis Techniques ............................................................................................................... 52

3.8 Validity and Reliability ................................................................................................................... 52

3.8.1 Validity ................................................................................................................................... 52

3.8.2 Reliability ............................................................................................................................... 53

3.9 Limitations ...................................................................................................................................... 53

viii

3.10 Ethical Considerations ................................................................................................................... 53

3.11 Conclusion ..................................................................................................................................... 54

CHAPTER FOUR: RESULTS AND FINDINGS ................................................................................ 55

4.0 Introduction ..................................................................................................................................... 55

4.1 Profile of the respondents ................................................................................................................ 55

4.1.1 Demographic Information of respondents .............................................................................. 55

4.2 Section B: Current Succession planning practice ............................................................................ 58

4.3 Section C: Succession planning challenges ..................................................................................... 68

4.4 Succession planning strategies ........................................................................................................ 69

4.5 Summary of findings ....................................................................................................................... 70

4.5.1 Current succession planning practice ..................................................................................... 70

4.5.2 Challenges facing succession planning .................................................................................. 71

4.5.3 Strategies to improve succession planning practice ............................................................... 71

4.6 Conclusion ....................................................................................................................................... 71

CHAPTER FIVE: DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS ...................... 72

5.0 Introduction ..................................................................................................................................... 72

5.1 The research .................................................................................................................................... 72

5.2 Conclusions ..................................................................................................................................... 72

5.2.1 Succession planning in banks ................................................................................................. 73

5.2.2 Challenges facing successful implementation of succession planning .................................. 74

5.2.3 Strategies to improve the practice .......................................................................................... 74

5.3 Recommendations ........................................................................................................................... 74

5.3.1 Board accountability .............................................................................................................. 74

5.3.2 Management Support and participation ................................................................................. 75

5.3.3 Succession Policy ................................................................................................................... 75

5.3.4 Strengthening regulatory compliance audits .......................................................................... 75

5.3.5 Human resources Management systems ................................................................................. 75

5.3.6 Performance appraisals: 360 degree ....................................................................................... 76

5.3.7 Training and Development ..................................................................................................... 76

5.4 Evaluation of research proposition .................................................................................................. 77

5.5 Limitations of study and areas of further research .......................................................................... 77

5.5.1 Limitations ............................................................................................................................. 77

ix

5.5.2 Areas of further research ........................................................................................................ 77

References ............................................................................................................................................. 79

APPENDICES ....................................................................................................................................... 83

x

List of tables

Table Description Page

Table 2.1: The VRIO Framework.......................................................................................22

Table 3.1: Banks in Zimbabwe............................................................................................51

Table 4.1: Demographic personal Information of respondents..........................................57

Table 4.2: Replacement of personnel in Executive positions..............................................58

Table 4.3: Succession planning...........................................................................................59

Table 4.4: Identification of Succession candidates............................................................60

Table 4.5: Developing internal candidates for succession.................................................61

Table 4.6: Incorporating Succession planning into Bank’s strategy..................................62

Table 4.7: Impact of Labour Act Amendments to Succession planning............................63

Table 4.8: Preservation of Institutional memory................................................................64

Table 4.9: Developmental Initiatives..................................................................................65

Table 4.10: Organisational Long term survival...................................................................66

Table 4.11: Overall rating of succession planning..............................................................67

Table 4.12: Succession planning challenges.......................................................................68

Table 4.13: Succession planning strategies........................................................................69

xi

List of Figures

Figure Description Page

Fig 1.1 PESTEG Analysis.................................................................................................4

Fig 2.1: Resource Based View of the Firm......................................................................20

Fig 2.2: Administration of Succession planning...............................................................26

Fig 2.3: The Seven Pointed star succession planning model............................................35

Fig 2.4: The Ohio talent tomorrow and beyond Succession planning model...................37

Fig 2.5: Conceptual Framework.......................................................................................40

Fig 3.1: The research Onion.............................................................................................42

Fig 4.1 Respondents’ level of Education.........................................................................55

Fig 4.2 Respondents’ professional background...............................................................56

xii

List of Abbreviations

AIDS Acquired Immuno Deficiency Syndrome

CEO Chief Executive Officer

CGRI Corporate Governance Research Initiative

ESAP Economic Structural Adjustment Programme

EU European Union

HRD Human Resources Department

GNU Government of National Unity

HIV Human Immuno Virus

HRM Human Resources Management

IMF International Monetary Fund

MD Managing Director

MDC Movement for Democratic Change

MFI Multilateral Financial Institutions

RBZ Reserve Bank of Zimbabwe

RBV Resource Based View

ROI Return on Investment

SP & M Succession Planning and Management

UN United Nations

USA United States of America

VRIO Value, Rarity, Imitability, Organisation

WB World Bank

ZANU PF Zimbabwe African National Union Patriotic Front

1

CHAPTER 1: INTRODUCTION AND BACKGROUND

1.1 Introduction

This chapter introduces the research study on the implementation of succession planning

process in the banking industry in Zimbabwe. It discusses the introduction, background to

the study, statement of the problem, research objectives, and significance of the study as

well as structure of the research.

While most organisations are quick to confirm that they have active succession plans in

place, it is the implementation effectiveness of their processes that warrant an analysis.

Although an organisation’s survival and long term prosperity can be attributed to quite an

array of factors, leadership stands out as a definite fundamental factor. Fayol (cited in Jarbou

2013), in his classic 14 points of management, elucidates that it is management’s

responsibility to ensure stability of tenure of personnel otherwise organisations will be ill

prepared to make necessary transitions. Succession planning assists with retention of

talented personnel through provision of developmental and growth opportunities so that staff

may not otherwise look elsewhere (Jarbou, 2013). This means planning for succession is a

very necessary activity to ensure fruition of strategic plans, human resources and other

organisational development plans and activities (Rothwell, 2010).

1.2 Background to the study

Due to the rapidly changing environments, succession planning could be a very fundamental

process in today’s organisation in order to preserve institutional memory, as well as ensure

organizational long term sustainability. It is a vital process whether the economy is good or

bad because no one situation remains permanently the same over time. Change is inevitably

the only constant. Organizations require talented employees who are skilled, highly adaptive

to changing economic environments and have a very good understanding of the company’s

strategic direction, cultural dynamics, vision and its mission.

The effects of the 2008-2009 global financial crisis did not spare the African continent and

for Zimbabwe the effects were quite calamitous as the country was already experiencing its

2

own localised financial crisis. According to Maunganidze (2013), this culminated into an era

of the worst economic and social crisis as most companies succumbed to viability

challenges. Like in other industries, the Banking sector lost a number of talented and

competent staff due to various reasons which included searching for greener pastures and

job stability. Needless to say, some banks lost quite valuable skilled personnel. The

turnaround time banks take to fill in a key vacancy is a reflection of the level of

preparedness of their human resources management systems, as well as their strategic thrust

in terms of succession planning and management processes. As popularly understood,

failure to plan is planning to fail. Mammat et al. (2007) postulate that failure to plan for

succession is a frequent cause of rapid organization deterioration and downfall. Finding a

suitable replacement for a key role could appear to be an easy task at face value if the

selection criteria are based on only qualifications and level of experience, but there may be

costs to be incurred in terms of finance, time and productivity if the replacement is sought

externally. De Juan (2003) cites the ability to foresee as a rare gift which can be developed

by adequate techniques. Building a sustainable talent pipeline of potential successors with

leadership capabilities and suitable culture fit is very necessary to mitigate risk of disruption

and discontinuity of business operations should any key staff departures take place.

Succession planning in banks, if implemented correctly, should endeavour to nurture

corporate entrepreneurship or intrapreneurship through recognition of high fliers, who may

view themselves as budding entrepreneurs, and doing the necessary developmental activities

to cultivate their loyalty and make them corporate warriors (Govender, 2010).

1.2.1 Succession planning in Zimbabwe’s banking Industry

According to Govender (2010), banks are an important source of working capital for

businesses and are catalysts of economic growth. The banking industry is characterized by

high volatility and stiff competition for competent and skilled personnel. Like any other

industry, the banking sector also faces the risk of untimely departures of critical employees

whether be it through retirement, ill health, dismissals, competition or even death. Nassor

(2013) emphasises the need to proactively find a suitable successor that can fill in a key

vacancy when it opens up since it is inevitable to stop employees from exiting the

organisation. The importance of succession planning cannot be under estimated; due to the

unpredictability of the banking industry, it is quite imperative to nurture and develop talent

from within due to issues to do with organisational culture as well as customer loyalty and

3

trust. A planned succession entails more than just filling in key positions but also involves

passing of a shared culture and vision. It facilitates continuity and change management. The

process of attracting, developing and retaining the best talent is not a once off event and may

take quite some time.

Gono (2014) asserts that forward looking succession planning is a critical ingredient of good

corporate governance. In light of this, the Reserve Bank of Zimbabwe vets all top bank

officials for qualifications, experience, appropriate track record and worthiness for their jobs

as an enforcement of good corporate governance measure. De Juan (2003), supports this

assertion as he postulates that succession prospect is one of the basic elements used to rate a

bank’s management. He further reiterates that if all banks were well managed then the only

reason for failure would be those due to economic or political factors. He stresses the role of

management as a major element in banking crises. It has been observed that most indigenous

banks struggle with management issues which impact on performance and return on

investment in the long run. Cases in point include Barbican bank, ZABG, Trust bank and

Kingdom bank, to mention a few.

Dessler (cited in Nassor, 2013) defines succession planning as an ongoing process of

systematically identifying, assessing, selecting and developing candidates who will fill the

key leadership positions to enhance performance. Furthermore, Rothwell (2010) defines

succession planning as a calculated effort by an organisation to ensure leadership continuity

in key positions. This may be necessitated by the fact that when experienced workers in

leadership roles unexpectedly leave the organisation, it results in an experience gap and a

glaring leadership void. However, despite the risk involved in not investing in this process,

organisations may purport to have succession plans in place, yet on closer investigations,

these plans may just be that. Plans. There may be no processes or activities whatsoever to

support the plans or the development of the ear marked talent. Miles and Dysart (cited in

Nassor 2013:2) point out that succession planning efforts are usually underdeveloped,

irregularly implemented and sometimes simply ignored. This study will endeavour to

unearth reasons why there may be lack of succession planning processes in such instances.

To analyse the implementation and effectiveness of succession planning in Zimbabwean

banks it will be worthy to find out the state of the current succession planning practice,

examine the challenges facing its implementation and discuss suitable strategies to counter

the challenges. Thereafter, it will be necessary to provide recommendations that the banks

can adopt in order to be able to practice succession planning effectively and successfully.

1.2.2 Business Environmental Analysis

In order to have a clearer understanding of the banking industry and validate the necessity of

analysing the effectiveness of succession planning processes in this sector, it is essential to

carry out an analysis of the business e

environment can be analysed through political, economic, s

global factors that affect a business. These factors create opportunities and threats

outcome of the analysis can assist in the appreciation of

Figure 1.1 below shows the major business environmental factors.

Figure 1.1: PESTELG ANALYSIS

Source: Adapted from http://www.strategicmanagementinsight.com/

Legal

Global



ss Environmental Analysis



carry out an analysis of the business environment in which banks operate. The business

d through political, economic, social, technological, ethical and

global factors that affect a business. These factors create opportunities and threats

ysis can assist in the appreciation of the research question under study.

Figure 1.1 below shows the major business environmental factors.

Figure 1.1: PESTELG ANALYSIS

http://www.strategicmanagementinsight.com/ [accessed 27/10/2015]

Macro environment

INDUSTRY

Political

Economical

TechnologicalEthical

4





nvironment in which banks operate. The business

ocial, technological, ethical and

global factors that affect a business. These factors create opportunities and threats, hence the

research question under study.

[accessed 27/10/2015]

Economical

Social

5

a) Political Factors

The banking sector in Zimbabwe had been basically dominated by traditional foreign banks

till the mid 90’s when liberalization of the sector promoted the establishment of indigenous

banks. Prior to the year 2000, Zimbabwe was regarded as the bread basket of Africa with

agriculture being the stronghold of economic activities while mining and manufacturing

were complements. Politically, the environment was stable and the country was enjoying

strong economic growth due to the confidence and support of the international community.

The government of Zimbabwe directed the banking industry’s regulatory authority, the

Reserve Bank of Zimbabwe (RBZ). The banking industry benefitted from lines of credit

from international financiers like the World Bank (WB) and International Monetary Fund

(IMF).

However, the political outlook in Zimbabwe took a really drastic turn in the year 2000

owing to the chaotic land reform programme which coincided with the creation of the

Movement for Democratic Change (MDC) political opposition party. The way the land

reform programme was administered did not go down well with the international

community. This resulted in the imposition of sanctions on the country by the European

Union (E.U) and also United States of America (U.S.A) as a way of registering their protest

against the Zimbabwean government’s policies regarding the land issue.

Multilateral Financial institutions (MFIs) imposed financial sanctions on Zimbabwe in the

following manner; suspension of Balance of Payment support, suspension of technical

assistance, suspension of voting and related rights by IMF and declaration of ineligibility to

access fund resources (RBZ, 2007). Needless to say, this turn of events negatively impacted

on the once robust banking sector which lost access to foreign lines of credit and also

diminished chances of forming strategic alliances with foreign banks due to the uncertainty

surrounding the political landscape of the country. The international community maintained

that the sanctions were not economic while the government argued otherwise and this

resulted in the isolation of the country from the rest of the world and caused a complete

collapse of relations (Chanaka, 2014). United Nations’ special envoy, Anna Tibaijuka

(2005) contended that in as much as these sanctions were not specifically economic in

nature, they adversely affected the Zimbabwean political environment and contributed to the

rift of the national and international media.

6

With the quality of life for the generality of Zimbabweans deteriorating from bad to worse,

coupled with political violence, the ruling political party, ZANU PF, compromised with the

competing M.D.C to form a Government of National Unity (G.N.U) in 2008. This did not

yield much in terms of improving the international community’s view of the country’s

political risk but at least it brought about the dollarization of the economy and curbed the

hyperinflation which was bedevilling the country. The RBZ lost its lender of last resort

status as it could no longer print money. Even though dollarization came as a relief, banks

had to devalue their customers’ savings and investments at an exchange rate that wiped

away any value of what the clients had entrusted to the banks. With this, the banking

industry lost quite a huge scale of customer trust and loyalty. It also was at high risk of

losing its best talent too as the future and prosperity of the industry appeared to be bleak

especially more so with the introduction of black empowerment policies. These policies are

meant to address colonial injustices but the question would remain on the nature of impact

on succession in banks if indigenization laws were to be applied to this industry. The

banking industry needs highly skilled and talented management and staff to be able to

neutralize external threats brought about by political interference on the macro fiscal and

monetary policy.

b) Economic factors

The Economic and Structural Adjustment Programme (ESAP) which the Government

embarked on in 1991 with the support of WB and IMF triggered the deterioration of the

economic situation in the country. Although the programme’s intended purpose was partly

to deregulate and liberalise the financial sector, the World Bank (2010) concedes that the

anticipated benefits such as growing the economy and creating jobs did not materialize but

the opposite actually became the reality. Furthermore, the imposition of targeted sanctions

on Zimbabwe adversely affected the weak and vulnerable people far more than the intended

targets. Kofi Anan (2000) described these sanctions as a misdirected apparatus used to inflict

undue pain on a multitude of ordinary people who do not deserve it. With a shrinking

economy and soaring unemployment levels, the population became poorer which impacted

negatively on the banking industry. Additionally, banks were failing to cope with

customers’ daily cash requirements due to the effects of hyper inflation and devaluation of

the Zimbabwean dollar.

7

From the period 2003 to 2015 many indigenous banks succumbed to liquidity and

management challenges and collapsed. These banks include Royal, Trust, Time, Barbican,

Genesis, Century, Allied, AfrAsia and Tetrad. The banks that survived had to take measures

to manage their exposure to risk. Indigenous banks have folded due to a compound of

factors amongst which mismanagement tops the list. One of the reasons can be attributed to

failure of founders to handover bank operations to professional managers. Poor succession

planning and management (SP and M) may also be a contributing factor. Running a bank

demands requisite skill and expertise therefore it may be imperative to separate ownership

and management as banks handle public funds; it is key to manage them professionally and

efficiently.

c) Social factors

The political and economic situation impacted negatively on the people of Zimbabwe and

the effects spilled into the social domain. The economy suffered so much in the period 2000-

2009 and this caused many companies to close down due to viability challenges which were

induced by the harsh operating environment. Resultantly, quite a number of job losses were

experienced and the labour market was awash with raw college graduates who could not be

absorbed into the dwindling formal markets. This situation gave birth to the informal sector

which initially traded in illegal activities such as foreign exchange dealings; an activity

termed “burning money” in street lingo. The country was subjected to brain drain as its

skilled people emigrated to neighbouring countries and abroad in search of greener pastures.

In as far as corporate social programs were concerned, companies could not even afford to

sponsor expected programmes due to a difficult economic environment.

As if this was not enough, the HIV and AIDS pandemic was also taking its toll on the same

productive age group. According to the United Nations (UN) report (2009) an estimate of

14% of the population was infected with the virus as at 2007. Given this bleak background,

companies that invest in tools like succession planning and nurture loyalty in their employee

retention strategies would less likely suffer as much risk as those that do not proactively

manage their human resources succession. The banking industry in Zimbabwe has also been

adversely affected as its talented personnel also ventured outside the country’s borders in

search of better prospects amidst the turmoil of uncertainty clouding the country’s economic

direction.

8

d) Technological factors

Zimbabwe, being a third world country, has been lagging behind on the technological front.

However, with the inception of the government of national unity (G.N.U) in 2008 and the

slight improvements in economic outlook, the small number of companies that was revived

embraced technological advancement, with a few exceptions such as Zimpost and Telone

succumbing to technological adjustment failures. The banking sector innovated around

mobile and online banking in a bid to delight its customers. Some banks upgraded their

Automated Teller Machines (ATMs) in an effort to improve service quality and security

features and also to be in line with international standards. On the human resources

management front, some banks invested in management and payroll systems in order to

manage their employees better. Noteworthy though is the fact that most have not considered

investing in succession and employee management tools as yet probably due to inadequate

familiarization of the benefits of these management tools and also financial resources

constraints. The banks’ human resources management tools could still be technologically

lagging behind in terms of adequacy.

e) Ethical factors

In today’s business environment, banking plays quite a critical role in framing public policy.

According to Saunders (2003), ethics refers to the appropriateness of one’s behaviour in

relation to the rights of those who become the subject of one’s work or are affected by it.

Although banks play a key role in the supply and movement of money, how they use this

money is not irrelevant from a moral and ethical perspective. In the same vein, their

selection of human resources, and particularly those that anchor leadership roles, should be

done ethically and the selected must play a stewardship role in execution of their duties.

All banks have codes of ethics in place and are expected to abide by them. The country

recently launched Zimcode-a national document of corporate governance-which is a

refreshing starting point and a step in the right direction.

f) Legal factors

The other factor is the legal environment that banks operate in. The banking sector is

regulated by the RBZ whose responsibility is regulation and supervision of banking

institutions in Zimbabwe. The RBZ endeavours to ensure that banks conform to its

prudential guidelines as well as statutory regulations. As part of their risk based supervision

9

and surveillance duties, the central regulatory body carries out compliance audits on banks’

human resources policy adequacy pertaining to succession of key roles. Banks are expected

to adhere to the Banking Act guidelines when carrying out their operations.

g) Global factors

Global factors affect succession in a notable way. Traditional foreign banks like Barclays,

Standard Chartered and Stanbic are controlled at group level and have their Head offices

outside the country. These banks are expected to adhere to international standards of

banking and this sets a standard for indigenous banks as well since customers will choose

banks that offer the best in terms of quality, service delivery and even security of deposits.

Succession planning of the traditional foreign banks is not necessarily restricted to

Zimbabwe only but goes beyond into regional and international assignments. Talent

management and succession planning therefore become very important at macro level since

the world has become a global village and having employees who understand the strategic

direction of the banks they work for; its vision, mission, values and culture dynamics create

a sustainable competitive advantage. Global transfers of employees are a common pattern in

international banks. Kutcher, Jones and Widener (cited in Nassor, 2013) assert that having a

workforce alone is not sufficient for a firm to derive a sustainable competitive advantage,

rather a firm must utilise their workforce as a strategic resource to sustain competitive

advantage.

1.3 Statement of the Problem

The world is now a global village and distance-induced inhibitions are no longer an

important aspect to consider when moving jobs or careers. Bankers are under immense

pressure everywhere due to management failures, as well as risk of losing their best brains to

competitors and other industries. In Zimbabwe, the pressure could be especially more so

with the amendments made to the Labour Act after the 2015 landmark Supreme Court ruling

that empowered employers to issue three months employment termination letters to

employees. This prompted some employers to abruptly dismiss their employees by giving

them three months’ salary in lieu of notice.

10

The banking industry is a specialised one, with a unique kind of culture and is expected to

uphold a high level of integrity, transparency and continuity since it trades in public funds

and assets. It is a regulated industry. Although most banks may indeed have succession plans

in place, it is the depth of these plans and the effectiveness of their implementation that this

study seeks to analyse. Continuity and smooth flow of business processes should not be

threatened by departures of key talent hence it is imperative for banks to have talent pools

where they can draw fit-for-role replacements from anytime. The question of whether or not

an employee should know that they are valued talent to the organisation may also arise given

the current state of affairs that enable employers to dismiss workers on three months’ notice.

The need for succession planning will always be there because departures are unpredictable

and inevitable given the demographic parameters of decreasing life expectancy forecasts.

This study seeks to analyse the extent to which Succession planning is effective in ensuring

key skills’ retention and leadership continuity in the Banking Sector in Zimbabwe. For

senior positions of Chief Executive Officer, Chief Finance Officer, Chief Operating Officer,

Chief Information Officer (C-suite) and other senior leadership roles, the Reserve Bank of

Zimbabwe (RBZ) prescribes a certain set of person specifications required for such

positions. More often than not, it has been observed that many banks fail to field a suitable

person from within when an unplanned departure occurs and may have to scout for a key

role successor externally.

The RBZ carries out a periodic compliance audit on bank operations and succession

planning is regarded a key human resources compliance issue. This raises the question of

whether banks do this exercise in order to be compliant or it is a process they ought to

regularly practice to meet their organisations’ short and long term strategic goals. It also

raises the question of whether succession planning is regarded a necessary process at all in

today’s banking organisations or it may only be an issue of complying with the regulatory

requirements. It can be observed that the country’s banking Industry has declined mainly

due to poor succession planning at leadership level, particularly among the indigenous

banks. Most indigenous banks have liquidated and some have gone under judicial

management. This has resulted in customers’ loss of confidence in banks.

11

1.4 Research Objectives

The overall objective of the study is;

To critically analyze the implementation process of succession planning practices in

Zimbabwe’s banking industry.

The Specific Objectives are;

i. To find out the current succession planning practices in the banking sector in

Zimbabwe.

ii. To examine the challenges that banks in Zimbabwe could face in implementing

succession planning best practice.

iii. To recommend suitable strategies that help improve the succession planning practice

in Zimbabwean banks.

1.5 Research Questions

The main research question is;

How effective is the implementation of the current succession planning practices as a human

resources management tool in banks in Zimbabwe?

The sub questions the research seeks to address are;

1. What is the current state of succession planning practice in Zimbabwe’s banking

industry?

2. Are there any prevalent challenges facing the effective implementation of succession

planning practice?

3. What strategies can be implemented to improve succession planning practice in

banks in Zimbabwe?

12

1.6 Research Proposition

The research proposes that Succession planning is not being fully utilized as a talent

management tool in Zimbabwe’s banking Industry. The assumption is that although plans

may be in place, they are not fully implemented and evaluated.

1.7 Significance of Study

Succession planning studies have been widely carried out in the Asian and European

countries and literature reveals that a few studies on the subject matter have been carried out

in developing countries. Notable succession planning studies carried out on banks in Africa

were done by Govender (2010), South Africa and Nassor (2013), Tanzania. In Zimbabwe,

succession planning studies have been carried out on family owned businesses and Small to

Medium Enterprises due to the fact that most of these are owner managed and in the event of

the passing on of the owner, the business also goes into demise. One such study was carried

out in 2008 by Maungandze.

Banks are owned by many shareholders, have various stakeholders and deal with public

funds. This study endeavours to fill in a gap in literature regarding the effectiveness of

succession planning practice in the banking industry in Zimbabwe in the midst of massive

job losses and company viability challenges against the volatile nature of banks’ business

operations and the unpredictable operating environment. It seeks to unearth why succession

planning is not being proactively implemented in some instances and whether or not it is

actually on the priority list of human resources workforce planning activities. This is against

the fact that a company’s competitive advantage is usually sustained by its calibre of human

resources.

The banking sector is a critical component of the country’s overall economic performance as

they deal with depositors’ funds and assets. It may be essential for banks to identify posts

that are critical for success, categorize talented people who can fit into them and disseminate

the best way to satisfy future requirements. Recent collapses of banks, particularly the local

ones, can be partly attributed to failure of founders to handover to professional managers.

This research is important to the student as she endeavours to contribute to the body of

knowledge in order to minimise such management discontinuity problems.

13

It is also important to the banking sector in that recommendations will be suggested on

strategies to strengthen effectiveness of succession planning as well as benefits that come

with proactively undertaking succession planning in this era of increased competition. The

researcher anticipates that this study will be a resource for Human Resources Practitioners,

as well as company executives, who spearhead and own the processes of succession

planning in their organizations. The study aims to incite other researchers to discuss the

concept of succession planning practice in other sectors as well as the relevancy of this

subject area as a tool of Talent Management in business.The research findings are also

expected to raise some human resource succession planning pitfalls which should be

addressed by banks in Zimbabwe. The researcher expects this study to benefit the various

stakeholders in the banking industry.

1.8 Limitations

Time constraints may be encountered given the limited research period. Some financial

institutions may be reluctant to divulge some information relating to their Human Resources

management processes and policies. The researcher will utilize her college contacts and

associates to establish networks that will lead her to her targeted participants. The researcher

will work with findings obtained from banks that agree to participate in the study and

synthesize with secondary data available in the public domain.

1.9 Scope of study

This study will focus on the banking industry in Zimbabwe and research will be carried out

on fifteen operational banks. The population would be limited to human resources

practitioners, senior and middle level management in the banking sector. The study will not

go into detail concerning other talent management tools. Findings obtained from the target

population will be recommended to the banking industry in Zimbabwe.

1.10 Dissertation Structure

This dissertation comprises of five chapters which are arranged as follows;

14

a. Chapter 1: Introduction and Background

This chapter introduces the research problem under study. It contextualizes the background

to the study area, problem statement, research objectives and research questions. The study

concludes with the limitations of the study, scope of the study and significance of the study

to the academic community, bankers and human resources practitioners.

b. Chapter 2: Literature Review

The chapter focuses on reviewing existing literature pertaining to the subject matter under

study. It outlines some of the relevant works that have been done by other researchers and

writers, streamlining the work against this study’s objectives and purpose. Applicable

theories will also be discussed.

c. Chapter 3: Methodology

The chapter focuses on the research methodology which the researcher adopted in carrying

out the researcher. An analytical framework of the research design that was selected will be

provided as well as the reasons why a single case study approach was preferred. The main

sources of data to the research, data collection processes and data analysis will be discussed.

d. Chapter 4: Results and Findings

The chapter will focus on discussing the findings obtained from banks. The collected data

will be presented, analysed and examined in order for inferences to be drawn from it. This

chapter will provide answers to the research questions articulated in chapter 1 as well as

validate the objectives raised.

e. Chapter 5: Conclusions and Recommendations

The chapter will consider theory and field findings and conclude the research study.

Recommendations will be offered and areas of further research will be highlighted.

1.11 Summary

The chapter introduced the research study on the analysis of the implementation of

succession planning practice in the banking industry in Zimbabwe. An overview of the

15

subject matter under study including its direction and scope were discussed. Three distinct

objectives were determined and in line with these objectives appropriate questions were also

posed. The objectives seek to establish the current state of succession planning, find out the

challenges facing the implementation of the practice and discuss the strategies that can be

applied to improve the implementation of the practice. The following chapter will

concentrate on reviewing available literature in line with the study objectives and also touch

on relevant theories to substantiate the research proposition and answer the research

questions.

16

CHAPTER TWO: LITERATURE REVIEW

2.1 Introduction

This chapter reviews relevant literature on succession planning. It will firstly consider the

theoretical framework underpinning succession planning initiative. Secondly, the study

variables identified as objectives in chapter 1 will be discussed in depth and a relationship

amongst them will be established. Thirdly, applicable research models will be discussed as

well as identified research gaps. Lastly, the chapter will provide a conceptual framework for

the study and a summary.

The literature review will analyzethecurrent state of succession planning practices in the

banking industry; consider the challenges that inhibit the successful implementation of the

process and the strategies that can be used to mitigate or lessen the challenges. Additionally,

recommendations found in literature to improve the effectiveness of the succession planning

process will be discussed.

2.1.1 What is Succession Planning?

According to Rothwell (2010), succession planning is a deliberate and systematic effort by

an organisation to ensure leadership continuity in key positions, retain and develop

intellectual and knowledge capital for the future and encourage individual advancement.

Succession planning is not an event but a continuous process that improves with practice,

commitment and adjustment. Hedum (2010) views succession planning as a critical

leadership tool for ensuring organizational growth and continuity by eliminating substantial

gaps in institutional memory, knowledge, and leadership through strategic placement of key

personnel. Armstrong (2011) further posits that succession planning is a process of assessing

and auditing the talent in the organization in order to answer fundamental questions of

whether there is sufficient and good enough bench strength and also if they have the right

skills and competencies for the future.

Effective organizations are expected to proactively create the future by investing resources

such as time, money and intellectual capacity towards planning and management of

succession in order to ensure continuity of their leadership talent. Nguwi (2014) reiterates

17

that succession planning is a process that starts with proper recruitment and selection of

employees, development of their skills and preparing them for advancement through

mentorship and coaching. This suggests that Organizations are expected to select and recruit

high potential people who can feed into talent pools in preparation for key future manpower

requirements. This standpoint is supported by Noe et al (2008) who define succession

planning as more than just a backup or replacement plan to provide qualified successors.

They view it as a valuable tool that guarantees a continuous supply of competent and

talented skill. Succession planning is an ongoing process that demands constant revisiting,

maintenance and updating in order to keep abreast with current market changes as well as

future requirements in terms of workforce and particularly leadership planning.

In as much as succession planning may appear to be biased towards satisfying organizational

requirements (Govender 2010), it also promotes individual development thereby assisting

employees with fulfillment of their self actualization goals (Flynn 2014). A good succession

planning process creates congruence between organizational requirements and individuals’

needs. Flynn (2014) adds that succession planning helps address skills shortages, improve

diversity, and foster employee engagement. Without Succession planning the wealth of

knowledge amassed by staff over the years would be thrown away (Govender 2010).

Succession planning has been defined by various writers and the bottom line that comes out

clearly is that it is a proactive, deliberate and systematic process that organisations choose to

undertake in order to promote continuity through development and retention of key talent

and preservation of cultural values and intellectual property. It is a strategic and risk

mitigation measure that helps minimize disruption and discontinuity of business operations;

it helps companies to avoid promotion of employees due to crisis and equips organisations to

make planned and informed decisions in the selection and nurturing of talent that can feed

into specialised, management and leadership roles.

The succession planning process should not be done secretly or mysteriously. Effective

communication is very important throughout the process (Mehraban and Mahomed 2011).

This succession process should be the initiative of management but for it to be effective it

requires the avid support of the Chief Executive Officer, participation of line management,

active facilitation by Human Resources department and the effort of everyone in the

organisation. The identified talent should be trained, developed, mentored and coached

through exposing them to acting opportunities, rotational assignments, projects as well as

management and leadership development programs. By doing all this, succession planning is

18

then differentiated from replacement planning which favours quick fixes and is purely done

for risk aversion and crisis management reasons (Rothwell, 2010).

It will be of no use to try to talk a leaving key employee into staying when they state that

their reason for leaving is to look for growth opportunities. They could be leaving because

they may have noticed a trend that the company is always filling vacant key roles with

external people. More often than not it may be because succession management is not being

practised proactively and systematically. Organisations need to strategize to motivate and

connect their employees in order to create competitive advantage and achieve profitability

(Mehrabani and Mohamad, 2011). There are of course instances where bringing in new

blood into the organisation pays huge dividends, especially where brand equity is at stake or

where there is urgent need to drastically change organisational culture or shock the system.

Perhaps a mix of new appointments and internal promotions may be the best approach for

some organisations. However, proactively practising internal succession planning has quite a

number of benefits.

Rothwell (2010) asserts that succession planning is important in the long term success of a

company and this is reinforced by Govender (2010) who states that leadership transitions

have a rippling effect in business, thus affecting the entire organisation’s continuity, talented

employee retention, client retention and returns on investment. There are some aspects of

business which cannot be imitated easily and can be quite rare like quality of personnel,

organisational culture, relationships and even employee commitment. These may add a

unique value especially if a firm organises itself in such a way that enables exploitation of

such advantages. The banking industry is homogenous if looked at as a sector, but the

individual banks are heterogeneous. This can be attributed to a number of factors amongst

which human resources management processes is one key element. Ability to attract, select,

recruit skilled personnel and then develop, nurture and retain them is one key component of

strategic human resources management that really matters. It is even more important if a

firm endeavours to religiously practice succession planning process from the initial point of

recruitment because the very same people who were fed into the system will constitute the

future management and anchor the leadership echelons of the organisation. Investment in

succession planning is something that modern business leaders are recognising as an

important strategy in achieving the long-term vision of the organisation.

19

Succession planning enables proactive identification and grooming of high potential

candidates for future key positions ensuring that the return on investment (ROI) made in

each identified employee is realised in the form of organisational preparedness, confidence

and capability. This gives the organisation a good chance to be competitive and face the

future with confidence (Govender, 2010). Today’s rapidly changing environments expose

organisations to unpredictability and uncertainty which may cause instability in business

operations hence the need for organisations to rely on their most important asset: their

people (Mehrabani and Mohamad, 2011). Hills (2009) sums it up by defining succession

planning as doing all you can to ensure you have the right people in the right jobs at the right

time. He further goes on to categorize succession planning as a smart talent management

strategy that helps an organisation to ensure it has the required skills on hand to respond to

rapidly shifting sands that make up today’s business environment.

2.1.2 Succession planning as a Talent Management tool

Talented people possess special gifts, abilities and aptitudes which enable them to perform

effectively (Armstrong, 2011). These people have a special bundle of abilities, skills,

knowledge and unique style which makes them a major corporate resource. Cannon and

McGhee (2011) define talent management as a process of identifying, managing and

developing such people now for the future. Some scholars are of the view that Talent

management is anchored on the assumption that there is potential in every staff member and

any developmental approach should aim to release it. Armstrong (2011) indicates that talent

management may simply refer to succession planning and management development

activities which aim to identify, retain and nurture the key competencies that the

organisation requires. In her research,Chikumbi (2011) explains that talent management

focuses on the individual with undisputable abilities and skills. It also focuses on processes

that seek out these special employees that need to add value to improve the bottom line.

Succession planning cannot be effective without proper talent management and talent can be

measured through performance management of employees. The best way to compare

employees’ level of skill and expertise at what they do is through objective performance

management; other ways of measuring employees’ capabilities and level of aptitude usually

tend to be very subjective in nature and may adversely affect an organisation’s management

and leadership quality in the long run.

Society for Human Resources Management (cited in Kim, 2006) describes talent

management as the implementation of integrated strategies or systems designed to increase

workplace productivity by developing improved processes for attracting, developing,

retaining and utilising people with the required skill and aptitude to meet current and fut

business needs. Talent management is the notion of bundling in action which provides a

basis for Succession planning. Succession planning is based on information about people

which would have been gleaned from talent audits, employee performance and po

reviews as well as supply and demand forecasts.

2.2 Theoretical Framework underpinning Succession Planning

There are various theories that support succession planning amongst which there is the

Resources Based View of the firm. Figure 2.1 below dep

supports succession planning practice.

Fig 2.1: Resource Based View of the Firm (RBV).

Source:Barney and Hesterly

advantage: Concepts and cases

The Resource Based View of the Firm (RBV) is a management model of firm performance

that focuses on the resources and capabilities controlled by an organisation as sources of

competitive advantage (Barney and Hesterly

and intangible assets a firm controls and uses to envision and implement its strategies.

Capabilities are complex bundles of individual talents, attitudes, skills and accumulated

knowledge exercised through organisational processes and unique styl

Capabilities

Resources

Distinctive

competencies


t as the implementation of integrated strategies or systems designed to increase


retaining and utilising people with the required skill and aptitude to meet current and fut



which would have been gleaned from talent audits, employee performance and po

reviews as well as supply and demand forecasts.

2.2 Theoretical Framework underpinning Succession Planning


Resources Based View of the firm. Figure 2.1 below depicts the resource based view which

supports succession planning practice.

Fig 2.1: Resource Based View of the Firm (RBV).

and Hesterly(2012). Strategic Management and Competitive

advantage: Concepts and cases.



competitive advantage (Barney and Hesterly, 2012). The resources are defined as t



knowledge exercised through organisational processes and unique styles that enable a firm

Distinctive

competencies

Competetitive

AdvantageCost/Differentiation

Advantage

20


t as the implementation of integrated strategies or systems designed to increase


retaining and utilising people with the required skill and aptitude to meet current and future



which would have been gleaned from talent audits, employee performance and potential


icts the resource based view which

(2012). Strategic Management and Competitive



2012). The resources are defined as tangible



es that enable a firm

Cost/Differentiation Advantage

21

to coordinate activities and take advantage of the resources it controls. The knowledge basis

of capabilities makes them firm specific and resides in the collective memory of the

organisation’s personnel. A firm’s resources and capabilities are categorized into four

clusters namely financial, physical, human and organisational resources.

The fundamental principle of the RBV is that a firm derives competitive advantage by

primarily utilising the bundle of resources and capabilities at its disposal. This competitive

advantage is achieved when several resources that seem to be homogenous are bundled in a

heterogeneous combination. In this vein, managers matter because they possess the ability to

create firm differences even if they are working with resources that are rather common. Two

critical assumptions underpinning the RBV are that resources should be heterogeneous and

immobile. Resource heterogeneity implies that all firms are not the same and similarly

different firms may have different resources. Resource immobility is when it proves to be

costly for firms to acquire or develop certain resources and capabilities they do not have as

some resources cannot spread easily from firm to firm. These assumptions mean that a firm

can have valuable resources that other firms find costly to imitate, therefore making them

rare, which enables them to derive sustained competitive advantage. This explains why some

firms outperform other firms even if these firms are competing in the same industry.

To determine whether a resource is likely to be a source of competitive advantage, the RBV

uses an internal tool of analysis called VRIO framework. The VRIO framework stands for

four questions that should be asked about a resource or a capability to determine its

competitive potential: Value, Rarity, Imitability and Organisation (VRIO).

The VRIO framework

Table 2.1 overleaf presents the VRIO Framework, an internal analysis tool of RBV.

22

Table 2.1: The VRIO Framework

Valuable

?

Rare? Costly to

Imitate?

Exploited by

Organisation?

Competitive implications Economic

implications

No No

Yes

Competitive Disadvantage Below

normal

Yes No Competitive Parity normal

Yes Yes No Temporary Advantage Above

normal

Yes Yes Yes Sustained Advantage Above

normal

Source: Barney and Hesterly(2012).

a) Value

When considering the human resources and capabilities of an organisation as a valuable

source of competitive advantage, which validates importance of succession planning

practice, it is essential to determine whether the calibre of employees and their skills enable

a firm or bank to exploit an external opportunity or neutralize an external threat.

b) Rarity

The question of rarity creates competitive advantage if a resource is not controlled by

numerous other firms. If a firm has valuable but common resources and capabilities, it can

gain competitive parity, which increases its probability of survival. According to Barney and

Hesterly (2012), firms that have valuable and rare resources and capabilities gain first mover

advantages as they are strategic innovators with ability to conceive and engage in strategies

that other firms cannot because they lack the relevant resources and capabilities.

c) Imitability

For a firm with valuable and rare resources to sustain the competitive advantage, firms that

do not possess the same should face a cost disadvantage in obtaining and developing them as

compared to firms that already possess them. In such a scenario, a firm’s resources can be

said to be inimitable.

23

d) Organisation

Given that the RBV states that a firm’s competitive advantage depends on the value, rarity

and imitability of its resources, the question of whether that firm is well organised to exploit

the full competitive potential of these resources becomes the differentiating factor. The

components of a firm’s organisation include; formal reporting structure, management

control systems and its value chain system. All these constitute complementary resources

and capabilities as they only work well in combination with other resources to enable a firm

to realise its full potential for competitive advantage. If all these conditions hold, the firm’s

bundle of resources can assist it in sustaining above average returns.

The RBV logic holds that firms that are able to use human resources management practices

to develop socially complex human and organizational resources are able to gain

competitive advantage over firms that do not engage in such practices like succession

planning and other enabling processes.

2.3 Succession planning

2.3.1 Current Practice

Succession planning should invariably consist of more than simple identification of a list of

potential successors to senior positions. It has to be more strategic by developing pools of

talent at various levels of the organization, as well as taking a longer term approach to

development (Flynn 2014). Ideally, succession plans ought to be linked to competencies and

potential for both current and future business needs. Kotter (2003) is of the opinion that it is

important to identify employees with leadership potential early in their careers and foster the

skills and competencies that will be required to stretch and develop them over the course of

time. Conger and Fulmer (2003) assert that companies succeed in developing enduring

bench strength by approaching succession planning as more than just a mechanical process

of updating a list. They state that it is more effective to expose identified successors to a

variety of jobs and bosses using techniques such as job rotation, special assignments and

action learning which pulls together a group of high potential employees. Good succession

planning should categorize the identified talent according to their level of readiness to

succeed key posts in the event of departure, retirement or death of the incumbent. This

24

exercise enables appropriate interventions to be applied to ensure readiness of the identified

successors. Succession planning practice has to go beyond just having a plan in place but

should run the full process of integrating with other human resources supporting activities

(Rothwell, 2010;Nassor, 2013; and Flynn 2014).

a) The Kenyan Experience

Nassor (2013) carried out a study on succession planning among commercial banks in

Kenya and found out that succession planning is a once off event in the majority of banks

and it only takes place when a Chief Executive is about to exit the organisation. Lack of

succession planning in the majority of Kenyan banks made it impossible for them to name a

suitable successor to a key role within a year and the Board of Directors was found to be the

most influential in CEO succession process. These findings render succession planning

ineffective because the practice is handled as a replacement activity to avert a crisis, rather

than a proactive and developmental long term process. Avanesh (2011) posits that good

succession planning is not just looking at who is next in line for a fit but looking at people

early in their careers and disseminating what kind of training they may need to become good

leaders.

b) Succession in American banks

Rhonemus (2013) postulates that a thoughtful succession planning process keeps the mission

of the bank on track and forces accountability and talent assessment at least once or twice a

year. He cites the $250m Midwest Community bank as an example of good succession

planning because it managed to hire a CEO on board before the outgoing CEO’s retirement,

which ensured a seamless transition with no loss of continuity. In their article, Conger and

Fulmer (2003) cite Bank of America’s Ken Lewis as an exemplary CEO because when he

took over as Chairman and CEO, he took ownership of the talent management process and

holds business units heads personally responsible for meeting employee development

objectives within their units. The CEO influences the strategic direction of an organisation

therefore in the same vein his ownership of and commitment to practices like succession

planning process will have a positive and far reaching impact in organisational

sustainability.

25

2.3.2 Scope of Succession planning

In the 1980s, many studies centred on CEO succession practices and attendant issues. In the

1990s, succession planning expanded its focus from CEOs alone to include executives and

other key positions. At the beginning of the 21st century, succession planning and

management include a much broader spectrum of positions (Kim, 2006). While many

previous studies focus more on CEO succession, the spectrum of succession planning should

be wide enough to include middle management roles as well as specialised roles rather than

focus on only the upper echelons roles. Most organisations currently practise succession

planning at the senior level, but for the plan to be fully successful, it must be organised at

middle level management as well in order to ensure accountability for participation

(Avanesh, 2011).

Govender (2010) contends that a major increasingly important factor in today’s ever-

changing economy is the imminent retirement of an entire skilled, talented and

knowledgeable generation of leaders. Organisations are also being faced with a major

concern regarding the disparity of retiring age groups and the diminishing population of

younger talent to replace them. As a result of this, succession planning is becoming more

and more a distinct strategic imperative. With succession planning, the skill and knowledge

of an employee departing or nearing retirement is transferred to existing employees in the

organisation and the loss to the organisation of the training and development investment in

the outgoing employee will be minimal.

According to an article written by Nyakazeya ([email protected] [23/11/2015]), CEOs

tend to be less value-adding to entities the longer they stay with an organization and can

even end up being liabilities in terms of the need to be more innovative in a changing

environment. This then means it is important to renew leadership frequently which makes

succession planning a necessary process and practice. Systematic and proactive CEO

succession will open up gaps in lower positions if this succession is done

internally.Therefore there is need for succession planning and leadership development

strategies from management positions upwards.

Haworth (2005) observes that succession planning is a process that calls for organizations to

understand their business; know their people, create trust, take time to think, spot potential,

seek win-win approaches, let go, create opportunities, allow mistakes, invest in the future,

use creativity, take risks, encourage employees and es

Flynn (2014) proposes 6 steps to follow in the administration of succession planning. These

are presented diagrammatically

Figure 2.3: Administration of Succession planning

Source: Flynn, (2014).

Understanding strategic direction

succession planning, how and if it is done. Succession planning starts with

understanding an organisation’s strategic direction. A solid foundation in

understanding a company’s mission, vision, core values and an analysis of its

strengths, weaknesses, opportunities and threats helps a firm to identify competitive

advantage and enables a clear grasp of its goals and ultimately day

Grounded knowledge of what an organisation is trying to accomplish saves time and

also results in a better end product.

Embrace a Competency/Potential approach

needed to perform certain roles and these include knowledge, sk

recommended to start by identifying the competencies or potential needed to realise

the organisation’s vision and establish the requirements of each key role.

Competency profiles can be developed by reviewing job descriptions and

interviewing people current in the roles

competencies or potential a key role requires makes it easier to assess candidates and

help them develop in critical areas. These competency profiles can be used in the

Understand strategic direction

Develop potential successors

win approaches, let go, create opportunities, allow mistakes, invest in the future,

use creativity, take risks, encourage employees and establish a coaching culture.


are presented diagrammatically below in figure 2.2.

: Administration of Succession planning

Source: Flynn, (2014).

Understanding strategic direction allows for assessment of the current state of



nderstanding a company’s mission, vision, core values and an analysis of its


advantage and enables a clear grasp of its goals and ultimately day

ed knowledge of what an organisation is trying to accomplish saves time and

also results in a better end product.

Embrace a Competency/Potential approach- Competencies refer to qualifications

needed to perform certain roles and these include knowledge, sk




erviewing people current in the roles, as well as other stakeholders. Knowing the



Understand strategic Embrace

competetency/Potential approach

Identify and assess

Develop potential Manage knowledge transfer

26

win approaches, let go, create opportunities, allow mistakes, invest in the future,

tablish a coaching culture.


allows for assessment of the current state of



nderstanding a company’s mission, vision, core values and an analysis of its


advantage and enables a clear grasp of its goals and ultimately day-to-day activities.

ed knowledge of what an organisation is trying to accomplish saves time and

Competencies refer to qualifications

needed to perform certain roles and these include knowledge, skill and ability. It is




as well as other stakeholders. Knowing the



Identify and assess candidates

Evaluate

27

hiring process, identification of development opportunities for staff and also

measuring employee performance.

Identify and assess candidates- Identification of people with the requisite

competencies, or can acquire them, can be done once competency profiles for key

positions in the organisation are in place. Thereafter the identified candidates’

potential can be assessed using various tools. Reliance on the immediate supervisor’s

feedback alone will not be enough hence systematic process for assessing candidates

based on an array of perspectives and information sources will be required in order to

minimise subjectivity. Options can include periodic performance reviews,

interviews, 360 degree feedback, psychometric tests or examinations. Once

identification and assessment of employers has been done against the competencies

required, developmental activities can then be tailored accordingly.

Develop potential successors- The identification and assessment exercise provides

the roadmap for learning development which encompasses formal training, job

rotation, job enlargement, job enrichment, role acting opportunities, challenging

stretch assignment, coaching and mentoring. Education, experience and exposure are

important aspects on this step. Providing the succession employees to targeted

exposure, training or experience helps them acquire or build on competencies

required to assume more senior or alternative roles.

Manage knowledge transfer- Knowledge transfer may take time, so it is best to

ensure a departing employee has sufficient time to mentor and share knowledge with

the incoming ones. There is need to encourage an employee nearing the end of their

career, or planning to leave, to share tacit knowledge which may not be documented

anywhere but is inbuilt in an employee and refined through years of exposure and

experience. Tacit knowledge transfer can be facilitated by providing junior

employees opportunities to work alongside the more senior ones. Exit interviews for

employees leaving the organisation can also be used to capture critical information.

However, an employee can depart anytime without pre warning so it is best to also

practice cross functional training such that for every role in the organisation there is

28

one other person who knows enough to fill it on an emergency basis or to easily train

a replacement.

Evaluate- For succession planning to be effective, there is need to evaluate and

monitor key indicators and adjust accordingly. These key indicators may include;

vacancies, external/internal hire ratios, bench strength, performance ratings and

employee engagement.

a. Vacancies- Effective succession planning should result in fewer vacancies at

any given time, and a decrease in the time to fill them.

b. External/Internal hire ratio- Effective succession planning should enable

you to fill a higher number of key positions from within.

c. Bench strength- “Bench strength” represents the ratio of key positions with

no internal replacement to the total number of key positions. Effective

succession planning should maximize the number of internal replacements

available for all key positions.

d. Performance ratings- Monitor the performance ratings of employees who

are new to key positions. Employees should be able to meet performance

targets early into starting a new position if succession planning was

thoroughly done.

e. Employee engagement- Use satisfaction surveys and rates of turnover as a

general check on organizational health. Ask questions specific to succession

planning or the developmental process to illuminate the employee

perspective.

2.3.3 Implementation of Succession planning

Evidently, the succession planning process requires dedication and commitment and requires

time for it to become effective. Various scholars seem to agree on the fact that the

succession planning practice is not being fully implemented in most organisations in various

industries. The process seems to stall as soon as the identification of potential successor

candidates is done and nothing else happens thereafter. Saslow and Lacker (2014) advise

that succession is more time consuming, riskier, and more expensive when carried out

following a departure rather than in advance. Avanesh (2011) contends that for any industry

that thrives on the dynamics of constant change, success comes to those who have the

29

foresight and the ability to counter unexpected challenges. Literature reveals that succession

planning is currently practised at the senior level and also it is only going as far as just

having “plans” in place with no means to consider and measure outcomes.

It is important to find out the challenges that organisations face in their efforts to fully

implement their succession plans and discuss the strategies they can use to counter or

minimise these challenges that agitate the implementation of fruitful proactive succession

planning. According to Rothwell (2010), 70% of successions planning programs fail in the

long term due to implementation problems. The successful implementation of succession

plans hinges on the formula below:

Succession implementation success= Motivation x Accountability x Visibility x Follow-

through (http://www.emmerichfinancial.com/strategic-planning/succession-

plan/[24/01/2016]).

There has to be sufficient motivational levels to promote and sustain accountability of set

succession planning goals. Communication of relevant information should be visible enough

to all interested parties in order for the succession planning initiative to bear fruits.

Evaluation all the way through every step of the succession planning process will give clear

indications of how well the implementation is going and strategies to remedy any

shortcomings may be employed.

2.4 Challenges facing Succession planning

While just creating a succession “plan” may be fairly simple, Flynn (2014) points out that

the real benefit comes from the planning exercise and from the related activities engaged in

as a result. Although succession planning needs to be aligned with the business objectives of

the company, the process has its fair share of hurdles. Nassor (2013) cites unwillingness of

top managers to mentor middle management as one of the biggest succession challenges.

This challenge is also brought up by Aberdeen Group (2006) who postulates that for

Succession planning to be a companywide initiative the management needs to play an active

role in ensuring it becomes a more cohesive initiative. This is because management may fail

to envision the future of the organisations they work for and view their successors as a threat

to their present existence. Atwood (2007) posits that if top management does not support the

succession program it will most probably fail no matter how well thought out and Singer and

30

Griffith (2010) add that leadership must see the planning and development of the program as

a necessary endeavour that requires dedicated resources and goal oriented attention.

Most organisations fail to ensure that ownership is at executive level of the organisation and

leave the ownership to human resources departments (HRD). Of course HRD plays a key

role in facilitating and guiding the process but succession development should be the

executives’ and particularly the CEO’s ownership because he or she spearheads the

company’s vision. According to Avanesh (2011), the CEO must be an avid supporter and

active participant, line management must own the process with Human Resources playing a

supportive role. Also, the general staff must support the efforts and the activities of

succession planning practice, of which they can only be motivated to do so if their

management and leadership take ownership of the program.

Other challenges include; Inadequacy of robust human resources systems and policies,

misconception that succession planning is a process for the HR department only, failure to

close performance gaps, too much focus on planning versus outcomes, assuming success at

one level guarantees success at a higher level, the mirror effect, lack of communication

which breeds ignorance, failure to integrate succession planning with other human resources

processes, lack of budget and treating succession planning as a tick box compliance issue

rather than a necessary practice.

a) Integrating succession planning with other HR processes

Succession planning process becomes effective if it is integrated with other human resources

processes and also if human resources systems and policies are robust and adequate enough

to support it (Flynn 2014). The down side is that the succession planning endeavour is often

taken in isolation, yet it requires the support of other HR processes like recruitment,

learning, development, performance appraisal, job rotation as well as coaching and

mentorship. All these processes help in the development and grooming of the identified

talent. Creation of talent pools becomes successful if these other processes are interwoven

with succession planning practice.

b) Succession misconceptions

Another challenge is that management may perceive that an employee’s success at his or her

current level guarantees success at a higher level but this may not be the case. Once there is

this kind of perception, it is easy to overlook the much needed developmental activities that

31

the identified talent should go through before they match the competency requirements of a

key role. In many cases employees are promoted to their incompetency simply because of

such subjective assumptions by management. Related to this challenge is the mirror effect

problem whereby people rely on a natural tendency to choose those most like themselves

and earmark them for key roles. This behavior deprives organizations of the diversity

required for future needs.

c) Succession planning and outcomes

Organizations are prone to focus too much on planning with little regard to outcomes. Plans

look very good on paper but do not produce successful outcomes because there is lack of

recognition that succession planning is not episodic but an ongoing effort whose outcome

should be defined and measured. Without defining and measuring outcomes key

stakeholders will not be able to quantify nor appreciate the value of succession planning.

Key outcomes can include the percentage of critical vacancies filled with internal promotion

or lateral movements versus external hires and percentage of vacancies filled from talent

pools (http://docplayer.net/1316243-Succession-planning-your-bank-s-future-

leadership.html).

Literature reveals that lack of budget hinders succession planning efforts. However,

Michelson (2006), points out that succession planning does not require an extensive budget,

equipment, staffing, or resources but it does require a change of thinking. Development

activities must be a variety of methods which do not require extensive funding for example

job rotation, job enrichment, role acting capacity. Insufficiency of HR technology to support

applications like succession may of course substantiate the lack of budget challenge.

The findings of Larcker and Saslow’s 2014 survey reveal that most organisations treat

succession planning as a tick box compliance issue due to the scrutiny of regulators and

other market participants that emphasize the risk management and loss minimisation aspects

rather than value creating elements of succession planning. This implies that succession

planning is not done deliberately, but the plans are only in place in order to be compliant.

This one time planning mentality has been noted as a key barrier in achieving organisational

success with succession planning (Rothwell, 2010). Many respondents who participated in

the Larcker and Saslow’s survey (2014) understood the exercise in terms of its ability to

reduce future downside risk, rather than producing shareholder value benefits from the

identification and grooming of strong and appropriate leadership.

32

2.5Strategies to conquer Succession challenges

Although companies recognise the importance of a thorough and rigorous succession

process, most fail to create one (Flynn, 2014; Larcker and Saslow, 2014). The purpose of

succession planning is to ensure a bank has the executives and key talent with the skills and

depth of experience required to meet short and longterm operational and strategic plans.

Rhonemus (2012) envisions that the competitive advantage in the years to come will go to

those banking institutions that have the foresight to plan for their future talent needs to meet

critical challenges of technology and market movements. To avert a crisis of leadership, it is

imperative for management to seriously consider their mission plans to determine whether

they have the people in place to achieve these goals and objectives. A review of literature

reveals quite a number of recommendations for organisations to make the succession

planning program a success.

a) Cultural integration

Hedum (2010) advocates for integration of succession planning program into organisational

culture in order to avert leadership transition crisis in the near future. This is supported by

Larcker and Saslow (2014) who view the inability of companies to appreciate the

importance of succession planning as a cultural problem because most companies do not

have honest and open discussions about executive performance nor do they allocate

sufficient time to the process of identifying and grooming successors. They also recommend

organisations to foster a culture of executive development and avoid a “cloned culture’ by

identifying candidates with diverse backgrounds. Larcker and Saslow (2014) further explain

that culture actually drives how successful succession is and point out that it is the CEO who

creates the culture and the board members are custodians of that culture. Open and

transparent cultures promote productive succession plans and discussions as opposed to

those cultures that are not feedback based. People actually contribute more if they know

what rung they are on.Therefore, it is best to make succession planning transparent given

that employee contracts are now based on performance rather than loyalty or seniority. Good

succession planning depends on the willingness to differentiate individual performance and

a corporate culture in which the truth is valued more than politeness(Conger and Fulmer,

2003).

b) Succession planning ownership by leadership

33

For Succession planning efforts to be successful, there is greater need for the CEO to take

ownership of the program and be an avid supporter of the initiatives. He or she is the

custodian of the company vision. Senior and line management should be held accountable

for the processes of the program, hence the need to include succession planning

responsibility in their job descriptions for them to appreciate its importance (Davilia and

Pina-Ramirez, 2015). According to Govender (2010), although the succession planning

process has to be actively led and supported by the CEO, if managers do not actively

identify potential successors then they are lacking the ability to delegate, develop and groom

their subjects for succession. To reinforce accountability, Sims (2014) states that regular

talent review meetings should identify and document development action plans for

individuals and include who is responsible for each action item and when it should be

completed.

It is recommended to ascertain whether a succession process is appropriate for a banking

organisation’s size and complexity and also if it is consistent with the bank’s vision and

culture (Rhonemus, 2013). A strategy to make succession planning effective could be to turn

organisational charts into a developmental map in order to establish which skills or what

functions are necessary to have in order to fill in the key positions. It is fundamental to

create succession charts for each key position and put readiness codes for instance: 12-24

months, 24-36 months, more than 36 months. Succession planning should be taken beyond

organisational charts and use it as a comprehensive change management tool that helps the

organisation identify gaps in talent and fill them more effectively (Hedum 2010).

In the CGRI 2014 report of senior executive succession planning and talent development,

Larcker and Saslow recommend the following strategies to make the succession planning

process a success;

Consistency. Succession planning should be treated as a continuous practice

whereby management and board of directors prepare transitions at any time and at

multiple levels throughout the organisation. This exercise should include the CEO’s

direct reports and other critical positions.

Assign ownership and roles. An independent chairman or experienced director

from outside should have primary responsibility and other board members, CEO,

senior executives and support staff should be assigned specific roles and held

34

accountable for measurable results. This arrangement also promotes good corporate

governance in the organisation.

Cast a wider net. Due to the fact that an organisation and its strategy are constantly

evolving, the skills needed to run the organisation in the future might not be the same

as they are presently. The board of directors and senior management should look

broadly through the ranks of the organisation to ensure they are fostering a diverse

set of talents and skills to take the organisation forward.

Get strategic assistance and enlist the help of third party coaches and mentors when

necessary. Organisations should endeavour to understand their relative strengths

compared to their peers. The best organisations seek to learn from the practices of

others through conducting market surveys on practices of other corporate and

integrate the ones that are best suited to their current structure and situation.

Professional third party coaches bring an outside perspective and a degree of

objectivity to the development process of succession.

Connect CEO and senior executives’ succession plans with coaching and

internal development and let these programs strategically support each other.

Mapping succession to the pipeline of internal executive talent, identifying

deficiencies in internal talent and designing and implementing development plans to

overcome these is a sure way of ensuring a robust and reliable succession plan.

Jarbou (2013) further advises banks to conduct training on the succession planning concept

for senior management to develop an understanding for it and also have a documented

definite guide for succession planning that directs senior management.

It has been observed that succession planning practice in banks, and indeed other industries,

barely goes beyond the planning phase. Successors may be identified but no developmental

interventions are set in motion to prepare and groom them for the roles they are picked for.

The current status quo can only be improved by overcoming the challenges discussed above

and making use of the various strategies recommended in order to bridge the glaring gap that

is making the succession planning efforts ineffective. It could really be beneficial if

succession planning efforts run the full developmental course.

35

2.6 Succession planning Models

There is no single agreed model for succession planning and similarly, there are no hard and

fast rules governing which model an organisation should adopt or follow, since no two

organisations are exactly the same in terms of size and complexity. There are various

succession planning models formulated by different scholars in a bid to provide a framework

for best succession planning practice. Some of these include Rothwell’s “Seven pointed star

model” and Ohio’s “talent tomorrow and beyond succession planning model”. These are

discussed below.

2.6.1 The Seven-Pointed Star Model for Systematic Succession Planning

Rothwell (2010) developed the famous seven pointed star model for systematic succession

planning and management. Figure 2.3 overleaf shows the model that details the steps to

follow in order to achieve systematic succession planning and management in an

organisation.

Fig 2.4: The Seven-Pointed Star Model for Systematic Succession Planning and

Management.

Source: Rothwell, William. J. (2010a, p83).

36

Rothwell (2010) explains the steps as follows;

1. Make the commitment- The Organisation’s decision makers should deliberately

commit to the succession planning as a systematic process and establish a program.

Activities involved span from assessing existing problems and practices to

benchmarking succession practices in other organisations. The commitment is

strengthened by training and counselling managers on succession planning.

2. Assessment of present work/people requirements prepares advancement of

individuals in a way that is firmly grounded on work requirements. Decision makers

need to clarify where key leadership positions exist, as well as elucidate key

individuals who would be exceptionally difficult to replace due to their unique

talents, special knowledge or other reasons.

3. Appraisal of individual performance is important in order to establish how well

individuals are performing in their present roles since the assumption of succession

planning programs is that individuals should be performing exceptionally well in

their current jobs for them to qualify for advancement.It is necessary to establish an

inventory of talent to ascertain what human assets are already available.

4. Assessment of future work/people requirements prepares future leaders to cope

with future requirements and organisational strategic objectives. Decision makers

should align future work/competencies requirements to organisation’s strategic

direction.

5. Assessing future individual potential measures how well individuals are prepared

for advancement. It is a question of finding out the talents they possess, and how

well those talents match up to future work requirements. It is therefore necessary for

the organization to establish a future oriented performance appraisal process to

assess future individual potential.

6. Closing the developmental gap requires the organization to establish a continuing

leadership development program in order to cultivate future leaders internally.

Decision-makers may also explore

methods of meeting succession needs.

7. The Succession Planning program must be subjected to

assess its effectiveness. The results of evaluation should then be used to make

continuous and incremental program improvements and also to maintain a

commitment to systematic succession planning practice.

2.6.2 The Ohio’s talent tomorrow and beyond succession planning model

Another succession model is the Ohio’s talent tomorrow and beyond succ

model that is illustrated in Figure 2.4

Fig 2.5: The Ohio’s talent tomorrow and beyond succession planning model

Source:http://www.das.ohio.gov/Portals/0/DASDivisions/HumanResources/LPD/pdf/Succe

ssion_Planning_Mgrs_Toolkit.pdf

This Ohio model prescribes 5 steps to ensure succession planning is successful.

involves identification of key positions that can potentially impact business operations in the

event of sudden or even planned departure of the incumbent. At this stage it

create a key position inventory and evaluate the impact of each position in ensuring the

organisation meets its strategic goals and objectives. It is best to categorise position

inventory data in terms of; specialized knowledge, retirement

attrition. Prioritise succession planning

Step 2 entails the assessment of employees against critical competencies that the identified

critical roles require.It is also important for management to identify success factors for

critical positions to assess position impact and vacancy risks. The primary function of

assessing leadership talent is to determine whether there are one or more succession

step 1

Identify critical positions

Step 2

Assess leadership potential

makers may also explore alternatives to traditional promotion

methods of meeting succession needs.

The Succession Planning program must be subjected to continual evaluation


and incremental program improvements and also to maintain a

commitment to systematic succession planning practice.


Another succession model is the Ohio’s talent tomorrow and beyond succ

model that is illustrated in Figure 2.4 below.

: The Ohio’s talent tomorrow and beyond succession planning model

http://www.das.ohio.gov/Portals/0/DASDivisions/HumanResources/LPD/pdf/Succe

ssion_Planning_Mgrs_Toolkit.pdf[Accessed 06/11/2015]

Ohio model prescribes 5 steps to ensure succession planning is successful.


event of sudden or even planned departure of the incumbent. At this stage it



inventory data in terms of; specialized knowledge, retirement vulnerability and risk of

attrition. Prioritise succession planning

entails the assessment of employees against critical competencies that the identified


tical positions to assess position impact and vacancy risks. The primary function of


Step 2

Assess leadership potential

Step 3

Develop and retain talent

pool

Step 4

Capture,

transfer knowledge

37

alternatives to traditional promotion-from-within

continual evaluation to


and incremental program improvements and also to maintain a


Another succession model is the Ohio’s talent tomorrow and beyond succession planning

: The Ohio’s talent tomorrow and beyond succession planning model

http://www.das.ohio.gov/Portals/0/DASDivisions/HumanResources/LPD/pdf/Succe

Ohio model prescribes 5 steps to ensure succession planning is successful. Step 1


event of sudden or even planned departure of the incumbent. At this stage it is important to



vulnerability and risk of

entails the assessment of employees against critical competencies that the identified


tical positions to assess position impact and vacancy risks. The primary function of


Step 5

Measure, monitor and

Evaluate Success

38

candidates ready to successfully assume the role and responsibilities. Avoid relying on one

person for bench strength for multiple critical positions when identifying competencies.

Step 3 outlines the development strategies for identified talent pool based on required

business needs and leadership potential. Development of strategies for each member of the

“talent pool” should be based on information gathered during the assessing of leaders (Step

#2) process. To be effective in developing future leaders, key assignments, developmental

feedback, mentoring, coaching, formal classroom training, and professional memberships

must be made available. Design and implement career development strategies. Using a

career development plan helps track, monitor and facilitate development discussions with

the succession candidates.

Step 4 ensures key institutional knowledge and information is transferred appropriately to

successors. Knowledge transfer strategies such as Job shadowing, job rotation, on the job

training and job enlargement may be used.

The 5th and final step calls for measuring, evaluating and monitoring the succession

planning program. It is recommended that the succession planning efforts be measured and

monitored regularly to ensure effectiveness. It is important to establish metrics that can

measure succession planning and these metrics can be measured on a quarterly and/or

annual basis.

2.6.3 Succession planning case study

AfrAsia Zimbabwe Holdings Limited (Former Kingdom Financial Holdings Limited)

The researcher used to work for AfrAsia Zimbabwe Holdings Limited and this is her

observation.

Kingdom Financial Holdings was founded by Nigel Chanakira in 1997. It later merged with

Mauritius based Afrasia Bank in 2009 and by 2011 Afrasia Bank had acquired the majority

of Stake (65%) which prompted the company to change its name to AfrAsia Zimbabwe

Holdings Limited.

The company’s organisational structure was such that the role of the Managing Director

(MD) had a deputy role. This means there were effectively two Managing Directors.

39

When the substantive Managing Director tendered his resignation in March 2013, naturally

it was expected that the deputy MD would substantially assume the role but this did not

happen. The bank went for almost a year with the deputy MD holding fort while the Bank

was looking for a substantive MD. The institution hired Mr TineyiMawocha as its new MD

in January 2014 and the deputy MD reverted back to his shadow position. In March 2014 the

newly hired MD resigned and the deputy MD assumed the acting role of MD while the bank

looked for a substantive.

Ten months after Mr Mawocha’s departure the bank appointed Mr HashmonMatemera as

the new MD and again the acting MD reverted back to his deputy position.

After these attempts to substantially fill in the vacant Managing Director post with external

appointments, the question arises as to why the deputy Managing Director was not appointed

substantive Managing Director in the first place after departure of the then MD. The bank

lost time and money from the whole exercise of scouting for a substantive managing director

since the resignation of Mr Francois Molife in March 2013 up to January 2015. What were

the challenges hindering the deputy MD’s promotion? Could it perhaps have been a strategic

intent on the part of the board to bring in fresh blood? This may possibly be indicative of

loopholes in the implementation of succession plans and it can potentially undermine

investor confidence, customer trust and performance of the bank.

2.7 Research gaps

Extensive studies have been carried out on succession planning. These touched on

challenges of succession planning (Mwemezi, 2011) Succession planning as way to

minimize staff turnover rate in South Africa’s Nedbank (Govender 2009), effectiveness of

succession planning in law enforcement authority (Erasmus, 2009), succession planning

among commercial banks in Kenya (Nassor, 2013) and various such studies touching on

family owned businesses, for example, Maunganidze’s thesis on succession planning and

business survival for family controlled businesses (2008). This study is biased more towards

management and leadership succession, with a bid to ensure organisational sustainability

and leadership continuity in banks operating in Zimbabwe. It seeks to explore how the

succession planning program can help minimise management and leadership problems in

these banks by analysing the current state of the practice, discussing the challenges that

40

militate against its successful implementation and recommending strategies to make the

practice a success. The researcher chose the banking industry because this sector thrives on

competitiveness, loyalty and trust that customers bestow on the calibre of people managing

and leading the banks. The choice was also influenced by the fact that the researcher’s career

developed while she was working in the banking industry.

However, the researcher is aware of the need to consider technical succession in order to

meet knowledge transfer needs in specialised roles, as well as transitioning from strategic

succession to tactical daily succession (Rothwell, 2010). Succession planning aims to ensure

development of competent future management and leadership, avert risk associated with

unexpected loss of individuals to death, disability, or sudden resignation, multi skill the

identified talented employees through exposure, training and experience. However, this may

not be enough. Succession planning should further focus on linchpin positions, jobs that are

essential to the long term health of the organisation, regardless of whether they are

managerial, leadership roles or not (Conger and Fulmer, 2003). It would be beneficial to find

out the benefits and effectiveness of intensifying succession planning and management (SP

& M) initiatives to jobs lower than management level, technical or specialised jobs, as well

as extending this practice to the contingent workforce (Aberdeen Group, 2006).

2.8 Research Conceptual Framework

Fig 2.5: Conceptual Framework

Fig 2.5 below depicts a diagrammatic summary of the research.

Source: Developed by the Researcher, 2015.

Current state of

Succession

planning

Challenges

facing

Succession

Planning

Effective

Succession

planning

Strategies to counter

challenges/improve

Succession planning

41

Current state of succession planning

This component provides an analysis of the succession planning as currently practised and

highlights the loop holes inherent in the implementation of the process. It seeks to unearth

the extent to which the planning goes in terms of process administration.

Challenges of succession planning

For succession planning to be effective it has to be properly and fully implemented. The

challenges facing succession planning implementation are examined and discussed.

Strategies to improve succession planning

Strategies to overcome or neutralise the challenges that hinder successful implementation of

succession planning practice are considered and discussed in this component.

Effective succession planning

This component of the framework encompasses how an effective succession plan should

function. Models that depict ideal succession planning systems and processes are discussed.

2.9 Chapter Summary

The chapter reviewed appropriate literature to analyse the current state of succession

planning in banking and other organisations. It discussed the challenges banks face in the

implementation of prosperous succession planning and also looked at the strategies found in

literature to improve and make succession planning a worthy investment that can be

effective in organisational and leadership continuity. An appropriate theory underpinning the

importance of succession practice was discussed, models of succession planning were

selected, research gaps were highlighted and the researcher’s conceptual framework was

developed. The subsequent chapters will concentrate on comparing the literature information

and actual field findings in order to recommend the way forward.

CHAPTER THREE: RESEARCH MEHODOLOGY

3.0 Introduction

This Chapter explains how the research was developed and conducted in order to address the

research objectives and the problem statement outlined in Chapter One. Research

methodology focuses on the research process and the kind of tools and procedures to be used

(Poisat, 2006). The aim of the research was to analyze

planning practice in the banking industry in Zimbabwe. The study particularly sought to find

out the challenges banks face in effecting succession planning best practice and ways to

overcome these challenges in order t

major research question of this study is how effective is the implementation of current

succession planning practice as a human resources management tool in Zimbabwe’s banking

industry. The analysis was p

not being fully utilised as a talent management tool in Zimbabwe’s banking industry.

The structure of this chapter was

Lewis and Thornhill (2009). This Chapter also looked at the limitations in this research as

well as research ethics and credibility of data gathered. Below is figure 3.1 which shows key

aspects to consider when carrying out research.

Fig 3.1: The Research Onion

Source: Saunders, Lewis and Thornhill, A. (2009)




the research process and the kind of tools and procedures to be used

The aim of the research was to analyze the implementation of the succession



overcome these challenges in order to improve on the effectiveness of the process. The



industry. The analysis was premised on the research proposition that succession planning is


structure of this chapter was aided by the research ‘onion’ adapted from Saunders,

(2009). This Chapter also looked at the limitations in this research as


aspects to consider when carrying out research.

Fig 3.1: The Research Onion

and Thornhill, A. (2009)

42




the research process and the kind of tools and procedures to be used

the implementation of the succession



o improve on the effectiveness of the process. The



remised on the research proposition that succession planning is


aided by the research ‘onion’ adapted from Saunders,

(2009). This Chapter also looked at the limitations in this research as


43

3.1 Research Design

According to Saunders et al. (2009), a research design is an overall plan of how the

researcher will go about answering the research questions. Yin (2003) further explains that a

research design is the sequential logic that links the practical data to the study’s research

questions and eventually to its conclusions. A case study design was preferred for this

research in an effort toanswer the research questions and achieve the stated objectives. This

design is suitable when a case is representative (Yin 2003). The succession planning process

is one of the human resources management tools in the banking industry in Zimbabwe. In

designing research, there are mainly three research purposes that a researcher may utilise

and these are descriptive, explanatory and exploratory. These will be briefly described.

3.1.1 Descriptive studies

According to Robson (cited in Saunders et al, 2009:140), the objective of descriptive

researchis ‘to portray an accurate profile of persons, events or situations’. Descriptive

studies are meant to provide answers to who, what, where, when, why and how questions.

The researcher knows beforehand what has to be studied and where to look for the solution.

The advantage of descriptive studies is that they may be conclusive and confirmatory and

they may use structured or unstructured questions. The downside is that more research may

be required as this type of research seeks to answer a research question and not necessarily

to test a hypothesis.

3.1.2 Explanatory studies

Explanatory studies seek to establish the causal relationship between variables (Saunders et

al, 2009). The main objective is to test hypothesis in order to confirm or disconfirm an

available theory. Explanatory studies are compatible with both quantitative and qualitative

research approaches. They are confirmatory and conclusive as they concentrate on the cause

and effect relationship between variables. However, it is important to ensure the study

variables are clearly defined if one is to utilize this research purpose.

44

3.1.3 Exploratory studies

An exploratory study is valuable when a researcher intends to seek new insights, find out

what is happening, assess phenomena in a new light or obtain precise understanding of

nature of a problem (Robson, 2002). An exploratory study may develop a hypothesis but

does not seek to test it. Usually, exploratory studies are conducted at preliminary stages of

decision making and seek to provide answers to research questions. Such studies are

discovery oriented and speculative, such that they often need further research. The variables

involved are usually, although not always, highly ambiguous, with open ended or semi-

structured questions.

This research made use of the exploratory design in order to bridge the gap between the

succession planning as currently practiced and succession planning as should be practiced in

the banking industry in Zimbabwe. This choice was influenced by the flexibility and

adaptability to change of this research design. The study starts from the broad perspective by

analysing the current state of succession planning and narrows down to analysing the

challenges involved and then to making recommendations on how the challenges can be

curbed and on how the process can be improved to achieve best practice. Adams and

Schvaneveldt (cited in Saunders et al., 2009) argue that,although exploratory research is

flexible in nature, it does not imply absence of direction, but simply indicatesthat research

flows from broad to narrow as it progresses.

3.2Philosophical Paradigms

Saunders et al., (2009) explain that research philosophy relates to the development of

knowledge and the nature of that knowledge. They further posit that the research philosophy

a researcher adopts contains important assumptions about the way in which she views the

world and these assumptions will underpin the research strategy and the methods chosen as

part of that strategy. Research philosophy is influenced by the view of the relationship

between knowledge (ontology) and the process to develop that knowledge (epistemology).

Ontology deals with the nature of reality, it is concerned with whether reality is objective

(factual) or subjective (feelings, attitudes) in nature. Epistemology concerns what constitutes

acceptable knowledge in a field of study (Saunders et al., 2009). Mouton (1995) suggests

that in the final analysis, one has to examine each case before drawing any conclusions

45

about the respective roles of epistemological and ontological assumptions and the

methodological and technical level.

There are basically three main types of research philosophies namely the positivist, the

interpretivist and the realist. Positivism is usually associated with natural sciences and is

deductive in nature. It involves empirical testing of hypothesis and makes use of quantitative

research methods like experiments and surveys. According to Saunders et al (2009) this type

of approach is objective, value free, deductive and normally uses quantitative data. For

credible data to be produced only phenomena that is observable should be utilised. The

positivist philosophy depends on large samples and involves highly structured data

collection and analytical procedures. Although it is objective, a major disadvantage of this

philosophical paradigm is its rigidity and lack of feeling when it comes to issues that require

understanding of human perceptions, and behaviour. It is not suitable for social science.

The interpretivist philosophy conjectures that human phenomena are basically distinct from

natural phenomena (Babbie and Mouton, 2012). It assumes that the social world is too

complex to be assessed based on defined principles or laws as is done in physical science

since this discards other rich insights into such a complex social world (Saunders et al.,

2009). This paradigm, also known as the phenomenological philosophy, seeks to view the

study through the eyes of the people being studied and aims to interpret human behaviour

rather than predict or explain it. This is achieved through use of qualitative research methods

such as unstructured interviews and discourse analysis to exploretheperceptions and

construction of reality of the selected sample of people in organisations (Saunders, 2007).

The merits of this paradigm include flexibility in terms of changing research direction and it

is very useful in understanding social phenomena since it seeks to facilitate understanding of

how and why questions (Saunders et al, 2009). The disadvantages of this paradigm are that

data analysis may be quite difficult and there may also be researcher bias and subjectivity.

The realist paradigm is associated with mixed methods or triangulation whereby one

combines the quantitative and qualitative research methods in conducting research. In as

much as this philosophical paradigm attaches value to social reality (interpretivist) it also

concurs with the positivists’ approach which holds that phenomena should be scientifically

and objectively studied.

The researcher chose to utilize the interpretivist paradigm because the study is based on

qualitative data. This philosophical paradigm is epistemological in natureas it advocates for

46

the necessity to understand the differences between humans as social actors (Saunders et al.,

2009: 129). Even though this philosophy is generally perceived as less credible, the

researcher reckons that it is more informative to engage the targeted people through one to

one interviews in order to gain an understanding ofhow they perceive the world, interpret

and rationalise their daily actions (De vos et al., 2013). Reality is contextual and relative

hence the researcher’s choice to use the interpretivist paradigm. It is essential to understand

underlying issues regarding the succession planning practice and the better way is to engage

people who are knowledgeable about it, as the findings could provide new useful insights.

3.3 Research Philosophies

Research can be conducted by making use of either qualitative (inductive) or quantitative

(deductive) approaches (White, 2012). De vos, Strydom, Fouche and Delport (2012) explain

that quantitative and qualitative paradigms are the two common approaches to research. A

research may be done using a blend of the two approaches, but Silverton (2000), argues that

these two approaches are often evaluated differently and views quantitative approach as a

more superior approach because it is value free. However, good qualitative data helps the

researcher to get beyond initial conceptions and generate or revise conceptual frameworks

(Hurmerinta-Peltomaki, 2004).

3.3.1 Quantitative philosophy

Quantitative research involves collection of numerical and statistical data which will then

be sorted, classified and measured in an objective manner. This approach provides

summaries of data that support or refute generalisations made about the phenomena under

study. As postulated by White (2000), quantitative research is an iterative process involving

evaluation of evidence, as well as refining and testing theories and hypotheses.Unlike

qualitative researchers, quantitative researchers try to remain detached from research

participants as much as possible in order to draw unbiased conclusions (De vos et al., 2012).

According to Denzin and Lincoln (2005), measurement is the only means to numerically

quantify observations in investigating causal relationships or associations. Although

quantitative methods are ideally suited for finding out who, what, when and where, they are

inappropriate for the collection of behavioural data (Govender 2010, Saunders et al., 2009).

47

3.3.2 Qualitative philosophy

According to Muhammad , Muhammad and Muhammad (2008; 35) qualitative studies are

suitably utilised in understanding and describing the world of human experience. The

qualitative approach uses a small number of individuals,usually thirty or less, who are

carefully selected. It is an unstructured research methodology that aims to produce

theoretical insights into behaviour, motivations and attitudes (Wilson 2006). Leedy and

Ormrod (2005; 140) state that qualitative studies arefundamentally used to describe,

understand and answer questions about thecomplex nature of phenomena basing on the

participants’ point of view. Qualitative methods allow one to precisely and sequentially

follow events in a way that allows one to establish possible relationships between the events.

Researchers who choose qualitative approach anticipate to accurately interpret meanings of

phenomena by means of describing and decoding the phenomena occurring in normal

contexts. According to Creswell (2007; 57), qualitative researchers tend to collect data in the

field at the site where the participants experience the problem under study. Babbie and

Mouton (2012), assert that qualitative researchers prefer to utilise categories and

conceptsthat participants use,rather than reverting to abstract theoretical constructs in an

effort to identify with the actors or participants’meanings. This approach makes use of

inductive reasoning.

3.3.3 Selecting a suitable approach

Choosing a suitable research approach essentially depends on the type of information

required, nature of the research, availability of relevant resources and the context of the

study (Chanaka, 2014). Denzin and Lincoln (2005) posit that qualitative research produces

rich and detailed data that deepens understanding of the context whereas quantitative data

generates reliable probability-based data that is useful in explaining cause and effect

relationships.

In this research, the researcher deliberately chose the qualitative approach because of the

qualitative nature of case study methodology that was used as a strategy for inquiry. This

approach is appropriate for the phenomena under study, which focuses on human

perceptions within a social setting. It is thus the intention of the study to discover and reveal

the nature of the different opinions pertaining to the issue of succession planning as an

48

effective human resources management tool. One to one semi-structured interviews were

used to gather information from human resources executives and the various organisations’

senior management team.

Qualitative methods thrive on naturalness and they allow adjustments in the interaction

between the researcher and the respondent, which render them flexible in comparison to

quantitative methods (Mark et al., 2005). Qualitative methods usually use open ended

questions in order to allow the respondents to answer in their own words,thereby providing

comprehensive information, unlike the quantitative methods that are rigid and require

respondents to choose from the provided fixed responses (Chanaka, 2014). Qualitative

methods allow for manipulation of research direction due to their flexibility and also probing

for more information is possible, especially in one to one personal interviews.

3.4 Research Strategies

Yin (2003) informsthat there are several ways or strategies of undertaking research and these

include; experiments, surveys, case studies, histories and analysis of archival information.

Saunders et al. (2009) postulate various research strategies in their research ‘onion’ diagram

and these include experiment, survey, case study and archival research. Each of these

strategies has unique advantages and disadvantages, depending on the type of research

question, the control the investigator has over actual behavioural events and the focus on

contemporary, as opposed to historical phenomena (Chanaka 2014, p59).

Experiment

The purpose of experiments is to see the causal relationships between variables.

Experiments are often used in explanatory research where it is important to ascertain the

effect of change in one variable and the result in another. According to Babbie and Mouton

(2012) experiments involve taking action and observing the consequences of that action.

One advantage of experiments is that risk of extraneous variables (factors outside the

experiments but have influential potential) is minimized, although it is quite difficult to

completely eliminate the effects of the same.

49

Survey

According to Wilson (2006) a survey is a research strategy which allows the researcher to

make inferences about a population from which a sample of study subjects would have been

drawn. The survey method is suitable for economically collecting original data to describe a

population that is too large to observe individually and directly (Saunders et al., 2009). It

facilitates collection of the same information about all cases through use of standardised

questions which may be structured or unstructured. The objective is to get answers to

consistent questions. This method allows replication of studies in different settings to allow

comparisons. It is quick and cost effective. Saunders et al. (2009) assert that the survey

strategy is generally perceived as authoritative by people and is comparatively easy to

explain and understand. However, surveys tend to rely more on breath rather than depth and

focus is on quantity of data rather than quality.

Grounded theory

This strategy is problem focused, context specific and future oriented. It is a process of

continual re-examination of data in order to determine the research findings. Theory is

formulated from data gathered after certain serial observations. This theory is then grounded

in continual reference to the data.

Case study

Robson (cited in Saunders et al., 2009) defines a case studyasa strategy for doing research

which involves an empirical investigation of a particular contemporary phenomenon within

its real life context using multiple sources of evidence. According to Creswell (2007) a case

study is an investigation of a restricted system over a period of time through detailed data

collection involving several sources of information. Before conducting field research, it is

imperative for case study researchers to enter the field of study with prior knowledge of

applicable literature (Babbie and Mouton, 2013). The underlying principle of using the case

study strategy is to probe deeply and analyze intensively the phenomena with a view to

generalize to the wider population to which a unit under study belongs.

In this research, the researcher analyzed the current succession planning practice in banks,

considered the inherent challenges and possible strategies to overcome them. The case study

strategy allowed the researcher to holistically explore the research questions. The researcher

found this approach to be quite appropriate since the research involves a set of contemporary

50

events over which the researcher has limited control over (Yin, 2003). This strategy enables

respondents to express phenomena in their own words, since a combination of open-ended

and semi-structured questions will be used. This approach yields extraction of rich data

which is more informative. In as much as case studies allow for collection of credible

information, it has been noted that they provide little basis for scientific generalizations

(Thomas, 2004). Moreover, it is quite debatable to ascertain the extent to which casing can

produce meticulous data and produce findings of high validity. Nevertheless, Saunders et al.

(2009) conclude that a well-constructed case study strategy can enable a researcher to

challenge an existing theory and also provide a source of new research questions.

3.5 Data Collection Instruments

Data was collected through semi-structured interview questionnaires to allow room for

probing and also to enable respondents toconvenientlyand freely express themselves.

3.6 Population and Sampling

3.6.1 Population

According to Saunders et al. (2009), a target population refers to the entire group of

individuals or objects to which researchers are interested in generalizing the conclusions. A

sampling frame is a list of all those within a population who can be sampled, and these may

include individuals, households or institutions. In this research study, the population is all

the banking institutions in Zimbabwe. A list of all the operating banking institutions was

obtained from the Reserve Bank of Zimbabwe (RBZ). At least one interview guide was

administered at each institution to promote fair representation.

Table 3.1 overleaf tabulates the number of banks in Zimbabwe.

51

Table 3.1: Banks in Zimbabwe

Bank

1 Agricultural development bank(Agribank)

2 BancAbc Zimbabwe

3 Barclays Bank of Zimbabwe

4 CABS

5 CBZ Bank Limited

6 Ecobank Zimbabwe

7 FBC Bank Limited

8 MBCA Bank limited

9 Metropolitan

10 NMBZ Bank Limited

11 POSB

12 Stanbic Bank Zimbabwe Limited

13 Standard Chartered Zimbabwe

14 Steward

15 ZB Bank Limited

3.6.2 Sampling

Saunders (2007) defines a sample as a representativecomponent of a statistical population

which is studied to obtain information about the whole population. There are two classes of

sampling techniques namely, probability and non-probability sampling techniques.

Probability sampling techniques are compatible with quantitative research approaches

whereas qualitative studies make use of non probability sampling techniques. Some of the

probability sampling techniques are simple random sampling, stratified random sampling

and cluster sampling. The non-probability sampling techniques include,purposive or

judgmental sampling and convenience sampling.

3.6.3 Judgmental sampling

Purposive or judgemental sampling enables use of judgement in selecting cases that will

best enable the researcher to answer the research questions) and to meet the research

objectives (Saunders et al., 2009; 237). Babbie and Mouton (2012),endorse that it is

52

appropriate to select a sample on the basis of the researcher’s knowledge of the population,

its elements and the nature of the research aims. In conducting this study, the researcher

used judgmental sampling method. The researcher targeted human resources practitioners,

based on their knowledge of human resources management tools, particularly the succession

planning and management practice. The researcher also targeted bank management since

they are expected to be responsible for the implementation of succession planning practice.

3.7 Data Analysis Techniques

Qualitative data obtained through semi structured interview guides was analyzed using the

thematic approach and content analysis. The information obtained from interview

transcripts was analyzed against theory referred to in literature review in order to inductively

develop coded categories. Data coding enabled establishment of common themes, patterns

and relationships in order to make appropriate inferences.

3.8 Validity and Reliability

3.8.1 Validity

According to Saunders et al. (2009) validity is concerned with whether the findings are

really about what they appear to be about. Greener (2008) characterizes validity in three

different ways, namely, internal validity, face validity, and construct validity. Internal

validity refers to the ability to identify extraneous or independent variables and how they

may affect the dependent variable. Face validity relates to the ability to decipher whether a

research instrument and the method used are suitable and appropriate from the face of it.

Construct validity is when the instrument and method are able to measure that which the

researcher intends to measure. Sometimes results can be invalidated because the respondent

does not understand the questions and answer in a way that they think is intended. To

address the issue of validity, the researcher continuously collected qualitative data through

semi-structured questionnaires until data saturation was reached (Saunders et al., 2009;

235). The researcher conducted interviews until additional data collected provided very little

new insights. An upper limit of 25 interviews and a lower limit of 10 were used.

53

3.8.2 Reliability

Reliability refers to the degree to which research instruments and methods are consistent and

reliable. It is the extent to which data collection techniques or analysis procedures yield

regular findings (Saunders et al., 2009). To ensure reliability, the researcher pilot tested the

research instrument to five possible respondents.

3.9 Limitations

The research had a deadline to complete the study in six months. It was cross sectional and

made use of responses of thirteen targeted respondents due to time and cost constraints.

3.10 Ethical Considerations

According to Saunders et al. (2009),research ethics refer to the appropriateness of the

researchers’ behaviour in relation to the rights of those who become the subject of their

work or are affected by the work. Ethics are moral choices that determine decisions,

standards and behavior (Greener 2008). In carrying out the research, the researcher faces a

dilemma in moral choices, such as how to gather data, how to meet people or how to deal

with uncooperative people. Qualitative research poses a greater range of ethical concerns as

compared to quantitative research (Saunders et al., 2009). These range from seeking access

to maintaining confidentiality.

a) Gaining access: the researcher addressed this by providing all the relevant

information pertaining to the research purpose and objectives. Ethical concerns are

associated with the ‘power relationship’ between the researcher and those who grant

access, and the researcher’s role (Saunders et al., 2009). A confirmation letter from

the University of Zimbabwe authenticating the researcher’s student status, together

with a research proposal and an introductory letter drafted by the researcher were

availed to the relevant banking officials.

b) Researcher’s identity- the researcher displayed a student Identification Card for

identification purpose.

c) Confidentiality- By nature, a bank’s human resources system is usually confidential,

therefore, it was imperative for the researcher to maintain confidentiality in carrying

54

out research. The purpose of ethical considerations is to ensure that no one is harmed

or suffers adverse consequences from the research activities (Cooper and Schindler,

2003). To avoid eembarrassment and harm resulting from reporting data that are

clearly attributable to a particular individual (Cooper and Schindler 2008; Robson

2002), the researcher was careful to protect the participants by maintaining

confidentiality and anonymity of their information, identities and the organisations

they work for.

3.11 Conclusion

This chapter outlined how the researcher carried out the research by looking at the research

philosophy that influences the researcher’s decision and identifying the population and

sampling frame as well as the sampling method used. It indicated that the research was

qualitatively conducted. Primary data was predominantly used, secondary data was also

considered in order to qualify some findings. The following chapter considers field findings,

data presentation and analysis.

CHAPTER FOUR: RESULTS AND FINDINGS

4.0 Introduction

This chapter presents the research findings from the interview questionnaire that the

researcher administered to the targeted manag

findings using content analytic tables. The results obtained from the questionnaires were

summarised and presented. The researcher then went further to cross link the findings to the

reviewed literature relating to succession planning practices in banks. The research questions

were used as a basis of the questionnaire and were conveniently categorised into four

sections namely; demographics, the current succession planning practice, succession

planning challenges and succession planning strategies.

4.1 Profile of the respondents

The questionnaires were administered to thirteen respondents. The targeted respondents

were made up of executives and managers from different professional backgrounds in the

local banking industry.

4.1.1 Demographic Information of respondents

Figure 4.1 displays the respondents’ level of education.

Figure 4.1: Respondents’ level of education

54%

Respondents' level of Education

CHAPTER FOUR: RESULTS AND FINDINGS


researcher administered to the targeted management in banks. The researcher analysed these



g to succession planning practices in banks. The research questions



s and succession planning strategies.

4.1 Profile of the respondents



4.1.1 Demographic Information of respondents

Figure 4.1 displays the respondents’ level of education.

Figure 4.1: Respondents’ level of education

46%

54%

Respondents' level of Education

Degree Masters

55


ement in banks. The researcher analysed these



g to succession planning practices in banks. The research questions





56

The majority of respondents (54%) were holders of masters’ degrees while the remainder

(46%) have first degrees.

Figure 4.2: Professional background of respondents

The respondents’ profile comprised people from various backgrounds in the banking sector.

Table 4.1 overleaf displays the summarised demographic information of the respondents.

Respondents by Professional background

HR

Marketing

Corp. Banking

Retail Banking

Finance

Accounting

Treasury

Strategy

57

Table 4.1: Demographic personal information of respondents

Respondent’s

current

position

Key Age of

respondent

Professional

background

No. Of years in the

banking industry

No. Of years

in current

position

Level of

Education

Head R1 36-40 Corporate banking 11-15 ≤ 5 Masters

Manager R2 36-40 Strategy 6-10 ≤ 5 Masters

Manager R3 36-40 Corporate Banking 11-15 6-10 Masters

Manager R4 31-35 Human Resources 6-10 ≤ 5 Masters

Head R5 31-35 Finance 11-15 ≤ 5 Masters

Executive R6 41-45 Finance 16-20 ≤ 5 Masters

Manager R7 31-35 Accounting 6-10 ≤ 5 Degree

Manager R8 36-40 Retail banking 11-15 ≤ 5 Degree

Executive R9 41-45 Marketing 6-10 6-10 Degree

Manager R10 36-40 Human Resources 11-15 6-10 Masters

Executive R11 46-50 Human Resources 16-20 6-10 Degree

Manager R12 36-40 Retail Banking 11-15 6-10 Degree

Manager R13 41-45 Treasury 11-15 11-15 Degree

The demographic information indicates that the majority of respondents have satisfactory

experience in the banking sector. By virtue of their designated roles, they suffice as suitable

respondents to the subject matter the researcher is analysing. Literature reveals that the

succession planning process should be owned by line management, senior management and

the Chief Executive Officer for it to bear fruits. The researcher chose to interview executives

and managers with different professional backgrounds in the banking industry in order to

understand the way each of them views and relates to the research problem. These are the

people responsible for ensuring succession planning takes place and are influential in its

implementation. They are presumably knowledgeable enough to articulate the current

succession planning practice in their banks and the way it is implemented.

58

4.2 Section B: Current Succession planning practice

This section analyses the responses given to questions on the current succession planning

practice in the banking industry in Zimbabwe.

The tabulated information in Table 4.2 below shows the given responses pertaining to

succession of Executive roles.

Table 4.2 Replacement of personnel in Executive roles

Respondent Response

R1 Done internally

R2 From internal talent pools

R3 Internally and externally

R4 Internally

R5 Both Internally and externally

R6 Internally

R7 From within the organisation unless there is no ready fit

R8 Both internal and external candidates are considered

R9 Either internally or externally

R10 First preference is given to internal talent

R11 The bank considers suitability of internal candidates before looking outside

R12 Depends on requirements of the role

R13 The bank considers the internal talent pool first.

Thirty eight percent of the respondents indicated that executive roles that fall vacant are

filled in with either internally promoted people or external appointments. Where internal

promotions to executive positions take place in most cases the incumbent would have been

recruited into the bank at a level slightly lower than the executive level. Through further

analysis of banks’ current executives’ profiles, the researcher observed that there are a few

cases of executives who rose through the ranks of one bank to land the executive role. Of the

few cases the researcher observed, there is the current managing director of Barclays bank

Zimbabwe who rose through the ranks to become the managing director. This is an example

of a successful succession plan within an organisation. Further analysis of executive profiles

show that some banks’ succession management of the CEO role follows a clear pattern of

59

having a deputy CEO who will later be appointed to the substantive role of CEO in the event

of a departure.

The organisation can fill in positions “internally or externally depending on the complexity

of the position and skill set required for the job” (R5).

Table 4.3 below summarises the responses in relation to how respondents view succession

planning.

Table 4.3 Respondents’ view on Succession planning

Respondent Response

R1 It is a necessary talent management tool, it increases productivity and

financial performance

R2 It is essential

R3 It aids in ensuring business continuity

R4 It is an effective tool of ensuring business delivery in an organisation

R5 It is necessary to ensure leadership sustainability

R6 It is a staff retention and motivation tool

R7 It fosters employee loyalty and investor confidence.

It is also a regulatory requirement at senior levels.

R8 Succession planning is good for continuity purposes

R9 Succession planning ensures the bank has a fallback position

R10 It averts risk of business disruption and leadership crisis

R11 It is important, it gives the bank direction

It ensures there is adequate bench strength of talent

R12 Succession planning saves the organisation time and money

R13 It helps create the future for the organisation

Despite the prevalent harsh economic environment, punctuated by high levels of

unemployment in Zimbabwe, all the respondents concurred that succession planning is a

very necessary organisational practice. The researcher found out from one respondent (R1)

that succession planning increases financial performance. Most of the respondents’ views of

succession planning as a staff retention tool, a necessary practice to ensure leadership and

organisational continuity are in line with literature recommendations (Rothwell, 2005;

60

Groves, 2007). One respondent (R6) summarised their understanding of succession planning

as follows;

“Succession planning is an effective tool of ensuring that there is continuity in terms of

business delivery within an organisation. A proper succession planning ensures that a

company’s business culture is preserved by way of elevating staff who understand the

organisation’s values and principles. This aids in avoiding disruption of work when key

members of an organisation leave. Succession planning also acts as a motivator for

incumbent staff in various positions to produce the best they can with a view to assuming

senior roles as they gain experience”. (R6)

By posing this question to respondents, the researcher wanted to ascertain how well they

understood the notion of succession planning, especially given that most of them are not

from a human resources management background. The researcher was satisfied with

respondents’ level of appreciation of the concept and its benefits to business.

Table 4.4displays responses on identification of candidates for succession.

Table 4.4 Identification of succession candidates

Respondent Response

R1 Based on performance, qualifications and experience

R2 Consider qualifications, experience, expertise and performance

R3 Consider the right attitude, qualifications, experience and ability.

R4 Based on individual performance in current role and consistency in

performance levels.

R5 Candidates selected based on performance, qualifications, expertise and

experience.

R6 Identify people with expertise.

R7 Consider performance in current role, qualifications, experience and expertise

R8 Qualifications and experience are important

R9 Level of Experience

R10 Qualifications, experience, performance

R11 Consider multi skilled candidates, their performance and qualifications

R12 Experience, qualifications and performance

R13 Consider high leadership potential, qualifications and performance levels

61

Analysis of responses regarding identification of succession candidates shows that 77% of

the respondents consider qualifications, performance and experience as basic criteria for

selection of candidates. This is in line with what Flynn (2014) recommends when she

explains adoption of a competency/potential approach in creation of talent pools. However,

one respondent (R3) stated that it is quite important for the identification exercise to

consider attitude, ability and leadership potential of employees;

“People may have the right qualifications and experience but lacking the ability, the drive

and the correct attitude that a leader should possess”. (R3)

Table 4.5 captures respondents’ feelings relating to development of internal candidates for

promotion to key positions versus hiring externally.

Table 4.5 Developing internal candidates for promotion to critical position

Respondent Response

R1 Its good, promotes loyalty and productivity

R2 Good-it preserves organisational culture

Bad-promotes resistance to change, inbreeding

R3 Developing internal candidates for succession minimises learning curves

and promotes seamless business continuity

R4 Good-motivates staff and preserves organisational culture

R5 Good for value system preservation and cultivating loyalty

Bad in terms of change management

R6 Good for motivational purposes. However, hiring externally is also good for

organisational culture change

R7 Developing internal succession candidates ensures the bank realises return

on investment. However, It may create entitlement mentality

R8 It is good for the organisation and the individuals

R9 It is a worthy investment

R10 It is better than hiring externally

R11 It is better to develop internally to minimise learning curves and preserve

culture

R12 Developing people internally strengthens brand equity if the people are

sharp enough

R13 It’s worthwhile and cost effective, on the flipside people may hold the

organisation at ransom

62

Although all the respondents viewed development of internal candidates for promotion to

senior crucial roles as being good, about 31% also commented on the flipside of this

initiative. Those who expressed sentiments against developing internal candidates were of

the view that internally developing candidates for promotion fuels inbreeding and encourage

resistance to change. One respondent (R7) expressed that it may create entitlement

mentality in those being groomed for succession;

“It’s very good if done objectively and the bank will realise return on investment. It may be

bad when it promotes entitlement mentality in the identified candidates. Having a talent pool

of potential successors is a good back up plan in case of departures”. (R7)

Another respondent (R13) put his views across as follows;

“Developing internal candidates for promotion is a good initiative as it builds on already

existing experience and knowledge of people in the organisation. However, it turns out to be

bad when the individuals use their expertise and experience against the organisation’s

strategies and we sometimes encounter such challenges” (R13).

Table 4.6 below reveals responses pertaining to incorporation of succession planning into

the bank’s strategic plans.

Table 4.6 Incorporation of succession planning into the bank’s strategic plans

Respondent Response

R1 Yes it is incorporated

R2 Yes it is incorporated through personal development programs and

talent discussions

R3 Yes through management and leadership development programs

R4 Succession planning is part of the bank’s strategic plan

R5 It is part of strategy

R6 Yes-it is a requirement for business continuity plan

R7 It is, through training and development initiatives for managers

R8 It is part of strategy, it is a regulatory requirement

R9 Yes, it is discussed as part of talent management initiatives

R10 Yes, but it is not highly prioritised as it should

R11 It is included as it is a compliance requirement

63

R12 It is incorporated as a staffing issue

R13 Yes it is included

The research finding indicates that all banks indeed include succession planning in the

organisational strategic plans. However, the researcher gathered that it could be an issue of

being compliant with regulatory requirements more than being the bank’s strategic initiative.

In their own words, (R11) had this to say;

“Succession management is part of the bank’s strategic plan. The only slacking component

is to assign accountability for the processes that the practice demands. More effort should

be channelled towards how the developmental initiatives will be handled. As long as there

are plans in place then we are compliant with regulatory requirements” (R11).

In relation to Labour Act amendments and their possible impact on succession planning,

table 4.7 below details the obtained responses.

Table 4.7 Impact of amendments to the Labour Act on Succession planning

Respondent Response

R1 No Impact

R2 No impact

R3 This does not impact negatively on succession planning

R4 No impact- termination of employment usually targets non-performers

R5 No

R6 No

R7 None

R8 To a lesser extent

R9 No major impact

R10 No impact

R11 No negative impact

R12 I don’t see how the amendment impacts the practice

R13 Not necessarily

All the respondents agreed that the amendments made to the labour Act after the Zuva

Petroleum 2015 case ruling have no impact on succession planning as a practice. This is in

64

line with scholars who stated that succession planning should be practiced regardless of the

state of economic situations, in good and bad times (Goldsmith, 2009). One respondent (R6)

put across that there is no impact “since it is likely that those who receive the letters were not

in the organisational plans. The required staff members will be retained and will not be

given such notices”. Another respondent articulated that although it may cause employees to

feel insecure, three months’ notice letters usually target non-performers. One executive

summed it up as follows;

“The amendment is not exactly a threat to succession planning practice because there is no

way a competent employee can be unceremoniously given notice of employment termination

unless on the grounds of misconduct, fraud or other related offences that warrant

dismissal”. (R9)

Table 4.8 below captures the human resources management tools that the respondents’

banks utilise to preserve institutional memory.

Table 4.8 Human resources management tools that facilitate preservation of

institutional memory

Respondent Response

R1 Coaching and mentoring

R2 I am not sure

R3 Training and development

R4 In house training and on the job mentoring

R5 Technical and behavioural training

R6 mentoring

R7 Job shadowing and coaching

R8 mentoring

R9 mentoring

R10 mentoring

R11 Coaching and mentorship

R12 Coaching and mentorship

R13 Job shadowing

65

Whilst it could be fairly easy to pass technical knowledge from one employee to the other,

tacit knowledge may be difficult to impart. Seventy seven percent of respondents cited

mentorship and coaching as key ways that facilitate preservation of institutional memory.

Eight percent were not sure of the tools and 15% mentioned job shadowing, technical and

behavioural training.

Table 4.9 details the developmental initiatives used to narrow the gap between present work

needs and future work requirements of identified successors.

Table 4.9 Developmental initiatives to narrow gaps between the selected successors’

present work needs and future work requirements

Respondent Response

R1 Coaching, Mentoring, training

R2 Job enrichment, Training, Coaching, Mentoring

R3 Management and Leadership development programmes

Assigning acting roles to potential successors

R4 In house and external training, on the job mentoring

R5 Job rotation and enrichment, training,

R6 Job rotation

R7 Targeted training

R8 Training and development

R9 Job enrichment

R10 Training

R11 Management and Leadership development programmes

R12 Training

R13 Training, job enrichment

It is evident from the responses that banks use a variety of developmental initiatives to

bridge the gap between the identified successors’ present work needs and future work

requirements. Training is almost always recommended as a panacea to cure organisational

ills like under performance of employees, but on its own, it may not sufficiently bridge

performance gaps. One respondent (R1) had this to say;

66

“Identifying people suitable to succeed key posts is not enough; interventions should surely

be in place to mould the individuals in such a way that when the time comes they will be fit

enough to match the role. To me, mentorship and coaching are very important. Training is

not usually individual specific though of course it helps too.”

In relation to the importance of succession planning to organisational sustainability, table

4.10 below presents the responses given.

Table 4.10 Succession planning and organisational long term sustainability

Respondent Response

R1 Succession planning ensures organisational long term sustainability

R2 It ensures retention of the vision

R3 Succession planning ensures seamless business continuity

R4 Succession planning helps preserve a company’s identity

R5 Succession planning is beneficial to organisational long term

sustainability

R6 Yes it ensures long term survival

R7 Planning for the future of the organisation is critical for business

continuity

R8 The practice strengthens the brand

Succession planning also boosts investor confidence

R9 It fosters loyalty in employees and ensures organisational sustainability

R10 Yes it ensures organisational long term survival

R11 It aids in retention of skilled personnel who will carry the organisation

further

R12 It is a necessary tool to ensure organisational survival

R13 Yes, it creates a sense of organisational continuity and culture

All respondents agreed that succession planning is beneficial to organisational longevity.

This finding is in line with other scholars’ findings (Govender, 2010), as well as literature on

the subject matter. In their own words, one of the respondents (R4) summarised their

sentiments as follows;

“Succession planning is beneficial in the sense that it ensures that key organisational values

and principles are passed on from one generation to the next, which is important in

67

preserving a company’s identity. The only possible threat is that it may limit the amount of

new ideas that can be introduced to the company. In the long term, an organisation also

needs to adapt to changes within the trading environment in order to ensure sustainability of

operations and this can largely be achieved through injection of fresh ideas”. (R4)

The respondent’s sentiment on injection of fresh ideas is also in affirmation with other

studies that show that external succession brings about strategic change and is more

appealing (Elsaid, 2011).

Respondents rated their organisations’ current practice of succession planning and their

responses are presented in Table 4.11 below.

Table 4.11 Overall state of the current succession practice

Respondent Response

R1 it is good enough

R2 it is fair, difficult to measure as people remain in the same job for too

long due to the prevalent hardships

R3 Good

R4 Fair, no consistency

R5 Fair

R6 Good, internal candidates are considered first

R7 Good, though there is room for improving the process

R8 Good

R9 Good

R10 fair

R11 Good

R12 fair

R13 Poor

Fifty four percent of respondents rated their organisations’ succession planning process as

good, with 38% rating it as fair and eight percent rating it as poor. This finding can be

compared with what Nassor (2013) found out when he carried out a similar research on

Kenyan commercial banks. According to his study findings, 92% rated their banks’

68

succession planning processes as good or better and only eight percent rated the processes as

fair.

In this research, one of the respondents who rated it as fair stated that “it is sometimes

affected by bureaucracy and favouritism which slows decisions and shifts them from being

objective” (R10).

Another respondent (R2) had this to say;

“The process barely goes beyond identifying candidates that qualify to make the talent pool.

It is only just about enough to ensure that there is continuity of operations when key staff

leaves the organisation. Human resources department should do more to ensure the process

runs the full cycle”.

Of the 54% who rated the process as good, R3 aptly captured the sentiments of the other

respondents with these words;

“The organisation always gives internal candidates the first opportunity to fill in vacant

posts before considering outsiders. Ninety percent of vacancies at managerial level going up

are filled internally. This is an indication that the process is being followed through”

4.3 Section C: Succession planning challenges

This section looks at the challenges that work against successful implementation of

succession planning processes. The researcher wanted to ascertain whether the respondents

are aware of any challenges that could be working against implementation of fruitful

succession plans. Table 4.12 below summarises the findings.

Table 4.12 Succession planning challenges

Respondent Response

R1 Lack of management support, Lack of communication, Inadequate HR

systems and policies

R2 Mirror effect of management, Lack of management support

R3 Lack of management support, Closed culture approach, Nepotism

R4 Lack of transparency, Nepotism and favouritism, Incompetent HR staff

R5 Lack of management support

69

R6 Lack of budget, too much focus on planning, Inadequate HR systems

R7 Lack of communication, Inadequate HR systems


R9 Lack of communication

R10 Lack of management support, Lack of communication

R11 Lack of management involvement, Favouritism


R13 Lack of communication

The finding reveals that there is rampant lack of management support (62%) that works

against effective implementation of succession planning processes. Lack of communication

as well (38%) was given as another major challenge and this is in line with literature

findings that people usually co-operate better when they are aware of what is happening and

what is expected of them. There is one finding the researcher found worrisome. One

respondent (R4) articulated that;

“Succession planning efforts are hindered by incompetent Human Resources staff who are

too narrow-minded in how they administer the process”

4.4 Succession planning strategies

Having outlined the various challenges that hinder successful implementation of succession

plans, respondents offered strategies to minimise and overcome the challenges. Table 4.13

below presents the strategies.

Table 4.13 Succession planning strategies

Respondent Response

R1 Be objective in selecting talent.

Obtain board and management buy-in.

R2 Bench mark against other working environments and countries.

Adoption of best practice.

R3 Expose identified successors to other countries and/or business units.

Educate decision makers on benefits of succession planning.

70

R4 Set out a clearly defined succession policy.

Strategise on ways to bridge performance gaps in identified successors.

R5 Communicate with the identified talent and set clear career paths.

R6 Improve on communication.

Adopt modern HRM practices

R7 The bank should have a provisional budget to cater for staff development.

Succession planning should not be done mysteriously.

R8 Plans should be executed, hold the relevant people accountable by including

it on their key result areas.

RBZ should carry out compliance audits after every 18 months or so.

R9 Communicate with all staff using staff bulletins on what succession planning

is and how it benefits the bank.

R10 The regulatory authority should request detailed developmental plans for the

identified successors.

Succession planning should be a board initiative.

R11 Effective communication with all stakeholders is important.

The CEO must be enthusiastic about it for everyone to appreciate it.

R12 Have the HR people to follow up on line management regarding what

training interventions are required.

R13 Training of all interested parties on how effective succession planning

process should work.

Senior roles should have fixed term performance related contracts-term

limits.

4.5 Summary of findings

4.5.1 Current succession planning practice

The research findings revealed that banks have succession plans in place and are indeed

compliant with the regulatory authority requirements. Respondents have adequate

understanding of succession planning as a practice. However, the mixed sentiments

71

concerning developing internal successors for promotion to key roles vis a vis taking on

board external successors bear testimony that internal succession planning implementation

could be burdened with some challenges. The responses showed that even though succession

plans are there, they are not sufficiently subjected to a sequential process to ensure effective

implementation.

4.5.2 Challenges facing succession planning

Responses obtained were in tandem with findings observed in other studies conducted in

banks elsewhere (Mwemezi, 2011) and also what other writers on succession planning cited.

The implementation process is flawed with quite a number of challenges as revealed in the

findings. Lack of management support tops the list. Some respondents hinted that while

some managers and executives are doing so much to coach and mentor their subjects for

succession some are simply sabotaging the process probably due to reasons to do with

insecurity.

4.5.3 Strategies to improve succession planning practice

After analysing the current state of succession planning and taking into account the

challenges facing the practice, respondents recommended an array of strategies that they felt

can help improve succession planning process in banks in Zimbabwe. When a system or

process is not working as it is supposed to, it is best to firstly find out the reasons why in

order to formulate appropriate strategies to remedy the situation. Most strategies suggested

by the respondents were in confirmation with literature findings (Larcker and Saslow, 2014;

Flynn, 2014). Management and CEO support were found to be of fundamental influence.

4.6 Conclusion

The chapter presented the research findings obtained from respondents in the Zimbabwean

banking industry. Findings were obtained on the current succession planning practice, the

challenges inherent in implementation and respondents’ proposed strategies to improve the

practice. The researcher presented and compared some of the findings to those obtained by

other scholars in related studies as well as to other bodies of literature. The final chapter

focuses on conclusions and recommendations of this study.

72

CHAPTER FIVE: DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS

5.0 Introduction

This chapter details the inferences and conclusions drawn from the research study on the

implementation of succession planning practice in the banking industry in Zimbabwe. It also

focuses on recommendations and possible areas of further study. The research confirmed the

proposition that “succession planning as currently practised in Zimbabwe’s banking industry

is not being fully utilized as a talent management tool”. There is a glaring gap between

planning and implementation. This chapter is significant in that it suggests recommendations

and areas of further study in order to minimise management problems emanating from

succession management, particularly in the banking sector in Zimbabwe.

5.1 The research

The main objective of this study was to analyze the implementation process of succession

planning practices in the banking industry in Zimbabwe. Literature reveals that effective

succession planning processes assist in retaining talent, preserving institutional memory and

enhancing organisational sustainability and development.

The banking industry trades in public funds and has multiple stakeholders, therefore the

concepts of continuity and active institutional memory are of great importance. This study

sought to establish the current practice of succession planning in banks, examine the

challenges preventing the practice from running the complete cycle, as well as find out the

strategies that can be employed to counter these challenges. The findings obtained from this

study confirm that banks make an effort in coming up with succession plans for key

positions. The findings also reveal that the implementation process of these plans is troubled

by quite a number of challenges which obstruct realisation of tangible outcomes.

5.2 Conclusions

The conclusion drawn from this research is that although banks fully appreciate the benefits

of succession planning practice, they are struggling to bridge the gap between planning and

73

outcomes. It is evident that there are challenges limiting the successful implementation of

the related processes that are crucial to make the practice effective. The study gathered that

some human resources practitioners in banks in Zimbabwe are not competently playing their

facilitation role in implementing succession planning as evidenced by the investigation. The

research proposition that “succession planning is not being fully utilized as a talent

management tool in Zimbabwe’s banking industry” was validated by the findings relating to

the current administration of the practice. The research concluded that there are various

strategies that can be adopted to enhance the smooth flow of succession planning

implementation. This is apparent from the subsequent conclusions reached in relation to the

research objectives.

5.2.1 Succession planning in banks

The researcher inferred that there is a gap between the plans and the expected outcomes,

which suggests that the implementation process is not as effective as it ought to be. Due to

the regulatory compliance requirement, succession planning is a strategic issue, individuals

are earmarked for succession but that is only as far as the planning goes. Implementation of

the plans by way of developing and periodically appraising the identified successors is

fraught with challenges. The researcher concluded that succession planning as currently

practised in banks in Zimbabwe is not up to expected standard as it is not adequately running

the full cycle. This may explain the random manner in which vacancies in executive

positions are filled in.

On identification of candidates for succession, the research concluded that there is lack of

objectivity as some candidates are selected on grounds of favouritism and nepotism rather

than on merit.

Succession of executive positions is done with either internal or external candidates

depending on skill set required. This could be symptomatic of the fact that internal

succession candidates sometimes fall short of the competence requirements of executive

roles which prompts the organisation to look outside for suitably skilled successors. It could

also be suggestive that banks value injection of fresh ideas in a bid to remain competitive in

the midst of a volatile business operating environment.

The findings confirm that succession planning is beneficial to organisational long term

survival by way of preserving the institutional memory and culture. The research concluded

74

that the succession practice in banks requires management accountability and objectivity of

selection process for it to be effective.

5.2.2 Challenges facing successful implementation of succession planning

Of the challenges facing succession planning, lack of management support was commonly

cited factor. Some other challenges included inadequate human resources systems, lack of

communication, closed culture approach, as well as lack of budget. It is clear that succession

planning as a practice cannot be effective as long as these challenges are not seriously

addressed. It is also unambiguous that without adequate management buy-in, succession

planning will remain just a plan without satisfactory outcomes.

5.2.3 Strategies to improve the practice

Respondents suggested a number of strategies they deemed suitable to make succession

planning an effective practice. The study concluded that although there may be various

strategies available, the most important strategy that will set in motion all the other strategies

is Management involvement in succession planning as a practice. The study findings reveal

that support at board level is of fundamental importance.

5.3 Recommendations

In light of the findings obtained, this study suggests the following recommendations to

improve the succession planning implementation process in the banking industry in

Zimbabwe.

5.3.1 Board accountability

Succession planning should be included on the board’s performance scorecard. Not only

will this ensure the practice gets entrenched into the system, it will also uphold good

corporate governance practice. Term limits should also be introduced alongside this

measure. Contractual term limits ensure constant regeneration of banks as people get used

to passing on the baton when the time is ripe or when nearing retirement.

75

5.3.2 Management Support and participation

The researcher recommends that management takes the initiative to ensure succession

planning practice runs the full cycle by taking ownership of the processes from planning to

outcomes. They should actively disseminate plans for implementation and be avid

supporters of the activities involved in order for the same feeling to cascade down to all the

employees. It is popularly said that a fish rots from the head and this saying suggests that if

management do not proactively engage themselves in the processes of succession planning

then the rest of the workers’ body will not be able to appreciate its importance or

significance. Regular reviews should be done to evaluate the implementation processes.

5.3.3 Succession Policy

Banks should craft a standalone policy and procedure document that details the succession

planning process as well as outline the relevant accountable officers. By virtue of it being a

standing instruction, a succession policy will ensure there is uniformity of understanding and

implementation of the processes. It will also ensure that efforts will be made towards

maintenance of the talent pool. Furthermore, a disclaimer should be included in succession

planning documents to guide against promotion expectancy syndrome that may arise in the

identified successors.

5.3.4 Strengthening regulatory compliance audits

The RBZ should ensure they have human resources practitioners in their supervision wing

so that they can appropriately monitor the submitted succession plans to ensure the proposed

developmental plans are implemented. This will assist in making the succession planning

efforts effective. RBZ bank supervision officers should not just be satisfied with the

presentation of succession plans during compliance audits.

5.3.5 Human resources Management systems

It would be ideal for banks to invest in robust human resources management systems with

talent management tools that enable tracking of succession planning process from

identification of potential successors (talent pool) to performance appraisals and evaluation

of the processes. This assists with follow ups as well as accountability in terms of managing

76

the related activities involved in the process. In line with this, it would be best to ensure the

human resources practitioners in banks are proficient enough to facilitate the administration

of the talent management processes amongst which succession planning is a key tool.

5.3.6 Performance appraisals: 360 degree

To address the problem of lack of objectivity in the selection of succession candidates as

well as curb the management mirror effect, it will be best for banks to identify their high

fliers through use of 360 degree feedback performance appraisals. It is to the organisation’s

long term benefit if the right people with the right competencies and potential are identified

and groomed for succession. This will minimise challenges of favouritism and nepotism in

the selection of potential successors.

5.3.7 Training and Development

Although training is not the panacea to all organisational ills, it surely plays an important

role in shaping the successors, as well as preparing incumbent job holders to let go when

their term of office is up. Banks should endeavour to develop their future leaders in a bid to

bridge the gaps between their present work needs and their projected future work

requirements. Need based training shifts the focus from just planning but ensures the desired

outcomes are achieved. It is necessary to invest in management development programs

(MDPs) and leadership development programs (LDPs), the return on investment will be

realised through well groomed employees who have the capacity to carry the organisation

forward.

Adoption of these recommendations will ensure succession planning practice is treated with

the seriousness it deserves and may assist with alleviation of the challenges that prevent the

successful implementation of the practice.

77

5.4 Evaluation of research proposition

The researcher maintains that the actual practice of succession planning is not being fully

utilized as a talent management tool in Zimbabwe’s banking industry. It is not running the

full cycle.

5.5 Limitations of study and areas of further research

5.5.1 Limitations

The major constraint to this study was the limited time frame within which the researcher

had to conduct research especially as she delivered a baby within the same period.

Additionally, the researcher faced some difficulties in obtaining information from some of

the targeted respondents whose responses would have uniquely enhanced the quality of this

research.

This research was conducted in a single industry and it exclusively focused on the banking

sector therefore its recommendations may not necessarily be generalized to other contexts.

However, a similar case study for the IT industry done by Avanesh (2011) revealed similar

observations, suggesting that the recommendations may be applicable in other specialised

industries. The research focused on succession planning as a single tool. Results may be

inconclusive since inferences can also be drawn from other talent and human resources

management tools that aid talent retention and organisational sustainability and continuity.

The research also made use of the non-probability sampling approach, therefore, results

cannot be generalised to a larger population.Nevertheless, learning points can be derived

from it.

5.5.2 Areas of further research

Succession planning is a component of talent managementpracticetherefore, it could be

beneficial to look at other talent management tools in a bid to enhance organisations’ talent

retention strategies. This study focused on succession of executive positions; there are other

crucial technical roles in the banking industry that warrant the need for succession planning.

Further studies can be conducted on technical succession. Furthermore, due to the growing

informal sector in Zimbabwe, it would be interesting for future research on succession

planning to investigate whether budding entrepreneurs consider the practice at all and to

78

what extent they deem it a necessary continuity tool. Issues or topics that warrant further

research may include;

Sole proprietorship and business continuity.

Succession management at technical levels, a case of corporate entrepreneurship.

Investigating succession planning against stewardship and Agency approaches to

leadership.

The relationship between succession planning and Organisational performance.

79

References

Annan, K., 17 April 2000, “Excerpts of Secretary General of UN’s Introductory Remarks.

Armstrong, M. (2011) A Handbook of Human Resource Management Practice. Volume

9.Kogan Page Publishers.

Avanesh, N. (2011). A study on Succession Planning and Its Impact on Organizational

Performance in the IT Sector.Journal of Arts, Science & Commerce, 2(1) 1-12 Canavan K.

(2001). Leadership Succession in Catholic Schools: Planned or Unplanned? A journal.

Barlow, L. 2006, Talent development: the new imperative. Development and Learning in

Organisations. Vol. 20, no. 3, pp.6 – 9.

Barney J.B, Hesterly W (2012). Strategic Management and Competitive advantage:

Concepts and cases

Chanaka NF (2014). An Evaluation of the effectiveness of the Labour Arbitration System in

Zimbabwe, Dissertation of Masters in Business Administration(MBA), University of

Zimbabwe, Zimbabwe.

Creswell, J.W (2009). A Research design: qualitative, quantitative and mixed methods

approaches. London.

De Juan, A. (2003). From good bankers to bad bankers.Economic development Institute of

the Word Bank, Journal of banking regulation.

Elsaid E. (2011). Does Experience matter? CEO Successions by former CEOs Managerial

Finance 37 (10) 915-939

Erasmus, E (2009). The Effectiveness Of Succession Planning in SARS Enforcement Port

Elizabeth, Unpublished Dissertation of Masters in Business Administration(MBA) at the

Nelson Mandela Metropolitan University, SA.

Flynn, J.L.C (2014). Succession Planning beyond Theory.Legal Education Society of

Alberta ACLEA’s 50th Annual Meeting Boston, MA, August 2-5, 2014.

Govender, I (2010).Succession Planning as a tool to minimise staff turnover rate: A case

study ofNedbankHomeloans’ KZN operations. University of Kwazulu Natal, South Africa.

80

Groves, K.S. 2007, Integrating leadership development and succession planning best

practices, Journal of Management Development, Vol. 26. No. 3, pp. 239-260.

Hedum, K (2010). Succession Planning: The Critical Challenge for Law Enforcement of

Developing Leadership Capital in the 21st Century. University of Central Florida.

http://www.asaecenter.org/Resources/whitepaperdetail.cfm?ItemNumber=40406

[27/01/2016]

http://www.emmerichfinancial.com/strategic-planning/succession-plan/[23/01/2016]

Ibarra, P. (2005). Succession Planning: An idea whose time has come. Journal of Public

Management, 87(1): 18 – 24.

Ibarra, P., (2004) “Incorporating Succession Planning into Your Organization”. ACMA-

Arizona City/County Management Association 2004 Summer Conference, <PDF>

[Electronic Version]

Kim, Y (2006). Measuring the value of succession planning and Management: A qualitative

study of U.S. Affiliates of foreign Multinational companies, Doctor of Philosophy thesis,

The Pennsylvania State University, USA.

Marshall, J. 2007, How to Succeed at Succession, Financial Executive: October, Vol.23, no.

8, pp. 37-40.

Maunganidze, L (2008). Succession Planning and Business Survival at Crossroads: The case

of family controlled businesses in Harare, Doctor of Philosophy in Sociology thesis,

University of Zimbabwe, Zimbabwe.

Mehrabani, S. E, Mahomad, N. A (2011) Succession Planning: A necessary Process in

Today’s Organisation. International Journal of e-Education, e-Business, e-Management and

e-Learning, Vol. 1, No. 5.

Monetary Policy Statement.January 2015, Reserve Bank of Zimbabwe.

Muhammad , B . Muhammad , T . A and Muhammad , A . ( 2008 ) . Pakistan Journal of

Statistics and Operation Research . Volume 4 Number 1 .

journal.vaggi.org/index.php/bfowse/index/191. [ Accessed 20.12.15 ]

81

Mwemezi, D.B (2011). Challenges facing Human Resources Succession Planning in

Tanzania Work organisations: A case of public and private work organisations based in Dar

es Salaam, MBA Dissertation, Open University of Tanzania, Tanzania.

Nassor, A.T.A (2013). Succession planning among commercial banks in Kenya, Masters in

Business Administration Dissertation, University of Nairobi, Kenya.

Noe, R.A., Hollenbeck, J.R., Gerhart, B., (2008) Fundamentals of Human Resource

Management. Irwin/McGraw-Hill

Perecman Ellen and Sara R Curran 2006).A handbook for social science field research.

Rothwell, W.J. (2010). The future of succession planning. T+D, September 2010, 51-54.

Rothwell, W.J. (2010a). Effective Succession Planning: Ensuring Leadership Continuity and

Building Talent from Within. 4th edition. New York: American Management Association.

Ruppe, L. 2007, Be structured in managing talent. Don’t leave sustainable competitive

advantage to chance. Development and Learning in Organisations. Vol. 21, no. 3, pp.31-34.

Steele, P (2006) Succession Planning, White Paper (Revised), Regis Learning Solutions.

to the International Peace Academy’s Seminar on Sanctions”, New York City

UK Essays. November 2013. Risks Faced By Banks. Available from:

http://www.ukessays.com/essays/banking/risks-faced-by-banks.php?cref=1 [Accessed

5/10/2015].

Wilson, A. (2006). Marketing Research: An Integrated Approach, 2nd Edition, Prentice

Hall.

White, B. (2000) Dissertation skills for Business and Management students, Continuum.

Woodsong, M. N, Macqueen, C, Guest, K.M and Namey. E, (2005), “Qualitative Research

Methods: A collector’s field guide” Family Health International

Yin, R.K. (2009).Case Study Research Design and Methods 4th Edition Sage.

Yin R.K. (2009).Case Study Research Design and Methods 3rd Edition Sage.

82

http://docplayer.net/1316243-Succession-planning-your-bank-s-future-leadership.html

[17/08/2015]

http://www.herald.co.zw/mawocha-appointed-afrasia-bank-md/[accessed 16/02/2016]

https://www.dailynews.co.zw/articles/2015/01/06/matemera-appointed-afrasia-bank-md

[Accessed 16/02/2016]

83

APPENDICES

1. Interview Questionnaire.

2. Academic Research letter (University of Zimbabwe).

84

Appendix 1

My name is Rufaro Jessie Mutasa (R021491F); I’m studying towards a Masters Degree in

Business Administration at the University of Zimbabwe. I’m conducting a research study on

the implementation of Succession planning practice in the Zimbabwean banking Industry

and would be grateful if you could take time to answer the questions I have on the stated

subject matter. I specifically chose you because of your experience, knowledge and

exposure. Your responses will enable me to make inferences which would be of use to the

University of Zimbabwe’s academic body of knowledge, policy makers in the Human

Resources Management field and stakeholders in the banking industry. All information and

data obtained from you will be treated as strictly confidential and anonymous.

SECTION “A” DEMOGRAPHICS (Please tick/highlight appropriate boxes)

1. Please tick your age category.

20-25 yrs 26-30 31-35 36-40 41-45 46-50 51-55 56 plus

3. What is your current position/capacity in your organisation/bank?

CEO EXECUTIVE HEAD MANAGER OTHER (Please specify)

4. What is your professional background?

Finance HR Corporate

Banking

Retail

Banking

Accounting Other (Please specify)

85

5. How long have you been in the banking industry?

5 years or less 6-10 years 11-15 years 16-20 years Plus 21years

6. How long have you been in your current position?

5 years or less 6-10 years 11-15 years 16-20 years Plus 21years

7. Please state your level of education.

Certificate Diploma Degree Masters Other(Specify)

SECTION “B”: STATE OF THE CURRENT SUCCESSION PLANNING PRACTICE

1. How does your organisation usually replace personnel in executive roles?

Externally

Internally

I do not know

(Please explain)

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

2. What is your view on succession planning? Please tick appropriate boxes and

explain.

It is a necessary talent management tool

It is not very important

It is a regulatory compliance issue

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

86

3. How does the organisation/ bank identify candidates for succession?(Please tick

appropriate boxes)

Qualifications

Experience

Expertise

Performance

Tenure

Other(Please specify)

4. What is your view regarding developing internal candidates for promotion to critical

positions versus hiring externally? (What are the pros and cons) Please explain.

Good Bad I don’t know

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

5. Is succession planning incorporated into the bank’s strategic plan? Please explain.

Yes No I do not know

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

6. In your view, does the Zuva petroleum ruling that empowered employers to give

employees three months’ notice of employment termination have an impact on the

succession planning practice in your organisation/bank?

....................................................................................................................................................

....................................................................................................................................................

87

....................................................................................................................................................

....................................................................................................................................................

7. Which human resources management tools or activities do you utilise to manage

knowledge transfer? (Preserving institutional memory).

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

8. What developmental plans do you use to narrow the gap between the selected

successors’ present work needs and future work requirements? (*If internal

succession)

Job rotation

Job enrichment

Training

Coaching

Mentoring

Other (Please specify below)

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

9. What kind of HRM indicators (if any) do you use to evaluate your succession

planning initiatives? (How do you evaluate Succession Planning in your

Organisation?)

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

88

....................................................................................................................................................

....................................................................................................................................................

10. Is succession planning beneficial to organisational long term sustainability? Please

explain how so.

Yes No I do not know

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

11. Overally, how would you rate your organisation’s current succession planning

process? Please explain.

1 2 3 4

poor fair good Excellent

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

SECTION “C”: SUCCESSION PLANNING CHALLENGES

1. In your view, what challenges affect the effectiveness of the succession planning

process? (Please tick all appropriate)

Lack of management support

Lack of communication

Lack of budget

Too much focus on planning instead of outcomes

Inadequate HR systems and policies

The mirror effect of management

Other (Please specify below)

89

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

SECTION “D”: SUCCESSION PLANNING STRATEGIES

1. What do you think can be done to improve succession planning as a talent

management tool?

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

CONCLUSION

Apart from what we have discussed, is there anything else that you would want to share

with me which you think might be useful to my research?

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

....................................................................................................................................................

End of Interview

Thank you very much for your time.

90

Appendix 2

gsm mba dissertation

Documents