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KASB INSTITUTE OF TECHNOLOGY

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MBA WEEKEND

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METHODS IN BUSINESS RESEARCH
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RESEARCH REPORT ON
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“EFFECT OF SUCCESSION PLANNING”

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SUBMITTED BY: COURSE INCHARGE:

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S.M.FURQAN SH. ASIM ATHAR.

I.D. # 2114
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Dedicated to,

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My beloved parents,
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most respected teacher Asim Athar

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and all the colleagues of my class

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EMERGENCE OF SUCCESSION PLANNING IN

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HEALTH CARE UNITS.
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A CASE STUDY OF BARRETT HODGSON PAKISTAN
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(PVT.) LTD.
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 PREFACE

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I would like to express my gratitude to all those who gave me the possibility to
complete this research. I am deeply indebted to my supervisor Mr. Asim Athar

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whose help, stimulating suggestions and encouragement helped me in all the time of
research for and writing of this report. My former colleagues from the class who
supported me in my research work. I want to thank them for all their help, support,

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interest and valuable hints ON
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 ACKNOWLEDGEMENT

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We want to show our sincere gratitude to all those who made this study possible. First of all, we

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are very thankful to the helpful staff and all the faculty of KASBIT management. One of the most

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important tasks in every good study is its critical evaluation and feedback which was performed
by our supervisor Mr.Asim Athar. We are very thankful to our supervisor for investing his
precious time to discuss and criticize this study in depth, and explained the meaning of different

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concepts and how to think when it comes to problem discussions and theoretical discussions.
All this, made our tasks very interesting and challenging for us, it also provided us an
opportunity to remove any flaws and weaknesses. So openly and warmly welcomed us to use

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previous observations and take in-depth interviews and discussions about the work. Our sincere
thanks go to our family members, who indirectly participated in this study by encouraging and
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supporting us.
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S.M.FURQAN

I.D. # 2114.
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S. No Table of Content Page No

Abstract.

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Acknowledgement.

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CHAPTER 1: Company’s Background

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1 1.1 Vision 11

2 1.2 Mission(s) 12

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3 1.3 Strategy 13

5 1.4 Company History 14

6 1.5 products. 16-19

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7 CHAPTER 2 : Literature Review
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8 2.1 Succession Planning: A concept. 21

9 2.2Effect of Organizational Factors. 22

10 2.3Role of Succession practices. 22

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11 2.4 Outcomes 22-23

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12 2.5 Impact of Support and Training. 23-24

13 2.6 Impact on Strategic Activity. 24

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14 2.7 Seek Transparency. 24

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15 2.8 Knowledge of Executive Performance. 25

16 2.9 Succession vs. Replacement Planning. 25

2.10 Impact of Organizational Culture.

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17 26

18 2.11 The successors challenge. 26

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19 2.12 higher level of employer engagement. 27

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2.13 Effect of in group Biasing.

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20 27

2.14 Problem Definition. 28

CHAPTER 3 :M e t h o d o l o g y

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22 3.1 Hypothesis. 30-31

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23 3.2 Reasearch Design. 32

24 3.3 Sampling Design. 33-34

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CHAPTER 4 : Data Analysis

25 4.1 Hypothesis Testing. 36-44

26 4.2 Hypothesis Observation. 45

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CHAPTER 5 : Conclusion & Recommendation
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27 5.1 Conclusion 47

28 5.2 Recommendation 48
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References 49-50
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Appendix: Questionnaire 51-56

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Abstract

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Succession planning is a critical tool for ensuring lasting organizational improvement.
However, the biggest challenge for most organizations is how to effect a well-designed

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change of leadership without disrupting the organizational continuity. This paper
contends and discusses a big issue in local organization that whether effective
succession planning lowers employees turnover or not as most organizations are
on the verge of transition crisis. Based on the literature review, succession is a crisis in

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the Local and the whole developed world. This paper suggests ways to cope with the
looming situation and gives reviews of employees working in different environment and
cultures regarding what they think about succession planning, what factors are
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important for effective succession planning and how organizational problems can
be overcome by effective succession planning.
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Chapter 1

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Company’s Background
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 1.1 Vision

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“TO MAKE BARRETT HODGSON AMONG TOP 10
PHARMACEUTICAL COMPANIES OF PAKISTAN TILL 2014”

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 1.2 Mission(s)

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Barrett Hodgson Pakistan while maintaining its
entrepreneurial posture would remain sympathetic to ailing
humanity.

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 1.3 Strategy

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With dynamic leadership and strong and competent
management team Barrett Hodgson stands out as a high

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standard, quality conscious company, which is comparable
to any pharmaceutical concern in Pakistan and elsewhere.

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To remain one of the fastest growing companies, Barrett
Hodgson is continuously introducing new and innovative
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products along with rapid expansion in its sales force.
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1.4 Company History

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Barrett Hodgson Pakistan (Private) Limited was incorporated in Pakistan on September
2, 1992, and became operational on January 20, 1996.

Barrett Hodgson is a well known name in the pharmaceutical industry of Pakistan. The

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Company is also known due to its overseas partners in Pakistan. Barrett Hodgson has
major licensing arrangements with Astra (now Astrazeneca), Fujisawa (now Astellas)
Japan, Allergan USA, Fujisawa (now Astellas) Deutschland, GmbH, Germany, and
MIKA GmbH Germany.

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 1.5 Quality policy

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Barrett Hodgson is committed to implement and maintain the Quality Management
System in order to obtain the consistent quality products and services to meet the
customer, cGMP and the regulatory requirements.

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Barrett Hodgson strives for continuous improvement through establishing and reviewing
the quality objectives, training to its employees, and adoption of latest techniques and
the implementation of documented procedures at all levels.
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 1.6 Products

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Barrett Hodgson has strong research based quality products to fulfill the needs of
medical profession in quite a number of therapeutic areas such as respiratory, gastro-
intestinal, cardiovascular, pain control, flu and cold, analgesics, antibiotics, ophthalmic

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(medical) and variety of other products. Barrett Hodgson will continue to introduce

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innovative and exciting new products in the coming years not only in the existing
therapeutic segments but also in other areas such as CNS, antivirals, Metabolic
disorders and other high-tech products.

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Following are some of the running products of BH,

Product Name Generic Therapeutic Class

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Anti-ulcerants (H2-
ACICON SUSPENSION 60ml Famotidine
antagonists)
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Anti-ulcerants (H2-
ACICON TABLET 20mg 10's Famotidine
antagonists)
Anti-ulcerants (H2-
ACICON TABLET 40mg 10's Famotidine
antagonists)
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AEROKAST 10mg Leukotriene Receptor

Montelukast sodium
CHEWABLE TABLET 14's Antogonists
Leukotriene Receptor
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AEROKAST 4mg TABLET

Montelukast sodium
14's Antogonists
AEROKAST 5mg TABLET Leukotriene Receptor
Montelukast sodium
14's Antogonists
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ALPHAGAN OPHTHALMIC
Brimonidine tartrate Anti-glaucomas
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SOLUTION 5ml
Cardiovascular [Calcium
AMPRESS 10mg TABLET
Amlodipine besylate Antagonists (Anti-
20's
hypertensives)]
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Cardiovascular [Calcium
AMPRESS 5mg TABLET 20's Amlodipine besylate Antagonists (Anti-
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hypertensives)]
Bronchodilators (long-
BAMBEC TABLET 10mg 30's Bambuterol HCl
acting)
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Bronchodilators (long-
BAMBEC TABLET 20mg 30's Bambuterol HCl
acting)
BETAGAN LIQUIFILM 0.5% Levobunolol HCl 0.5% Anti-glaucomas
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 STERILE 5ml

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Cardiovascular
BETALOC ZOK 100mg Metoprolol succinate
(Betablocking agents,
TABLET 30's (ZOK formulation)
plain)

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BINADEX OPHTHALMIC Ophthalmic Anti-
Dexamethasone
DROPS 5ml inflammatory
Sulphacetamide 10%,

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BLEPHAMIDE LIQ. STR. prednisolone acetate Ophthalmic Anti-infectives
OPHT SUSP 5ml 0.2% & phenylephrine & Anti-inflammatory

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0.12%
Sulphacetamide 10%,
BLEPHAMIDE SOP STR Ophthalmic Anti-infectives
prednisolone acetate
OPHT OINT 3.5gms & Anti-inflammatory
0.2%

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BRICANYL INHALER
Terbutaline sulphate Bronchodilators
400doses
BRICANYL INJECTION 5's Terbutaline sulphate Bronchodilators

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BRICANYL SYRUP 60ml Terbutaline sulphate Bronchodilators
BRICANYL TABLET Bronchodilators
Terbutaline sulphate
(BLISTER PACK) 100's
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Cephalosporins -
CEFAMEZIN IV-IM
Cefazolin sodium injectable (Systemic anti-
INJECTION 250mg
infectives)
Cephalosporins -
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CEFAMEZIN IV-IM
Cefazolin sodium injectable (Systemic anti-
INJECTION 500mg
infectives)
Cephalosporins -
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CEFAMEZIN IV-IM
Cefazolin sodium injectable (Systemic anti-
INJECTION 1000mg
infectives)
Cephalosporins -
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CEFCOM INJECTION
Ceftazidime injectable (Systemic anti-
1000mg 1's
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infectives)
Cephalosporins -
CEFCOM INJECTION 250mg
Ceftazidime injectable (Systemic anti-
1's
infectives)
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Cephalosporins -
CEFCOM INJECTION 500mg
Ceftazidime injectable (Systemic anti-
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1's
infectives)
Cephalosporins -
CEFIZOX IV-IM INJECTION
Ceftizoxime sodium injectable (Systemic anti-
1000mg
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infectives)
CEFIZOX IV-IM INJECTION Cephalosporins -
Ceftizoxime sodium
500mg injectable (Systemic anti-
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 infectives)

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Cephalosporins -
CEFIZOX IV-IM INJECTION
Ceftizoxime sodium injectable (Systemic anti-
250mg
infectives)

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CEFSPAN 400MG CAPSULE Cephalosporins - oral
Cefixime
5's (Systemic anti-infectives)
CEFSPAN DS SUSPENSION Cephalosporins - oral
Cefixime

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30ml (Systemic anti-infectives)
Cephalosporins - oral

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CEFSPAN SUSPENSION
Cefixime
30ml (Systemic anti-infectives)
CHLOROPTIC OPHTHALMIC
Chloramphenicol Ophthalmic Anti-infectives
SOLUTION 10ml

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Fluoroquinlones, Topical
CIPOCAIN, STERILE EAR Ciprofloxacin +
Anti-Infective Local
DROPS 1's Lignocaine base
Anasthetics
CIPOTIC, STERILE EAR Fluoroquinlones, Topical
Ciprofloxacin

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DROPS 1's Anti-Infective
CIPOTIC-D, STERILE EAR Ciprofloxacin + Fluoroquinlones, Topical
DROPS 1's dexamethasone Anti-Infective + Steriod
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Clopidogrel (as ADP RECEP ANTAG PLAT
CLOTNIL 75mg TABLET 10's
clopidogrel bisulphate) INH (B01C2)
Anti-Diabetics
DIABOLD 1mg TABLET 20's Glimepiride
Sulfonylureas
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Anti-Diabetics
DIABOLD 2mg TABLET 20's Glimepiride
Sulfonylureas
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Anti-Diabetics
DIABOLD 3mg TABLET 20's Glimepiride
Sulfonylureas
Anti-Diabetics
DIABOLD 4mg TABLET 20's Glimepiride
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Sulfonylureas
Gastrointestinal
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DOMEL SUSPENSION 60ml Domperidone

(Gastroprokinetics)
Gastrointestinal
DOMEL TABLET 50's Domperidone maleate
(Gastroprokinetics)
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Anti-depressants (SSRI-
ERADEP 20mg TABLET 14's Citalopram Selective Serotonin
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Reuptake Inhibitors)
ESEGROW SUSPENSION 60 Ossein Microcrystalline
Calcium Supplement
ml hydroxyapatite
Ossein Microcrystalline
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ESEGROW TABLET 30's Calcium Supplement

hydroxyapatite
EXOCIN OPHTHALMIC
Ofloxacin Ophthalmic Anti-infectives
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SOLUTION 5ml

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 EXOCIN S.O.P

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OPHTHALMIC OINTMENT Ofloxacin Ophthalmic Anti-infectives
STERILE 3.5gm
EYEBRADEX EYE DROPS Tobramycin 0.3% & Ophthalmic Anti-infectives

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5ml Dexamethasone 0.1% & Anti-inflammatory
EYEBREX OPHTHALMIC
Tobramycin Ophthalmic Anti-infectives
SOLUTION 5ml
FEBROL DS SUSPENSION

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Paracetamol Non-Narcotic Analgesics
60ml

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FEBROL SUSPENSION 60ml Paracetamol Non-Narcotic Analgesics
FEBROL TABLET 200's Paracetamol Non-Narcotic Analgesics
FEBROL XTRA TABLET Paracetamol +
Non-Narcotic Analgesics
Caffeine

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100's
FML FORTE LIQ. STR. Fluorometholone Ophthalmic Anti-
OPHT. SUSP 5ml 0.25% inflammatory
FML LIQUIFILM STR. OPHT. Ophthalmic Anti-
Fluorometholone 0.1%

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SUSP. 5ml inflammatory
FML NEO LIQ. STR. OPHT. Fluorometholone 0.1% Ophthalmic steroids &
DROPS 5ml & Neomycin 0.5% Anti-infectives
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Sibutramine
GetSet 10mg Capsule 14's Anti-obesity preparations
hydrochloride
Sibutramine
GetSet 15mg Capsule 14's Anti-obesity preparations
hydrochloride
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GIXER ORAL SOLUTION Anti-Histamine Selective

Cetirizine HCl
60ml H1 receptor antagonists
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Chapter 2

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Literature Review

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 2.1 Succession Planning: A Concept

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Healthcare organizations, in particular, may stand to benefit from effective succession

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planning, for several reasons. For one, healthcare organizations are complex and highly
political environments; as such, it can take considerable time and effort for outsiders to
learn to navigate them. Additionally, many employees are drawn to the healthcare field
at least in part for its stability and predictability. Smooth transitions between top-level

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leaders can assist in maintaining this stability, in fact and appearance, at all times.

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Integrated model of succession planning process.

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 2.2 Effect of Organizational factors

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The organizational environment significantly influences the succession planning process

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(e.g., Cannella & Lubatkin, 1993). The strongest influence on succession planning is
historical precedent (Ocasio, 1999): quite simply, succession planning is most likely to
take the form of prior approaches, or lack thereof. Assuming that succession planning is
taking place, the specifics of the process will be affected by the other environmental

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factors listed in Figure

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According to author, succession planning strategy varies with organization to
organization. Author believed that various factors are there in organization that
influences succession planning.

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2.3 Role of Succession practices
Although succession planning practices vary considerably from organization to

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organization, an underlying structure common to all can be identified.

Organizations differ in terms of the extent to which responsibility for candidate

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identification rests with the CEO versus the Board Chair, or in combination with other
key stakeholders (Schleifer & Summers, 1988; Vancil, 1987). In terms of who is
eligible for consideration, hospitals may employ “first-cut” criteria for experience (e.g., a
certain number of years in an executive leadership position) and education (e.g., an
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M.D. and/or MBA/MHA/MPH). The identification process itself may vary from highly
informal to highly structured; the latter may include formal assessment processes using
objective outside counsel. Candidates may be identified from within the organization, or
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outsiders can be brought in to assume a temporary role (e.g., EVP or COO) in

anticipation of succeeding to the CEO role. Once the successor is identified, a
preparation phase begins.
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According to authors, succession practices depends on the position itself, according to

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them planning in hospitals (health care units) depends on leadership positions, their
professional experiences, qualification, number of working experience in professional
discipline.
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2.4 Outcomes
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The ultimate goals of succession planning typically involve improved organizational

performance. Studies of succession outcomes typically sought to evaluate the utility of
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succession practice via study of, for example, perceptions of stability and financial
performance (Kotter, 1982). Although multi-organization evaluation studies of
succession planning remain relatively uncommon (for exceptions see Conger & Fulmer,
2003; Karaevli & Hall, 2003), these evaluation studies have yielded a number of
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 important findings, particularly in relation to the implications of internal versus external

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successors. External succession will often be interpreted as below-expectations
performance on the part of the incumbent (Dyl, 1985; Friedman & Singh, 1989;
Lorsch & MacIver, 1989) and/or fundamental differences between the executive

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leadership and the board (Faith, Higgins, & Tollison, 1984).

According to authors, the ultimate results of succession planning are to increase

organizational productivity although it is quiet difficult to measure the outcome of
succession panning.

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They believed that external succession is more debatable in organizations as compared

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to internal succession.

• Greater likelihood to maintain current

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strategic vision
• Leads to homogeneous groups because of
Inside successors similarity in past experience and
organization tenure—more
cohesive/communicate more frequently/high

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level of integration
• More likely to follow in predecessor’s
footsteps
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• Greater likelihood to experience significant
strategic change
Outside successors • Leads to more heterogeneous work
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group—challenge existing viewpoints/more

solutions
• Represents new power base because of
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few ties to the old system

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2.5 Impact of Support and Training

Even though succession planning ensures a qualified applicant of new deans, strong
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support needs to be in place to retain them. One particularly beneficial support is

feedback from the dean’s immediate supervisor. Receiving performance feedback
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needs to be a regular occurrence; expectations need to be clearly articulated. The

individual must be apprised of how evaluation will take place and what constitutes
success. The duties of the role are extensive; it is imperative for a new dean to know
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what responsibilities are priorities. Since much of a dean’s work is viewed subjectively
by different constituents, it is important that dean’s supervisor provide objective
evaluation of the duties performed (Wolverton, Wolverton and Gmelch 1999).
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 Leadership can be very lonely. Ample opportunities to establish quality relationships

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with supervisors and other deans should be provided (Johnsrud, Heck and Rosser
2000). Assistance in finding a mentor that can serve as a trusted advisor, provide
insights and direction, and offer ongoing feedback advised (Wolverton, Wolverton and

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Gmelch 1999).

According to authors, proper feed back & Training of personnel helps organization to
transit the deserving candidate to the key positions. Performance feed back help

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employees to groom themselves into most responsible organizational positions.

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2.6 Impact on Strategic Activity

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It is important to link succession planning to the organization’s long-term strategic plans.
Strategic planning identifies the capabilities required by the organization and its staff to
achieve its objectives. Strategic plans should inform future needs around staffing, and in
turn identify required capabilities, career progression, promotion processes, and the
strategies being used on and off-the-job to grow talent. (Paese 2002)

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According to author, right succession planning lead to right strategic activities within the
organization. It helps to identify future staffing need, career progression etc.
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2.7 Seek transparency

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There is evidence from best practice, as well as from research, that the succession
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process needs to be as transparent as possible Conger and Fulmer (2003) In

particular, this requires good communications, clear policy and numerous opportunities
for the succession planning process to be reviewed to assist its continued development.
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If an organization is not open to regular review, for example, succession planning can
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come to be seen as a highly political process. One symptom is when the views of
individual managers around the capabilities of their staff are frequently at odds with
advice from other sources.
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According to authors, succession planning should be transparent, it is necessary to

avoid organizational biasness that every key position should be carefully evaluated and
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filled by right person with consensus.

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 2.8 Knowledge of Executive

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Performance

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The actions of executives are not perfectly observable. Also, outcomes (e.g. increases

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in profit) are often driven partly by executives’ efforts and partly by external factors.

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Performance measurement systems need to accommodate the relative weightings of
agent actions and exogenous factors that may affect outcomes.
In designing appropriate performance measures, recourse to the ‘informativeness
Principle’3 is appropriate. Essentially, the use of performance metrics should be limited
to those that improve information about the actual performance of the executive.

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Bonuses that are based on performance metrics that cannot be tied back to
management effort are not appropriate. (Gibbons and Murphy 1990)

According to author, it is difficult to quantify actual performance of key position holders.

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The established HR assessments are not sufficient to evaluate the performance.
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2.9 Succession versus Replacement
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Planning
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Replacement planning is a means of managing for risks by simply replacing personnel

(Rothwell, 1994). The term “replacement ready” is commonly used interchangeably
with “succession planning,” but the two concepts differ in a very crucial way. Succession
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planning focuses on strategic and systematic capability and capacity readiness.

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Succession planning is strategic rather than reactive, using goal setting and analysis of
Capability together to develop a plan of action to make a successful strategic transition
from one qualified individual to his or her replacement. Formal succession planning
embraces not only crisis-response replacement actions but also emphasizes a Strategic
proactive philosophy (Fairfield-Sonn, 2001).In contrast; replacement planning is mainly
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a maintenance process. It is characterized by having no formal plan in place because

the replacement planning focuses on damage control in response to some unexpected
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happening (Fairfield-Sonn, 2001).

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According to authors, replacement and succession planning are quiet different

concepts. Replacement is simply throw the person out the company, succession is
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 rather a upraising the desired and motivated employee to the key position after doing

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critical analysis of that person or employee.

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2.10 Impact of Organizational Culture

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The values, mission, and vision of an organization are artifacts of the organization’s

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culture. The values of the organization speak to the beliefs of the organization and are
influenced by the people who make up the organization. The mission speaks to the
purpose of the organization. The vision speaks to the future goals of the organization.
Fairfield-Sonn (2001)

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The impact of culture becomes a critical piece when determining successors because
successors may or may not embrace the norms of the culture of the organization for
which they will become responsible.

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Authors mentioning that organizational culture for successor a critical role in upgrading
the right person, it is important that culture should be professional and no dispute of any
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kind must be there in the result of succession planning Corse.
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2.11 The Successor’s Challenge

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For the successor, the visualization of his or her own career is often hard to imagine
without some notion of his or her future fit in the current organization. This includes
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knowing the climbing frame in the structure of the organization in order to conceptualize
a future career path (Gunz, 1989).
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According to author it is also important to categorize and evaluate himself in the

organization that in which scenario he or she is going to fit or suitable.
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 2.12 Higher Levels of Employee

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Engagement

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Employees whose careers are being developed are more likely to report higher levels of
engagement. In other words, they are more likely to be committed to the organization,

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are more likely to take pride in their work, and are more likely to work hard at what they

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do. (Perrin, 2006)

According to author, it is fruitful for the organization that its employee should remain
loyal to company. Succession planning in right direction helps the organization to

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achieve the same.

2.13 Effect of In-group Biasing

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One of the main effects of the differentiation of in-groups and out groups is the creation
of in group bias or ethnocentrism which is the more positive evaluation of the in group
than the out group (Sumner, 1906). The most direct impact of the positive evaluation of
the in group is more resources tend to be allocated to the in group thus reinforcing this
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in group belief. Thus, once receiving organizational endorsement such as through a

succession plan process, there could be a cumulating process of biasness. Also, with
taking into account Social Identity Theory it is easy to see why the in-group/out group
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biasing continues. Tajfel and Turner (1986) state that social identity is the self-
conceptualization derived from emotionally significant groups.
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According to author, biasing is a negative factor that can ruin the efficient process within
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the organization.
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 2.14 Problem Definition

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What practices should follow for effective

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succession planning?
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Chapter 3

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Methodology
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 3.1 Hypothesis

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Increase Efficient Decrease employee

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succession turnover
Planning

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Ho1: Increase in efficient succession planning do not

lower employee turnover.
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HA1: Increase in efficient succession planning do lower

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employee turnover.
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Ho2: Increase in efficient succession planning do not

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increase retention of employees.

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HA2: Increase in efficient succession planning do

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increase retention of employees

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Ho3: Higher supervisor supports do not increase
succession planning.

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HA3: Higher supervisor supports do increase succession
planning.

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ON
Ho4: There is no significant relationship between
succession planning and career development.
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HA4: There is relationship between succession planning

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and career development

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 3.2 Research Design

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Purpose of the Study

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This article reveals a Descriptive study.

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Type of Investigation

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It is a Causal study based on causes of succession planning and its effect.

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The Researcher Interference ON
This study has moderate researcher interference.

Study Settings
SE

It is a non- contrived study based on field experiment.

PO

The Unit of Analysis

R
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This study based on Individual unit of analysis.

Time Horizon
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EM

Its across-sectional time horizon based study.

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 3.3 Sampling Design

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CO
 Population: All employees of


T
Element: Barrett Hodgson Regional Office Karachi


NO
Unit: having salary above 30,000
 Extent: in Quality Assurance department working
 Time: at least two years.

DO
Sampling Frame – list of all Quality Assurance
department Employees.

LY
ON
Sampling Unit – all employees having salary above
30,000 and could be successor.
SE
PO

Sampling Method – Disproportionate

R

Sampling Size – 30
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 Sampling Plan-

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I visit individually all the employees that are under my
sampling frame, describe them my purpose and nature of study then collect data
through questionnaire (shown in appendix)

CO
Select the sample – My sample include all executives and senior

T
executive members who could be potential successors and having knowledge about

NO
basic HRM functions.

DO
LY
ON
SE
R PO
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CO
T
NO
DO
Chapter 4

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Data Analysis
ON
SE
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 4.1 Hypothesis Testing

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CO
Question No = 06 Employee Retention.

What do you think should be the main purpose(s) of succession management in

T
the organization?

NO
To easily identify replacements to fill key positions

DO
To develop employees for future

To achieve strategic goals of organization

To retain organizational talent for longer period

TOTAL
LY 100
ON
CHI-SQUARE (Goodness of Fit Test)
SE

Observed Expected

Attributes Frequency Frequency (O-E) (O-E)2 (O-E)2/E

PO

"O" "E"

To easily identify
R

replacements to fill key

01 7.5 -6.5 42.25 5.63
PU

positions
7.5
To develop employees for
10 2.5 6.25 0.833
future
IC

7.5
To achieve strategic goals
01 -6.5 42.25 5.633
EM

of organization
7.5
To retain organizational
18 10.5 110.25 14.7
talent for longer period
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Total 30 30 26.796
AC

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 Degree of Freedom D.F = (K-1)

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Degree of Freedom D.F = (4-1)

D.F Degree of Freedom (df) = (3)

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Level Of Significance

T
NO
∞ = 0.05 ∞ = 0.01

Χ2 Cal = 26.796 Χ2 Cal = 26.796

DO
Χ2 Tab =7.82 Χ2 Tab =11.34

LY
ON
SE
R PO

∞ = 0.05
PU

Χ2 Cal = 26.796 Χ2 Tab =7.82

IC
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 PY
CO
T
NO
DO
∞ = 0.01

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Χ2 Cal = 26.796 Χ2Tab =11.34
ON
SE

H0 REJECTED
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HA ACCEPTED
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 Question No = 15 Supervisor support.

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CO
Do you think supervisor support is important in succession planning?

Yes No

T
CHI-SQUARE (Goodness of Fit Test)

NO
Observed Expected

Attributes Frequency Frequency (O-E) (O-E)2 (O-E)2/E

DO
"O" "E"

26 15 11 121 8.0666
YES

LY
04 15 -11 121 8.0666
NO
Total 30 30 16.133
ON
Degree of Freedom D.F = (K-1)
SE

Degree of Freedom D.F = (2-1)

D.F Degree of Freedom (df) = (1)

PO

Level Of Significance
R
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∞ = 0.05 ∞ = 0.01

Χ2 Cal = 16.133 Χ2 Cal = 16.133

IC

Χ2 Tab =3.84 Χ2 Tab =6.63

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TCO
NO
DO
∞ = 0.05

Χ2 Cal = 16.133 Χ2 Tab =3.84

LY
ON
SE
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PU
IC

∞ = 0.01

Χ2 Cal = 16.133 Χ2Tab =6.63

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H0 REJECTED

HA ACCEPTED
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Question No = 16 Employee Turnover.

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Is succession planning a good tool to decrease employee turn over?

Yes No

T
NO
CHI-SQUARE (Goodness of Fit Test)

Observed Expected

DO
Attributes Frequency Frequency (O-E) (O-E)2 (O-E)2/E

"O" "E"

LY
23 15 08 64 4.266
YES
07 15 -08 64 4.266
NO
ON
Total 30 30 8.532
SE

Degree of Freedom D.F = (K-1)

Degree of Freedom D.F = (2-1)

PO

D.F Degree of Freedom (df) = (1)

R

Level Of Significance
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∞ = 0.05 ∞ = 0.01
IC

Χ2 Cal = 8.532 Χ2 Cal = 8.532

Χ2 Tab =3.84 Χ2 Tab =6.63

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 PY
TCO
NO
DO
∞ = 0.05

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Χ2 Cal = 8.532 Χ2 Tab =3.84
ON
SE
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PU
IC

∞ = 0.01

Χ2 Cal = 8.532 Χ2Tab =6.63

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H0 REJECTED

HA ACCEPTED
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Question No = 1 Career Development.

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Do you think the development period should vary according to the level of the

T
position?

NO
Yes No

DO
CHI-SQUARE (Goodness of Fit Test)

Observed Expected

Attributes Frequency Frequency (O-E) (O-E)2 (O-E)2/E

LY
"O" ON "E"

28 15 13 169 11.266
YES
02 15 -13 169 11.266
NO
Total 30 30 22.533
SE
PO

Degree of Freedom D.F = (K-1)

Degree of Freedom D.F = (2-1)

R

D.F Degree of Freedom (df) = (1)

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Level Of Significance
IC

∞ = 0.05 ∞ = 0.01
EM

Χ2 Cal = 22.533 Χ2 Cal = 22.533

Χ2 Tab =3.84 Χ2 Tab =6.63

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 PY
TCO
NO
DO
∞ = 0.05

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Χ2 Cal = 22.533 Χ2 Tab =3.84
ON
SE
R PO
PU
IC

∞ = 0.01

Χ2 Cal = 22.533 Χ2Tab =6.63

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AD

H0 REJECTED

HA ACCEPTED
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4.2 Hypothesis Analysis

T CO
At 0.05 level of significance, the calculated values of the entire four established

NO
hypothesis appear to be greater than tabulated values. The significant variation
between calculated and tabulated values rejected the Null Hypothesis and accepted
the Alternate Hypothesis.

DO
It has also been checked at 0.01 level of significance he entire four established

LY
hypothesis appear to be greater than tabulated values. Hence we again reject the Null
Hypothesis and accept the Alternate Hypothesis.
ON
SE
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T
NO
Chapter 5

DO
Conclusions and Recommendations

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ON
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5.1 Conclusion

T CO
Succession Planning is an emerging concept in local scenario not only in health care

NO
units but in other corporate as well. In developing countries it is considered one of the
essential tool in HUMAN RESOURCE MANAGEMENT.

Retaining Employees

DO
From the above chapters and data analysis it is crystal clear by applying statistical tool
on established hypothesis that succession planning is an efficient to retain the smart
organizational talent. It helps management to discriminate between smart and hard

LY
workers.

Employees Turnover.
ON
Succession Planning is also helpful to reduce the employee turnover rate. According to
modern concept, organizations now consider their employees as important assets and
they try to retain their efficient employees.
SE

Career Development.

It is also noted in the data analysis that career development directly relates with
PO

succession planning i.e. greater is the succession planning higher will be the career
development.
R

Supervisor Support.
PU

Supervisor support plays an important role in efficient succession planning. The

procedure and practices of succession planning should be transparent and clear to
each employee so that biasness and other illegal barriers would be checked and
IC

removed. Potential successor should be elected with consensus decision made by

management.
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5.2 Recommendations

CO
Barrett Hodgson is renowned pharmaceutical organization in Pakistan. It has strong

T
manufacturing and distribution network.

NO
As far as this research is concerned, succession planning in BH is not as efficient as it
should be. In health care units it is essential to seek and retain their efficient employees
because in Pakistan more than 300 pharmaceutical units existed so if any organization

DO
do not meet the employee expectation, it is quiet obvious that the employee will switch
from one firm to another. In this regard I found several recommendations in order to
improve its succession planning system,

LY
 Succession Planning guidelines should be clear to all employees so that each
employee can evaluate himself/herself by own.
ON
 Succession planning guidelines should be periodically reviewed so that it
remains up to date according to the changing trends of organization.

 Potential successor should be well versed and knows the strategic goals of the
SE

organization.


PO

Succession planning is an open discipline to research especially in the field of health

R

care units. Succession management contributes to the professional development of

managers by exposing them to different developmental experiences such as task
PU

forces, job rotations, line-to-staff switches, and turnaround or fixit assignments. At the
leadership level, executive succession helps organizations groom and select the next
generation of leaders for more responsible positions
IC
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 PY
References.

CO
Alexander, J. A. & Lee, S. D. (1996). The effects of CEO succession and tenure on

T
failure of rural community hospitals. Journal of Applied Behavioral Science, 32,

NO
70-88.
Axel, H. (1994). HR executive review: Succession planning. New York: Conference
Board.
Beeson, J. (2000). Succession planning. Leading-edge practices: What the best

DO
companies are doing. Across the Board, pp 38-41.
Beeson, J. (1999). Succession planning: building the management corps. Business
Horizons, 61-66.
Bernthal, P, & Wellins, R.S. (2003). Leadership forecast: 2003-2004. Retrieved March
15, 2004, from http://www.ddiworld.com/pdf/CPGN50.pdf

LY
Buckner, M., & Savenski, L. (1994). Succession planning. In W.R. Tracey (Eds.) Human
resource management and development handbook. New York: AMACOM.
Cannella, A. A., & Lubatkin, M. (1993). Succession as a sociopolitical process: Internal
ON
impediments to outsider selection. Academy of Management Journal, 36, 763-
793.
Carey, D. C. & Ogden, D. (2000). CEO Succession: A window on how boards can get it
right when choosing a new chief executive. New York: Oxford University Press.
SE

Conger, J. A., & Fulmer, R. M. (2003). Developing your leadership pipeline. Harvard
Business Review, 81, 76-85.
Dyl, E. A. (1985). Reinganum on management succession. Administrative Science
PO

Quarterly, 30, 373-374.

Faith, R. L., Higgins, R. S., & Tollison, R. D. (1984). Managerial rents and outside
recruitment in the Coasian firm. American Economic Review, 74, 660-672.
Freidman, S. D., & Singh, H. (1989). CEO succession events and stockholder reaction:
R

The influence of context and event context. Academy of Management Journal,

32, 718-744.
PU

Garman, A. N., & Glawe, J. (2004). Research update: Succession planning. Consulting
Psychology Journal: Practice & Research, 56, 119-128.

Gomez-Mejia, L.R. and D.B. Balkin, 1992, Compensation, Organizational Strategy and
IC

Firm
Performance, Cincinnati, Southwestern.
EM

Hamel, G. and C.K. Prahalad, 1994, Competing for the Future, Cambridge, Harvard
Business School Press.
Holmstrom, B., 1979, ‘Moral Hazard and Observability’, Bell Journal of Economics, 10:
74-
AD

91.
Hyland, A. and N. Hooper, 2005, ‘Contract Chess: Banking Kings Look to the
Endgame’,
AC

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 Australian Financial Review, 4 March: 1.

PY
Jensen, M. and K. Murphy, 1990, ‘Performance Pay and Top Management Incentives’,
Journal of Political Economy, 98: 225-264.
Kroll, M.J., L.A. Toombs and H. Leavell, 1997, ‘Form of Control: A Critical Determinant

CO
of
Acquisition Performance and CEO Rewards’, Strategic Management Journal, 18: 85-96.
Lambert, R.A., D.F. Larcker and K. Weigelt, 1993, ‘The Structure of Organizational
Incentives’, Administrative Science Quarterly, 38: 438-461.

T
McMillan, J., 1992, Games, Strategies and Managers, New York, Oxford University
Press.

NO
Milgrom, P. and J. Roberts, 1992, Economics, Organization and Management, New
Jersey,
Prentice-Hall.
Porter, M., 1985, Competitive Advantage, New York, Free Press.

DO
Schumpeter, J., 1942, Capitalism, Socialism and Democracy, New York, Harper and
Row.
Shapiro, C. and H. Varian, 1999, Information Rules, Cambridge, Harvard Business
School
Press.

LY
Tosi, H.L., J.P. Katz and L.R. Gomez-Mejia, 1997, ‘Disaggregating the Agency
Contract: The
ON
Effcets of Monitoring, Incentive Alignment and Term in Office on Agent Decision
Making’
The Academy of Management Journal, 40: 584-602.
Tirole, J., 2001, ‘Corporate Governance’, Econometrica, 69(1): 1-35.
SE

Karaevli, A., & Hall, D. T. (2003). Growing leaders for turbulent times: Is succession
planning up to the challenge? Organizational Dynamics, 32, 62-79.
Lorsch, J. W. &MacIver, E. (1989). Pawns or potentates: The reality of America’s
PO

corporate boards. Boston: Harvard Business School Press.

Metz, E. J. (1998). Designing succession systems for new competitive realities. Human
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Ocasio, W. (1999). Institutionalized action and corporate governance: The reliance on
R

rules of CEO succession. Administrative Science Quarterly, 44, 384-416.

PU

Thrall, T. H. & Hoppszallern, S. (2001). Leadership survey. Hospitals & Health

Networks, 75,33-39.
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Appendix

T CO
QUESTIONNAIRE EMPLOYEES’ PERCEPTION OF SUCCESSION PLANNING &
MANAGEMENT

NO
This questionnaire is for business research purpose and for academic use only. The

DO
researcher is thankful for you participating in this process. All the information provided
would be kept confidential. Your time and effort are valued and appreciated.

Please answer the following questions by placing a check in the box which best

LY
indicates your response & choose only single option.
ON
PERSONAL INFORMATION.
SE
PO

Name__________________________________________________
R

Gender. ______________________________________
PU

Age. ______________________________________
IC

Working Experience.__________________________________________________
EM

Employer Name. ___________________________

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Mailing Address_____________________________________________

Page | 51
 PY
Question 1: How long have you been employed to this organization?

CO
0 - 5 years

6 - 10 years

11 - 15 years

T
16 - 21 years

NO
21 years and more

DO
Question 2: How important do you think it is for the organization a formal succession management

LY
system?

Very Important
ON
Important

Somewhat Important
SE

Not Important
PO

Question 4: In your opinion do you think it will be beneficial for the organization to implement a formal
R

succession management system?

PU

Yes No
IC
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 PY
Question 5: In your opinion, a succession management system would be successful at which managerial
level?

T CO
Tick Managerial level

NO
Top Management level

Middle Management level

Lower Management level

DO
At all Management level

LY
ON
Answer question 06& 07 by assigning numbers adjacent to each option so that the sum
would be exactly 100
SE

Question 6: What do you think should be the main purpose(s) of succession management in the
PO

organization?
R

To easily identify replacements to fill key positions

PU

To develop employees for future

To achieve strategic goals of organization

IC

To retain organizational talent for longer period

EM

TOTAL 100
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CO
Question 7: Please rate the following methods in terms of their effectiveness in identifying potential
successors?

T
NO
Self-nomination

Performance Evaluation Ratings

DO
Supervisor

Head of Department

TOTA L 100

LY
ON
SE

Question 8: Please rank which of the following methods would be most effective in assessing
development need? (1-4, rank 1 show least preferable while 4 shows most preferable.)
PO

Rank of Preference
R

Self Assessments ___________

PU

Annual Performance Evaluation Ratings ___________

Only supervisor’s evaluation ___________

IC

CEO evaluation ___________

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Question 9: Please rank the following activities in terms of their effectiveness in developing employees
(1-5, rank 1 show least preferable while 5 shows most preferable.)

CO
Rank of Preference

T
Job Rotation ___________

NO
Job Enlargement ___________

Job enrichment ___________

Coaching ___________

DO
On job Training ___________

LY
Question 10: Should personality tests be used to assess potential successors?
ON
Yes No
SE

Question 11: Do you think employees should be held totally responsible for their career plans?
PO

Yes No
R
PU

Question 12: Do you think the pharmaceuticals values efficiently enhanced learning and development?

Yes No
IC
EM

Question 13: Do you think the development period should vary according to the level of the position?
AD

Yes No
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Page | 55
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Question 14: Do you think the current employee promotion system is effective?

CO
Yes No

T
NO
Question 15: Do you think supervisor support is important in succession planning?

Yes No

DO
Question 16: Is succession planning a good tool to decrease employee turn over?

LY
Yes No ON
SE
R PO
PU

THANK YOU FOR YOUR PRECIOUS TIME.

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 AC

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RPO
SE
ON
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DO
NO
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