Though it's probably the least of his worries, Michael Eisner's recent troubles at the Walt Disney Co. have put the spotlight on succession planning. Eisner, of course, has been criticized for his failure to groom his replacement (among other things). But though the press coverage may have given that impression, succession planning isn't just a concern with CEOs or with large conglomerates. No matter how big or small the company, it's wise to groom capable people to take over any and all key functions. Indeed, a succession plan will be most effective if it covers the entire company, from bottom to top.

The benefits of lining up a strong bench—grooming, say, your current distribution manager to become your next vice president of distribution—are obvious: it helps keep your best people happy, fulfilled and focused on their future with the company. But the benefits of succession planning extend far beyond matters of retention.

For one thing, the company stands to save time and money, not the least of which are the expenses associated with hiring, training and even orientation. For another, bringing people up through the ranks lets you maintain continuity while still benefiting from a fresh perspective. And when you groom candidates from within, you invest your time training people you already know are a good fit with the company's culture.

Building a strong bottom-to-top succession plan cannot be done overnight. Finding those employees you want to retain and keeping them happy is a multi-step process. Here are some programs you can implement to begin that process.

1. Hire interim executives when needed for shortterm guidance. These executives, who are typically hired to oversee a project or manage a change initiative, often provide a welcome outside perspective when it comes to identifying the best internal candidates for management development and mapping out career paths. They can provide the objectivity not often available from internal management.

2. Institute a cross-training program. Putting people to work in different areas lets lower-level employees improve their skills and increases their value to the company. It also gives department managers backup for those times when a key employee is absent or on vacation and gives employees the opportunity to train for promotions. But don't do this unless an opportunity to advance truly exists. Enticement without rewards is meaningless.

3. Consider job sharing and other flexible scheduling options. Finding good people is one thing. Keeping them is another.Many times, an employee's tenure is interrupted by events outside the workplace. But that doesn't have to spell the end of that employee's career with your company. Allowing people to step back from full-time work when a life crisis interferes and share a job will help keep your company functioning smoothly. That flexibility helps you keep valuable employees who might otherwise be derailed by a temporary crisis and gives the company that all-important continuity.

When you evaluate your bottom-to-top succession plans, keep in mind that you're striving for continuity with an occasional infusion of new blood in the form of outside hires. This policy is reassuring to your staff, making them feel more comfortable in your employ. When they don't have to spend their days worrying about losing their jobs, they're better able to focus on helping the company grow and prosper.

Research shows that most people crave the safety and security of lifetime employment with a single company—just as their fathers and grandfathers had. Give them a future with your company, and they will give the company a future.