By Judith O’Neill*
WHEN Geoff Dixon announced some years ago that he would be stepping down as CEO of Qantas he was giving shareholders, staff, customers and the market-place plenty of notice of his intentions. He was also flagging that Qantas had in place succession planning – as would be expected.
It is an expectation that public companies will have succession plans in place both for their board and for their CEO’s and subsidiary companies and divisions.
However, this is not always the case and boards can find themselves embarking on a search if their CEO resigns suddenly or the board decides to “let them go”. Through lack of preparation and strategic planning the company will be open to scrutiny and criticism.
CEO succession all too often then becomes at best an exercise in damage control and at worst an unseemly scramble that can hurt a company and destroy staff morale and customer confidence. It is also an open invitation for the potential loss of the highest performers in the company business.
The same scenario applies to private companies and businesses. Indeed the situation can be even more critical for a private company as the owner of the company is often also the chief executive or managing director who absolutely needs a succession plan which can assist with their exit strategy.
Do you have a succession plan in place for your company / business? If not, why not? Perhaps your lack of planning and strategy is because of the difficulty of envisaging and or evaluating your potential successor.
When evaluating your potential successors, first look at yourself. Following are three classic mistakes leaders make when reviewing potential successors.
All three can cloud your objectivity and diminish your ability to evaluate successors.
Why doesn’t she act like me?
As a rule successful human beings tend to “over-weight” their own strengths and “under-weight” their weaknesses when evaluating others. The more successful they become, the more they can fall into the “superstition trap”, which is, “I behave this way. I am a successful leader. Therefore, I must be a successful leader because I behave this way”.
After making a list of your strengths and challenges, list the strengths and challenges of your potential successor. As hard as it may be, try to think like an objective outsider. Challenge yourself to recognise that the behaviour that you feel is most important for the company may really be the behaviour that is most important for you.
Why doesn’t he think like me?
It is hard for successful leaders to believe that their strategic thinking might not be the right strategic thinking. As you proceed in the succession process, you are going to have to let go. It can be very hard to watch your successor make decisions that are different to yours. It is especially tough since, as long as you are still the leader, you have the power to reverse the decisions.
Your successor is going to manage your organisation in the future – not you. As hard as it may be, you have to let him or her begin to make a bigger and bigger difference in developing strategy.
As long as the organisation will be headed in a positive general direction – and achieving results – recognise that your successor’s different path may actually turn out to be a better path.
Why doesn’t she respect and appreciate my friends and or associates?
We all tend to over-value input from people that we personally like and respect and under-value people that we don’t like as much. Face the fact that your successor may have different personal preferences than you. Your trusted advisor or mentor may not be hers.
Respect your successor enough to let her choose her own key advisers or mentor.
Succession planning remains a tricky issue mainly because the success of the planning is known only after a while. It will take some effort to be objective in the succession planning strategy. However, if you persist and ensure that succession planning is in place in all levels of your business, you have a good chance of producing strong, consistent leaders who will promote growth and opportunity. Creating a pool of talent to be able to meet the needs of the business in the future will minimise the need to seek (and pay for) external talent. This is good for both your business and your people.
