I recently noticed that the New York Times quoted me on the selection of a Chief Executive Officer. It included some great tips.
And the Next C.E.O. Will Be …
You aren’t going to be in charge of the company forever. Who is going to be your successor?
If you don’t know, aren’t sure or haven’t thought about it, the following advice could help.
AVOID MISTAKES There are three common pitfalls you want to guard against, as you go about choosing your successor, says Francie Dalton, president of Dalton Alliances Inc., a management consulting firm.
She refers to these as “the three Cs.”
The first is capitulation, or completely avoiding the decision of who is going to replace you.
The second is clone — trying to find a twin you, or someone as good as you perceive yourself to be. If you go that route, she says, “no one will ever meet your standards.”
Finally, you don’t want to pick someone primarily on the basis of chemistry — that is, the candidate’s No. 1 qualification is that you like him or her.
STARTING FROM SCRATCH Not certain where to begin in thinking about a successor? Carole Matthews, writing on Inc.com, interviewed Leslie Dashew, president of the Human Side of Enterprise, on the issue. Ms. Dashew provided three good questions to stimulate your thinking:
¶Where is the business heading, and what skills will be needed to take it there?
¶Will family members, employees and investors have confidence in the person you are thinking of picking?
¶Can the potential successor work well with the management team and you?
GET HELP Picking your successor can be an emotional and potentially overwhelming decision, of course. After asking those opening questions, if you are still not sure who your successor should be, experts suggest turning the problem over to your board or an outside search firm. Having them evaluate candidates can add objectivity.
WHAT TO DO Having settled on your successor, Heath Finn writing on Score.org, suggests you take the following three steps:
1. “Develop a formal training plan for your successor. Immerse your successor in the business of your company so he or she sees both the depth and breadth of the operation. This may sound simple enough, but there is a certain amount of ‘letting go’ that goes along with teaching your successor by allowing him or her to learn, grow and make mistakes before assuming the helm.”
2. Determine when the change in command will happen. Employees need to be clear who is going to be in charge when. “Once that’s accomplished, you need to be prepared to let your successor carry out the role for which he or she has been trained. Ultimately, your successor’s success or failure is up to him or her.”
3. Prepare to retire. “As your successor takes on more and more responsibilities, spend time planning how you will continue to be energized and involved in other activities away from the business.”
LAST CALL And then there is the advice you want to leave for the person who comes after you. The following, from Notboring.com, may not be the way to go:
On his final day, the outgoing chief executive hands his successor three numbered envelopes. “Should you encounter a problem you feel you’re not capable of solving,” says the old executive, “open these.”
Six months later, sales start to fall, and the new chief executive doesn’t know what to do. Then, he remembers the envelopes and opens the first one, which contains the message, “Blame your predecessor.” The new executive does, and the media, his bankers and Wall Street are placated. Sales began to pick up and the problem is soon behind him.
About a year later, the company again experiences problems. Having learned from his previous experience, the executive quickly opened the second envelope. The message: “Reorganize.” Again, the advice pays off.
But after several consecutive profitable quarters, the executive needs help again, so he opens the last envelope.
The message: “Prepare three envelopes.”
In my next post, I will share new ideas about transition planning that may be helpful to you.
