Is Your Succession Planning Process “All Ornaments and No Tree?”

I work with a CHRO who once described her company’s succession planning process as “all ornaments and no tree.” On the surface, her feedback might seem somewhat surprising. After all, the company conducted biannual talent management roundtables during which its top 200 or so leaders (and their viability as possible successors for enterprise-critical roles) were discussed in detail.

A Breakthrough Alternative to Sourcing Talent

For more than sixty years, the primary resource for companies seeking outside executive talent to fill key roles has been search firms. The search firm business model has been remarkably resistant to change, with both retained and contingency searches costing as much as a third of first year compensation for the hired executive. While these firms offer a valuable service to their clients, there are some significant drawbacks to traditional search beyond the extraordinary fees.

A Different Look at Managing CEO Performance

According to best practices in board evaluations, you should hire an external expert to conduct the process at least every two to three years. This helps uncover subtle issues and opportunities, increase candor, and reduce the risk of a check-the-box approach by introducing different questions, process, and perspective. We are starting to see a similar trend in managing CEO performance.

CEO Selection: Insiders Versus Outsiders

I’ve been involved in several situations lately where a sudden CEO departure has left a gaping hole. At times, it is due to a performance or results issue. But there are also a number of times where unanticipated health or life circumstances and issues have caused abrupt changes. There is no name taped to the bottom of a drawer that suggests who the outgoing CEO thinks is ready, and the board has not fully addressed the issue of succession planning. The obvious solution is for the board and leadership to always have an ongoing dialogue about who is being developed for the top job.

The Importance of Onboarding in Creating a Learning Environment

The world of work is changing rapidly, and organizations can’t expect to rely on outdated ways to build capabilities to keep up. In particular, formal learning, training, and development approaches have failed to help shift skills and behavior to create new ways of working. As a result, organizations turn to hiring leaders from the outside to build new capabilities. While bringing in new leaders can have an impact on an organization, there is still a need to intentionally shift how work gets done by having employees learn on the job.

How to Develop Your CEO Succession Candidates

In 2017, 919 CEOs either resigned, retired, or got fired at publicly traded North American companies. This was the highest number in at least a decade. As more baby boomers hit retirement age and the pressures of leading an organization continue to mount, several thousand more CEOs are expected to vacate their positions in the next few years. To prepare for these leadership transitions, boards and CEOs need to be preparing the next generation of chief executives now

Behind Unusual Ouster of Company’s Top Three Leaders: A Troubled $14.5 Billion Merger

RHR's Paul Winum is quoted in The Wall Street Journal on the topic of Dentsply Sirona's ousting of CEO Jeffrey Slovin, Executive Chairman Bret Wise and President Christopher Clark, who also was chief operating officer.

“To have the three top leaders get taken out is extremely disruptive,’’ said Paul Winum, co-head of board and CEO services at RHR International LLP, a leadership-development firm. Mr. Thierer must “take actions immediately to correct the [company’s] course.’’

 

CEO Succession: The Hidden Costs of Shortcuts

Shortcuts can be so appealing. They promise an earlier arrival, reduced effort, or less expenditure for a similar outcome. We have all taken them at one point or another. And sometimes they seem to live up to their appeal. The problem is that it is difficult to foresee the risks of these forays until they suddenly emerge. Such is the case with CEO succession planning.

Dodging Bullets: Flagging Management Deal Breakers Early in the Ownership Process

The unplanned replacement of a portfolio company CEO can have disastrous consequences. Most private equity firms have painfully experienced it at some point in the life of a fund. The full extent of poor senior executive leadership often takes time to fully surface and longer to rectify. Finding a full-time replacement CEO, onboarding, and rebuilding organizational alignment all inject risk and potential for delay in exiting.

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