Where Is Your Next CEO? Interesting Results from Our Recent Executive Search Experience
We have helped six bank boards through CEO transitions over the last two years, and three of the new CEOs came from inside the organization. In these cases, as you might imagine, there were succession plans in process long before the departing CEO reached retirement age. “Rising Stars” were identified and exposed to matters that might have been outside their normal roles, but that process helped to develop the next generation.
Each of these Boards felt that it was their fiduciary responsibility to look outside as well as inside to find the best successor available. Makes sense, but we all know that outsiders have “halos” on when the come for the interview, while inside candidates’ weaknesses are usually clearly known. The search must, therefore, be structured to balance the playing field if there are serious inside candidates. This is particularly tricky since many outside candidates are happily employed and only got involved because we sold them on the idea of an opportunity. The last thing you want to do is alert their current employers until you know that they are the chosen candidate.
This is just one of the very sensitive issues that must be resolved in a succession plan. Others include:
- the amount of overlap between the two CEOs,
- the structure of the Management Team’s compensation to facilitate transition,
- a plan for managing communications during either a sudden transition or an orderly retirement succession, and
- success planning for the first year of the new CEO’s tenure.
Every situation is different, but the list of topical issues is the same. Board’s of smaller companies tend to put off this difficult and sensitive work. No one wants to appear to be pushing the current CEO out, but developing inside talent takes a long time especially in a smaller company. We have found that engaging a Board with a review of the list of issues they need to consider helps get them focused and motivated to start the planning process. Our Firm has become deeply experienced in C-Level Succession Planning and Execution, and we are happy to educate your Board in these matters. For a complimentary presentation of the key issues they need to consider, please reply here, call Tim O’Rourke at 919-644-6962 ext. 1109 or complete the request form on our website when you click here.
Trackback from your site.