(Plan for the Transition of Power)
One common failure of many small and even mid-sized companies is that of inadequate planning for top management succession. Too often a President mulls over an early retirement, gives it “deep” consideration, announces his retirement to the world, and moves to Florida, all in the span of two months. A change in leadership is of enormous importance to any organization (as well as such outside vested interest groups as bankers, creditors, customers, etc.) and deserves careful planning to minimize the problems associated with such a transition
It is important to note that the initial success or failure of a top management succession rests primarily with the outgoing president rather than with his successor. Doesn’t it make sense to do your last important duty as well as the other major milestones you’ve championed throughout your career? Your legacy as well as the future of the organization you’ve served will benefit from doing it right.
Some parameters for CEO’s to consider that should aid the succession process are:
Announce your Decision Early. Due to the major impact that your departing will have on the organization, it is well to announce your decision early to both affected internal personnel and on a “need to know” basis to certain “outside parties” (accountants, bankers, attorneys, etc.). Think enough of your organization to provide affected parties adequate time to prepare for the pending transition.
Announce your Successor Early. Make your selection early enough to provide ample time for your successor to acquaint himself (herself) with the new position and to give others in the organization the time necessary to prepare for the assumption of control. This is not to say you should rush the all important selection process, but merely emphasizing the need for providing ample lead time.
Aim for a Gradual Transition of Power. Don’t relinquish the whole operation at once. Why not have a gradual turnover so that your successor can develop early success feelings as he or she assumes some lesser duties so that the groundwork is laid for an increased level of mutual self-confidence between your successor and the remainder of the organization, as more difficult responsibilities are transferred. The key here is to avoid overwhelming your successor.
Build the Image of your Successor. During the power transition period, as your successor makes some initial mistakes (remember even you have made some), don’t publicly embarrass or ridicule him in front of other members of the organization but rather advise and counsel him in private. Don’t destroy the building power base of your successor or you will be inviting additional transition problem.
Remain Available for Counsel. After the power transition, it is well to be available for consultation with your successor. Note, however, the role is merely that of advisor to the new head man, it is note the previous boss-employee relationship.
Have an Overall Timetable. The previous steps should be an inherent part of an overall transition timetable. The duration and depth of this plan will be dictated by the specific needs of your organization.
Adherence to the aforementioned transition guidelines should facilitate the power transition process and reduce the trauma generally associated with such a changeover. A smooth transition does not just happen. It requires a well planned, cooperative, and coordinated effort on the part of many individuals both in and out of the organization.