Sunday, October 8th, 2017
CEO, HOW LONG WILL YOU BE IN YOUR JOB?
The CEO median tenure is about 6-7 years. There are, of course the quickly discovered wrong choices for the top job that last about a year or the short tenure of a CEO brought in to handle a very specific situation or as a placeholder keeping things steady while the long term CEO is found.
Most companies don’t have a formal succession plan and those who do don’t especially like them or find them helpful. Vying for the top job creates an odd dynamic and almost always gets weird. There are usually two to three possible candidates. They know it. The CEO watches and creates challenges and watches and talks with her closest colleague about it incessantly once she gives the acknowledgement of moving on.
All kinds of things go cuckoo under the surace of the company while it sort of kind of keeps functioning:
CEO’s becomes reluctant to set a firm date, but people sniff that the transition is in the air. There is an odd uneasiness that pervades the company.
Very slowly the associates of the company begin to align with one or the other of the candidates. It’s clear to see. It’s part of the uneasiness. Have I chosen the winner?
The company becomes paralyzed at the top while projects and initiatives become stalled waiting for commitment.
There is gossip galore and absolutely every movement at the top is viewed as symbolic of approval of a candidate. Who rides in what car? Who went to dinner with so and so? Sudden white noise surrounds the Executive Committee.
Major top level meetings are cancelled or avoided as a way to avoid questions or to buy time for making a choice and announcement.
When there is a CEO solidly in place whether magnificent or not there is a tendency to think she is not needed. But when the CEO vacuum begins to grow as his or herpower begins to wane, the need for that CEO role to be filled becomes evident. The rock, the rudder, the idiot we can blame for everything, the single point of direction, our leader is important. We want one. We have to have one flawed or not.
I like a seven year tenure. Come in, establish trust, set new direction and get it on its feet (three to five years–yep, yep, yep. It takes that long if create and root the new) Then time to assess again, not the CEO as much as what is needed by the company. If there is still a fit with the CEO, then there could be a new wave of development of the business. If not, choosing the next CEO can take 2-3 years.
In reality, too many CEO changes are jarring and a surprise to the CEO when it comes. An outsider is brought in that causes a top talent departure.Time is lost as the company adjusts to upheaval. Unrest continues. The eye and energy of the company is distracted from customers. I admire all the people of the company who muddle on anyway.
I have seen good CEO succession as well. There is always hurt and disappointment and adjustment as the new CEO is named and gets ready for the top role. But a graceful change without sudden changes in company focus is a gift to the people in the company and for the health of the business. Succession planning is not an academic exercise. It is a messy personal hugely impactful change organizational change. We could do a better job of it, I think.