Each year, over 100 CEOs retire from the S&P 1000. But even in the most well-run companies, one challenge remains common among retiring executives: preparing the company, its employees, and its customers for new leadership.
All good things take time and planning for your retirement is no exception. For the CEO of any company, the process of divestment and delegation should ideally begin four to six years before the anticipated date of retirement. Not only does this give everyone concerned ample time to adjust to changes, but it also gives you the opportunity to assess and reconsider whether you have made the right choice of successor(s).
The Right Team
An individual, however capable, has a limited set of skills. Does the person you have groomed, or want to groom, to take over possess the cross-section of talents necessary to fill your shoes? If they do not currently, have they demonstrated an ability to pick up necessary skills in the past?
While most CEOs who find that no single person has the prerequisite mix of talents train the next best candidate, others chose to split the role in two and divide responsibilities accordingly.
The popular approach is to pick someone from within the organization as this minimizes transition pains. However, there is no obligation to do so; if you believe the ideal candidate must be recruited from the outside, approach them with your proposal and get the ball rolling.
Soft Transition
A period of overlap characterized by a gradual takeover of individual roles and responsibilities is the perfect model of succession. One-on-one training where the designated successor accompanies the CEO and learns the intricacies of the role on the job is very effective. The knowledge exchange that takes place in real life has no substitute in volumes of standard operating procedures.
Another irreplaceable aspect of the soft transition is that it gives people in the organization face time with the future leader. It also gives the latter an intimate understanding of the day-to-day processes and procedures that keep the wheels of the company turning.
A Good Start
It’s important that the corporate directors of the organization help the new CEO get off to a good start. While the first 100 days are the most critical, successful integration into the role can take between 12 and 18 months, especially if the position is being filled by someone coming in from the outside, who may not have had the opportunity to work one-on-one with the retiring executive leading up to their departure.
The discomfort with which clients and colleagues approach the prospect of your retirement is a testament to the confidence that they have developed in your leadership. By grooming the right successor and by ensuring a seamless transition, you will cement your legacy as one of unwavering commitment to the organization until the very end. Please contact me today if you have any questions about succession planning for your company or organization.
