Leaders should prepare their exit from the start

It is a matter of weeks before we know the identity of the next president of the United States. Until the moment he or she is sworn in, a cadre of nearly 900 people at the White House will work their way towards a leadership transition. When president Barack Obama’s helicopter lifts off on January 20 to take him into retirement, 1600 Pennsylvania Avenue will be populated with hordes of neophytes, doubling down for the next four years in service to a brand new boss.

Obama, unlike most leaders, knew his departure date four years in advance, as did his staffers. Building a legacy around the cadence of political life is just another day at the office for politicians. The pulse of organisations, however, runs rather more arrhythmically. As chief executive tenure diminishes (currently averaging six years, 20 per cent less than a decade ago), senior executives have both limited time and certainty to create and deploy winning strategies, cultivate relationships and plan their eventual exit.

No fixed term

As an executive coach, I often ask a newly minted chief executive what his next job will be. The question is usually met with a blank stare implying: “Didn’t I just arrive?” However, the illusion of having reached a destination is fanciful in professional life. As Steve Jobs said in his brilliant Stanford commencement speech, “Death is the destination we all share. No one has ever escaped it”. And so it is in the executive office: at some point, sooner than one imagines, it is over.

Take Leo Apotheker. He was surely delighted, summarily released by Sap after serving less than two years as chief executive, to be given a another chance at the C-suite, leading Hewlett Packard. He probably did not count on being fired again 10 months later. Organisations can be whimsical. For many, the accession to a senior position represents the crowning moment and an inner sigh of relief – immortality beckons, “I made it,” they cry. If Narcissus is inside you, at this point he will surely emerge.

Paradoxically, this is the moment when the hard work begins. The temptation to snap right into action, get operational, manage budgets, start a change programme, cut some costs and fully arm yourself for battles ahead can be highly compelling, and focus on bench development may take a diminished role. But, as Jim Collins advised in his book Good to Great, it is the new chief executive’s role to ensure the “right people are on the bus”. It is these “right people”, who should be occupying your seat in a few years’ time. While visualising this may be unpalatable, the error of omission can be fatal to a career.

Start with an eye on the end

Authoritarian types often surround themselves with liars, flatterers and incompetents as a way of maintaining control, unconscious or otherwise. Affiliative types try to work passively with what they inherit. Afraid to upset the status quo and release prior favourites, underperformers or those misaligned with their plans, they tend to remain frozen and muddle on. Pacesetting types accelerate into the distance only to look over their shoulder mid-battle and see acres of empty space behind them, their demoralised troops languishing in the middle distance.

The optimal strategy is the coaching approach. Once a new strategic vision has been established, those who do not fall into line after some leadership coaching should be displaced. The rest should be actively developed as a balanced and talented cohort who will represent the future, well beyond the end of one’s tenure. Like a garden they need nurturing, given individual attention, tailored development and stretch assignments to foster learning.

Transitioning out

As if transitioning in is not difficult enough, transitioning out is freighted with emotion. The road from onboarding to departure will have had its potholes and bumps. Some executives, of course, will be prematurely forced out. When the process is disorderly, a psychological mess will ensue. Exit transitions need to be managed carefully.

People, since time immemorial, have idealised leaders. Many people go through a mourning process as the day approaches for a popular senior executive to depart. One executive recently told me that to circumvent mourning he omitted to tell anyone he was leaving. He just didn’t show up one day. The stink went intercontinental and he left behind a well of anger.

The opposite temptation is to undertake a prolonged lap of honour. A leader I worked with in Germany, one who admittedly had driven enormous growth, decided to do a world tour at the company’s expense to say goodbye to all his “disciples”. He was fully entitled to do so, but it made the job of the new chief executive immeasurably harder. By the time he arrived in his comfortable corner office, the organisation was in a full-blown depression.

The right way to transition is a combination of both the above – goodbye rituals have their place but there is a prerogative to stand shoulder-to-shoulder with your successor and talk about the company story beyond the current chapter.

Graham Ward is an adjunct professor of leadership at Insead and leadership development practice director at the Insead Global Leadership Centre.


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