A new year has seen the recent arrival of a number of new CEOs in some of the UK’s largest firms. CEO transition is often mangled. All About Brands’ Chairman, Allan Biggar, gives his top five tips on how to make a success of it.
There appears to be an unusually high number of CEO transitions underway in some of the UK’s biggest firms. Recently Bob Dudley took over at BP following a disastrous period in its august history. Equally, HSBC’s unusually messy and rancorous process to appoint a new Chairman left the bank being forced into appointing a new CEO. And with it plenty of issues for the Chairman, Board and Stuart Gulliver, himself to wrestle. Mark Bolland is a newcomer at Marks & Spencer as is David Nish at Standard Life while John Rishton has been confirmed as the new CEO for Rolls Royce.
1. Understand the context. Too many CEO transitions get off to a poor start, and this is particularly apt for HSBC. It normally handles senior succession with the utmost sleekness and so the curious chain of events will have left internal and external audiences alike questioning what was at play and does it portend further, murkier muddles. So, our first tip to Stuart Gulliver and other new arrivals is to take stock in the first three months and reflect on the context he has just entered. By contrast, Bob Dudley at BP has had time to prepare for this although the circumstances of his appointment don’t compare particularly favourably.
2. Prioritise! There will be a long to-do list once in office but they will be prioritised according to the interests of your predecessor or management team. Take time to decide which ones you want to prioritise or meetings you want to attend. Your interests and actions will be carefully observed and will begin to help set expectations about what matters to you. But be careful in what you chose to prioritise.
I know of a FTSE 100 CEO who, on starting his new job, quickly announced a clean desk policy. It wasn’t framed particularly as an environmentally-friendly initiative; it reflected his personal style of not liking clutter or paper on desks. It was a strange priority to communicate early on and, to many employees, it smacked of petty-mindedness which has subsequently shaped his reputation internally.
3. Invest time in your management team. Regardless of whether you are new to the organization or have been plucked to the top job from an existing management team, it provides a natural opportunity for a reshuffle. Use that opportunity to be wise in your appointments and resist the temptation of surrounding yourself with people with whom you feel comfortable. Diversity of team and its strengths should be viewed as an asset.
4. Build a relationship with the Board. Perhaps one of the hardest tasks in your job will be to ensure you’ve earnt the trust and confidence of the Board. McKinsey wisely advises CEOs ‘you will need them, particularly when the going gets tough’. Each board member will come with his or her own perspective and it’s important you begin to understand what they represent. So if one Board member has an interest in Corporate Social Responsibility or diversity, make sure you also appear to share that interest or passion.
5. Develop a transition strategy and communicate it. This will set the tone for your priorities and style and should also shape the external personal profile that you want to fashion. Avoid getting distracted by short term initiative-itis such as a 100 day plan or short term commitments such as staff meetings or emails if you don’t intend to continue with them in the longer term. They can falsely raise expectations. The only key factor here is to remain consistent going forward since this will serve as the jumping off point for their tenure as CEO.
Taking over as a new CEO is a tough and can be, as I discovered, a lonely job. So perhaps my most important piece of advice is to have a spouse, friend or mentor who you can vent to.
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