Last Acts of Responsibility: Planning Leadership Transitions

Marigold-sellerPriya Viswanath is an independent consultant and author based in New Delhi, India. She shares with us her transition from CEO of CAF India and the importance of an organization’s need for strategic planning in the post below. This article was originally posted on Centre for Advancement of Philanthropy (CAP). Priya can be reached at priyakviswanath@gmail.com.

Since May 2009 when I left CAF India, Noshir Dadrawala has been requesting me to write on two issues – leadership transitions and the second on the importance of strategic planning for non-profits. It was too close for comfort for awhile so I promised him I would think about it and cover it soon. 

A series of events in the last few months – incidences of affront, forgetfulness and disdain meted out to fellow professionals and more recently an appeal from a colleague to focus on leadership as a part of a series of Capacity Building Training finally has me writing this. As it always happens before I start work on a column (quite by accident), I also came across a series of articles that focus on these subjects. In April, I read “The Last Act of a Great CEO” by Thomas J. Friel and Robert S. Duboff which was a complete eye opener. Earlier this week, I read the recent issue of Forbes India which had a cover story on ITC and their dynamic, visionary CEO Yogi Deveshwar, transitions, impact et all. And this morning while searching for a piece of inspiration, I listened to Steve Jobs commencement lecture for the 100th time. While all articles focused on for-profit CEOs they were all educative and almost all of it had inspired wisdom. Often I hear people say or have remarked myself that the non-profit sector does not have the luxury of grooming successors (for economic reasons) like a TCS or an ITC, but where the sector lacks in money, they more than make up with passion and commitment. The question, as I have often seen is less about the money and more about the will of organisations to streamline much needed processes in areas such as organisational management.

My own transition plan was guided by a business mentor and endorsed by the Chairman of CAF India. As I was approaching the last year of my second term in office, I reflected deeply about the organization, its new Strategic Plan that had just been put in place a few months earlier, the vision and energy that the organisation needed to execute an ambitious much needed plan. The Trustees of CAF India and management of CAF UK – (the parent) were on board, staff were excited, we had some great companies and NGOs partnering us in the last couple of years and CAF India was definitely on an upward trajectory. But I was physically tired, had just turned 40 and the transactional nature of the business, day-to-day operations were frankly boring me. 

I started thinking about what I wanted to do for the next 10 years of my life and clearly this wasn’t it. Having even thought that unmentionable thought, I panicked, went off on holiday to Indo-Chine with a friend and had what my colleagues tease me about – “a Laos moment”! I decided when I returned I would give CAF a year’s notice (effectively not renewing my contract). I came home and announced it to some key folk who had helped us develop the strategy and they gave me valuable advice on the process I should adopt. To cut a long story short, it was a year of great planning, searching and eventually great joy and sadness having effected a good transition to plan, but having to leave a great team and an organization where one had spent 6 years. CAF UK was very pleased with the transition – in fact a senior colleague wrote and said the process should be benchmarked for other international offices. Others including colleagues were shocked at the year long notice. But I felt it was only appropriate and the right thing to do for the organisation’s well-being. When word got out, I had many interesting, lucrative offers but I stuck it out, did not jump the ship and can live with my conscience today.

 Organizations for many leaders are like babies. You nurture them, you help them take big steps and small and like a parent would, you have to do what is right by them. That includes planning an effective transition. I have often wondered, like many of you probably have, about some great institutions and their charismatic leaders and what will happen after the founder’s life time.

 In the last few months – across the great ocean and closer to home two of my colleagues put in their papers. One leader had given the organisation over 14 years of his life; the other a much shorter stint, but led through a very intense period. The remit and scope of work of both organisations were vastly different and the leaders were outstanding professionals. While I left CAF India with vast goodwill from the management, here were colleagues who had served selflessly, put these organisations on the map and yet leaving with a great sense of anger, sadness and disappointment. Short-sighted, meaningless remarks expressed by boards and in-coming CEOs that were pathetic and unprofessional. I could not thank my own Board and colleagues enough for the respect and grace they had afforded me till the very end. 

Two things here – we don’t really value our greatest assets – our people and for one if not both of them huge amounts of work needed to be done with the Boards. I heard from my colleague across the ocean last night that his Chairman did not attend his farewell. What a contrast from my Chair who hosted a dinner in his own home for Trustees past and present to say goodbye to me and welcome Amita. 

When I read “Last Act of a Great CEO” – (incidentally a must read for every leader irrespective of the nature of their business), it was a revelation. I felt no matter how well I had done, I could have done it better. Friel and Duboff quote a veteran Chief Executive who told them “The former CEO can tell you which are the load-bearing walls” in the book. When I think of my colleagues – this comment on load-bearing walls is actually to my mind – very pertinent. When there are personality clashes between parties – board and CEO or incoming or outgoing CEOs – this avenue to learn more, access to vital information is lost. Friel and Duboff also share valuable insights of best practices in the corporate sector that are worth having a good think about: 

Sometimes transitions are marked by thorough debriefings between the once and future leaders. We looked closely at a company where succession is taken very seriously: the computer chip maker Intel. In the past two decades or so, that organization has had four CEOs and three orderly successions: The baton passed from Gordon Moore to Andy Grove to Craig Barrett to Paul Otellini. In what has become a core process, each transition date was announced well in advance and each outgoing CEO served for a time as chairman. Craig Barrett described that time as including regular mentoring of his successor. When we asked how the process got started, he told us, “I learned this from Andy Grove. It was natural that I would do the same with Paul. I have no doubt that he will do the same with his successor.” 

Barrett’s comment reveals two things: First, it has become a cultural norm at Intel that the old and new CEOs will confer meaningfully. Second, the departing CEO is responsible for making it happen. Both points are problematic for most other companies. The issue is usually not the willingness of outgoing executives, who tend to be eager to share their thoughts—out of a sense of duty and because they have a financial stake (through stock or options) in the continued success of the company.

My colleague Arundhati Ghosh from the India Foundation of the Arts in Bangalore reflected on the larger issue of organizational management and succession planning while impressing upon to do some critical capacity building in this area.  

HR is very crucial and very few non-profits spend time on this. It’s strange how though human beings are our key resource we often don’t treat them well, have no policies and expect them to work for love and fresh air. As if having committed to work for the not-for-profit sector has sealed their fate to not wanting more than the job satisfaction they presumably get. Organizations don’t think enough about job profiles, roles, mentoring, career planning, etc. I think a leaders’ training programme for this, is very important. One of the reasons they don’t have good second rung leaders who will take over from the first leader is that most people don’t stay long enough! 

This may be an effective long term solution to think about while planning for long term organisational sustainability. 

Planning effective leadership transitions are critical for any organisation. No matter how successful a leader is, a bigger disservice he cannot do to his organisation if h/she does not effect a thoughtful leadership transition. Too few think it is not part of their job or responsibility, but it is. If your organisation has the financial wherewithal, then hiring and grooming a senior second line person who can be considered for the job is good i.e. if there is no one competent in the current team. Doing this a year or two prior to your planned departure is appropriate. Necessary internal communication is important part of that process. If this is not possible then plan a well-managed transition. This will include serving a reasonable notice period, developing a level of board engagement, mentorship, and effective on-boarding.

How many CEOs incoming or outgoing would have the maturity and feel secure enough to adopt an Intel kind of solution is questionable (and rare), but it is important to view the outgoing staff as your biggest brand ambassadors. It would be both foolhardy and self defeating to lose an organisation’s critical intellectual property and goodwill with the outgoing CEO. Certain circumstances, forces and histories sometimes prevent that, but that is more the exception than the norm.

Friel and Duboff have many valuable tips for those planning for a transition. But two points they make I think are important …

Keep the grain of salt at hand. When a new CEO sits down with her predecessor, she should respect the fact that the person sitting across from her is the only one in the world who has shared so many of her concerns. She should assume that he has thought about those issues deeply. This does not imply that the two of them must reach agreement. She should evaluate the opinions and perspectives of the exiting CEO based on her knowledge of him. In comments that she is inclined to dismiss, she should look for the grain of truth. In insights that she rushes to embrace, she should look for the grain of salt.

Throw the switch decisively. Regardless of how useful the departing CEO may be, it is essential that he or she rapidly yield the stage both internally and externally. The successor must become the company’s public persona. According to Craig Barrett, the former Intel CEO, “The day Paul [Otellini] was appointed, I took a sabbatical. I wanted to be away for a while so people wouldn’t come to me and would need to go to Paul immediately. When I came back, Paul and I worked out a list of things for me to do, and we began to meet regularly.” Several of the incoming CEOs we interviewed had had, and appreciated, similar experiences. Candid discussions in private won’t keep a new CEO from holding the limelight.

… Leaders and organizations know it is imperative that the new executive get off to a strong start—and that process begins with the transfer of CEO-level knowledge.

We often talk about effective governance in the non-profit sector. The biggest role the Board ever plays in addition to ensuring sound financial practice and sustainability is during the time of leadership transitions. Same is probably true of the for-profit sector as well. Factoring in for time from Board members for mentoring the new leader, taking an interest in organizational matters – (struggles and successes included) will ensure the new leader is well supported. It will also help in confidence building with stakeholders – funders, clients, and partners.

Organizations will far outlive leaders – this is a fact. But goodwill outlives both. No one wants to burn bridges, except perhaps in situations where there has been an untoward incident or when the ego of the organisation or management is hurt. Even if this maybe the case and there are serious differences of opinion between leaders, a lasting act of responsibility is not to harm the organisational brand and culture! And remember before you start planning to read the Last Act of a Great CEO and how to ACE your last 100 days!

Photo courtesy of Kevin Kelly, Asia Grace

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