The day you will retire from your final CEO position may seem like a routine event, but a new study by the University of Arkansas observed that shareholders actually perceive seemingly normal succession in the corner office as a significant disruption to the viability of an organization.
Like United Continental, which needed to replace Oscar Munoz after his heart attack, and Mattel, whose former CEO Bryan Stockton resigned without warning in January, companies can find themselves needing an interim CEO at any moment.
The CEO is frequently fortunate to have earned a number of potential perks and to have achieved a level of wealth which can create an even more complicated decision-making process.
Having a clear succession plan for top leadership is vital for keeping any large or mid-sized organization running smoothly without interruption.
How difficult is it for a company to remain on the Fortune 500 list? Jim Collins, of Built to Last fame, wrote in 2008 that since the list’s inception, nearly 2,000 companies have appeared on it—and only 71 companies from the original 1955 list were still running strong. The Kauffman Foundation, in a recent report, noted that after seeing relatively low turnover in the 1960s and 70s, Fortune 500 turnover accelerated to new highs in the 80s and 90s. And Peter Senge of MIT’s Sloan School of Management writes that the average lifespan of a Fortune 500 company is only about 30 years. With such an uneven record, any successful CEO preparing to depart from his or her company should rightly be concerned about the legacy he or she is leaving behind—but that legacy is about far more than the CEO.
eBay’s John Donahoe Eight years into her tenure as eBay CEO, Meg Whitman called her former Bain & Co. colleague, John Donahoe, to interest him...
The retention of CEOs is enhanced when they begin their tenure on a strong footing. While executive integration is not a new topic, a recent study by RHR International shows that the process unfolds in a very specific fashion.
Although CEO succession planning is an integral part to any business plan, companies often fail to plan for it in a real and meaningful way. Doesn’t it seem counterintuitive to focus on leaving a company when you are busy enough with current management challenges? Failing to plan for the future can have negative effects on company reputation, employee morale, momentum and even stock price. Do you have a plan in place?
In recent years I have had a number of engagements with new and existing CEOs. They wanted me to help them arrive at a...