New CEOs spark succession planning questions
We’ve had three different companies announce changes at the top, with new CEOs taking the reins at American Systems Corp., Booz Allen Hamilton and DynCorp.
The changes at American Systems and DynCorp will take place over the next few weeks while the new CEO at Booz Allen will take over Jan. 1.
The way each company has handled their leadership transitions are good examples of succession planning. The exit of one leader, for whatever reason, and the entrance of new leadership is simultaneous.
With American Systems and Booz Allen, an insider has been groomed to take over. These new CEOs have risen through the ranks of the companies, taking on ever increasing roles and responsibilities.
DynCorp is bringing in an outsider, and likely were in a search for some period of time.
But it doesn’t really matter; each company is sending a clear signal to employees, customers and partners that they are stable, in control and have a strategy.
Some companies take a different approach.
Leidos has a new CEO in Roger Krone, who took over on Monday. Former CEO John Jumper continues as chairman of the board. But Jumper announced his intention to retire as CEO in February.
Before tapping Krone, a former Boeing executive, the company went through a four-month search process.
Harris Corp. followed a similar path in 2011. Chairman and CEO Howard Lance announced his intention to retire in May, and his successor, William Brown, was named in October--five months later.
Neither company was rudderless during the search process, but I do remember talking to a senior Harris executive at the time who said there was still a feeling of limbo and uncertainty.
After Lockheed Martin went through the scandal that sacked their CEO-in-waiting and elevated current chairman and CEO Marillyn Hewson, former Lockheed executive Linda Gooden walked me through the succession planning the company goes through.
In essence, every senior leader has two candidates in the wings that can serve as potential replacements. Those potential replacements are groomed, reviewed and vetted. Who they are may change as time goes by, but there are always two.
That explains how the company fired one executive and named a replacement in one fell swoop.
I’ve admired that approach ever since because there are no gaps. There are no questions. And again, the moves send a clear signal of stability.
And this week with American Systems, Booz Allen and DynCorp, we see three more examples of this kind of planning.
In today’s market, it’s critical to know who your leaders are, and that includes knowing who might be in the wings, ready to step up.
Posted by Nick Wakeman on Jul 15, 2014 at 8:03 AM