Transitions at the Top: What Organizations Must Do to Make Sure New Leaders Succeed

by Dan Ciampa and David L. Dotlich

Transitions at the Top aims to address the high failure rate and lackluster performance of newly-appointed CEOs of public corporations.

This summary comes with a caveat for nonprofits: the focus is on CEOs of public corporations. Public corporations have a different governance structure than nonprofits. First, their boards include inside (executive) directors and outside (independent) directors. Second, the current or former CEO often serves as board chair. Given the differences in governance structure and the role of the chief executive, some advice in those two areas must be taken with a grain of salt.

The advice in this book is based mainly on transitions involving designated internal successors – either an executive promoted into a designated successor role or an outsider hired into the role. It might be an existing role, such as COO, or a newly created role with similarly substantial responsibilities where the designated successor can be groomed. Thus, it assumes that there will be a significant overlap between the exiting and incoming CEOs before the handoff takes place.

This said, it provides a thorough outline of what the organization should do, and in particular, what the major players in the transition process–the departing CEO, the board of directors, the chief human resources officer (CHRO), and the senior managers–should do.

About the authors: Dan Ciampa is an advisor on CEO transitions, operations improvement, culture change, and implementing new strategies. Businessweek named him among the top five CEO advisors. He is the author of four other books, including Right from the Start, with Michael Watkins. David Dotlich, Ph.D., is president of Pivot Leadership, a Korn Ferry company, and is an advisor and coach to CEOs and boards. He is a former executive vice president of Honeywell International and the author of 12 books on leadership.

This summary reflects my takeaways from a useful book I recommend to others. Reading a summary isn’t a substitute for reading the book. There’s much more than I can cover here. Plus, this is my interpretation. If these ideas resonate with you, I encourage you to get a copy from your favorite bookseller. Here are the Amazon links: e-book | Print

Unless otherwise noted, all quotes should be attributed to the book’s author.

SUMMARY

Leadership transition means maintaining strategic, operational, and cultural continuity as one leader hands off authority to their successor.

The Transition Challenge:

About 25 percent of next-in-line executives hired from the outside succeed in the CEO job, and only about 50 percent of those promoted from within.

Most new CEOs who fall short or outright fail do so because of one or more of the same handful of reasons:

They fail to read the political situation and build relationships, coalitions, and alliances vital to their success.
They fail to understand the culture and how to influence it.
They misread people’s capacity or willingness to implement needed changes.
They don’t make the most of the time between accepting the position and their first day; thus, they get off to a slow or rocky start.

The solution is better managed transitions and more thorough support for the new CEO before, during, and after the handoff from their predecessor.

The four major players involved in the transition are the departing CEO, the board of directors, the chief human resources officer (CHRO), and the senior managers.

For well-managed and comprehensive transitions, the major players must:**

Steer clear of the pervasive myths about transitions that lead to thinking errors and errors in execution;
Develop a solid understanding of the transition process by becoming students of successful transitions;
Understand and prepare for their transition roles and the related imperatives; and
Communicate effectively and track progress to ensure that the transition is well-coordinated.

Failure is Rooted in Complexity

Turnover in the CEO role is a high-stakes crossroad for any organization, and transitions are complex processes with many interconnected moving parts that span many months. Further adding to the complexity is the influence of strong emotions these changes provoke.

Among the many factors that contribute to the complexity, there are two standouts :

Individual adjustments that the major players (the exiting CEO, the board, the CHRO, and senior managers) must make and how they interact and coordinate during the transition.
Systemic changes in the organization. Strategic, operational, political, and cultural adjustments, especially if a change in leadership also results in a change in strategy or a reorganization.

…what makes the difference between a successful and unsuccessful transition is the recognition of and management of its complexity.

Ignoring or not giving sufficient attention to this complexity opens the doors to thinking and execution errors.

Individual Adjustments

Each of the major players faces their own version of complexity.

The exiting CEO has the added accountability for helping integrate the new CEO on top of leading the organization day-to-day. Plus, they face the emotional reckoning they are leaving, considerations about their legacy, and contemplations about what’s next.
The board of directors is also accountable for the successful outcome of the transition in addition to routine governance. While much of the day-to-day will be shouldered by the staff and consultants, the board must have a plan and add oversight functions and mechanisms to ensure that the search for the successor and the transition come off without a hitch.
The CHRO wears multiple hats during the transition with roles including planner, communicator, interpreter, and sounding board with the other major players. The complexity arises from balancing paradoxical behaviors while fulfilling these roles. The CHRO must be organized yet flexible, assertive yet aware of limits, collaborate with the board while reporting to the CEO, and assist the new leader and CEO build a working relationship. The CHRO effectively acts as a bridge between various stakeholders.
The senior manager’s key role is to prepare the organization for a new key player or boss. This entails justifying or adjusting their existing plans and shaping a new working relationship, knowing that the new leader’s position can impact their unit’s operations and career aspirations.

Systemic Adjustments

A transition at the top involves not just individual adjustments but adjustments to the system as a whole.

Strategic. A new leader can bring change in strategic direction ranging from subtle to bold, particularly when given a mandate by the board to chart a new course.
Operational. When the strategy changes or the new leader reorganizes, the systems and processes must change.
Political. In organizations, alliances and coalitions determine decision-making, influence, and success. New leaders must gain stakeholder loyalty by forging those relationships.
Cultural. New leaders often struggle to comprehend the culture of a new organization due to the complexity of exploring multiple layers and interpreting data. It may take up to six months for them to fully comprehend the subtle nuances of behavior, politics, expectations, rituals, traditions, and beliefs.

These adjustments cascade: Transitions often lead to strategy changes. Changes in strategy lead to restructuring the systems that drive operations. Changing operations alters relationships and reshapes the culture as one leadership era ends, and a new one begins.

Transitions are complex, but knowledgeable executives and directors can overcome obstacles and turn challenges into opportunities by understanding the interplay between strategic, operational, political, and cultural systems.

Three Destructive Myths

Among the thinking patterns and attitudes that lead to mistakes are three pervasive myths at the root of failed transitions:

When the major players assume that “transitions aren’t that big a deal,” it minimizes the significance of transitions, especially top-level transitions with high stakes.
When the board assumes that “the job of succession is over when the one we want says ‘yes,’” they think that after securing their desired candidate, they can step back and let the CEO take over. This attitude ignores directors’ unique responsibilities in overseeing the transition and ensuring its success.
“We know what they can do.” The major players overestimate the capabilities of the new executive to do “a job they have never done under conditions they’ve never faced.”

Transition Myths Hinder Productive Thinking

These myths mask the complex realities of the transition and keep people from thinking deeply about how to manage them. They divert people from:

Empathizing with the new leader. They don’t recognize the new leader’s challenges and related thoughts and feelings.
Learning about transitions. They believe that transitions are easy and fail to take necessary precautions for success.
Raising questions that lead to increased understanding and improvements. They don’t ask enough questions or dig deep enough to figure out what else they should do.

When empathy, learning, and questioning are obstructed, the transition process won’t be managed as well as it could.

Transition Myths Leave Tough Questions Unanswered

Ultimately, the biggest problem with transition myths is that they hinder meaningful conversations about crucial transition matters. Believing these myths, people may refrain from asking and answering difficult questions about strategy, operations, politics, personal issues, and culture.

Myths like these lead smart people down unproductive paths, leading to errors in execution, which causes failure in new leaders. Clear thinking is vital to success.

Execution Errors

Some common execution errors include:

Failing to plan for and manage the transition: Ignoring the transition or failing to handle it formally and systematically.
Missing or ignoring problems in the relationship between the incumbent and successor: Neglecting to address issues or conflicts in the working relationship between the outgoing and incoming leaders.
Preparing for only one transition: Focusing solely on the incumbent handing over power to the successor while ignoring the derivative transitions among the senior managers or elsewhere.
Mismanaging the transition process: Miscalculating the information needed, inadequately preparing major players for their roles, or poorly handling onboarding the new leader.

Transition success requires careful planning, effective relationship management, consideration of all transitions involved, accurate information assessment, and proper onboarding in leadership transitions.

Transitions at the top fail because major players are unprepared for critical crossroads… often because they underestimate or ignore the complexity of the transition process.

The Major Players’ Roles

To ensure the success of the transition, the major players should become students of successful transitions, understand their roles, and prepare themselves and the organization well.

The Board’s Role

The board has overall accountability for the transition’s success, providing oversight and guidance without compromising the CEO’s role. They must find and maintain the right balance and a collaborative stance with the CEO. Both parties have roles to play, with the CEO taking the lead on the transition work. The board should:

Be active and stay informed.
Become students of transitions – what’s required for success and the sources of failure.
Know the organization well enough to ensure the process designed by management fits the needs, and the roles of major players are appropriate.

To find that balance, the board and executive should agree on some ground rules for working together during the transition process. These rules of engagement may be different from those for routine governance.

The board’s key imperatives:

Provide valuable and wise oversight.
Manage their relationship with the executives:

Provide a smooth exit for the exiting CEO
Allow the new leader to master the skills needed to meet the emerging challenges and political realities.

Keep an eye on culture and politics during the transition.
Actively engage while staying within their role.

The Exiting CEO’s Role

Direct the transition and ensure the successor integrates well and moves up to the CEO position. This is their final significant objective before their departure.

Direct the transition: ensure the roles and expectations are clear, good communications, progress is reviewed appropriately, and the transition is on everyone’s agenda. The process is well-organized and efficient.

Ensure the successor is integrated and moves up: maintain a positive, interactive relationship with the successor and assume the appropriate role in their development and integration into the organization – counselor, instructor, supporter. Ensure the successor is meaningfully engaged to fulfill their learning and relationship-building objectives – well-prepared to assume the role.

The exiting CEO’s key imperatives:

Manage the transition steps and pace.
Make sure the other major players do what they need to do.
Self-manage and be self-aware. Manage their emotions and be aware of their impact on others as the handoff proceeds.

The CHRO’s Role

Coordinate the transition and serve as an internal advisor.

Coordinate the transition: Make sure a comprehensive plan is in place for the entire process. Ensure that all the steps are seamlessly integrated and aligned with the goals and mandates of the board and CEO. Ensure that all the necessary actions are carried out appropriately and that the transition is coordinated with other related activities, like the executive search.

Serve as an internal advisor:

Provide advice and serve as a sounding board for the CEO and senior managers.
Ensure the appropriate communications are taking place.
Advise and support the incoming CEO. Ensure they get the support, resources, and experiences they need to integrate into the organization and assume the CEO role.

The CHRO’s key imperatives:

Possess the necessary skills and temperament to provide exceptional senior staffing support.
Ensure the new leader receives the support needed to seamlessly and effectively transition into their role.
Establish the necessary structures and formulate strategies to improve relationships critical to the success of the transition.

As the person in the middle, the CHRO must possess excellent judgment, wisdom, and political skills and avoid any perceptions of being political.

The Senior Managers’ Role

Ensure operational continuity, shape organizational opinions, and prepare the organization for the handoff.

Ensure operational continuity: Make sure that the day-to-day operations continue producing results.
Shape organizational opinion: Communicate with their divisions or functions regarding a new strategic direction and the reasons for the transition that brings the new leader aboard.
Prepare the organization for the handoff: Ensure that they and their departments or functions adjust to a new leadership style and, potentially, new operational and strategic priorities. Adapt plans, systems, and processes as strategic and operational requirements change.

The senior managers’ imperatives:

Shape organizational opinion so that the various parts of the reorganization line up to support the transition and its objectives.
Support their team members, help them understand the change agenda, and support the new leader.
Establish strong relationships with the new leader and each other to align the senior management team.

Prepare the Major Players for the Right Roles

Make sure each player’s roles, responsibilities, and expectations are adequately defined, areas of overlap are sufficiently clear to each player, and there’s ample opportunity for sharing information, asking questions, and discussing ambiguities.

A RASI Chart Can Help Clarify Responsibilities

No single method for clarifying roles, responsibilities, and expectations works in every situation. However, “responsibility charting” is a technique that can help. The result is a RASI chart outlining four possible roles for each player for each task:

R = Responsible. Is directly responsible for the decision or accomplishing the task.
A = Approve/Veto. Has approval or authority over the decision or task.
S = Support/Provide Resources. Will provide support or resources.
I = Informed/Consulted. Is informed or consulted about the decision or task.

RASI Chart Mockup

TASK/DECISION	TEAM MEMBER 1	TEAM MEMBER 2	TEAM MEMBER 3	TEAM MEMBER 4
Task/Decision 1	R	A	S	I
Task/Decision 2	I	R	A	S
Task/Decision 3	S	I	R	A
Task/Decision 4	A	S	I	R

Success Factors

Success Factor: Teamwork

Regarding leadership transitions, teamwork plays a crucial role in achieving success.

Teamwork adaptation: Unlike other types of teamwork, leadership transitions require a unique form of collaboration. The major players and the new leader must understand their roles while continuously coordinating and communicating with trust and transparency.
Specific roles with coordination: Each player in the transition has specific duties, but they must also operate collectively, adjusting and changing direction together to adapt to new conditions. This teamwork is akin to a basketball or hockey team, where individual roles are well-defined, but the team’s success depends on unity and responsiveness to ever-changing situations.
Fluidity and trust: Successful transition teamwork resembles sports teams where trust in each other’s competence and motives is crucial. It requires skilled individuals committed to not only their own success but also to the success of their teammates.

Effective teamwork in leadership transitions involves well-defined roles, continuous coordination, trust, and adapting as a unified unit to evolving circumstances.

Success Factor: Learn about Transitions

As students of transition, the major players and the new leader must engage in five essential tasks:

Understand the general principles: Gain a deep understanding of what effective leadership transitions entail, what makes them succeed, and why some fail.
Tailor the principles to the organization’s unique circumstances: Avoid applying general principles universally; adapt and tailor insights to the organization’s specific context.
Recognize the unique character of top-level transitions: Acknowledge that top-level transitions are distinct from those at other levels, impacting various aspects of the organization, including strategy, operations, politics, and culture.
Promote dialogue: Encourage open and honest dialogue among the major players, where they discuss their assumptions, goals, hopes, and fears regarding the transition.
Adopt a lessons-learned approach: After the transition, conduct a disciplined analysis to understand what worked and what didn’t, fostering a culture of continuous improvement.

The new leader should also adopt a learning mindset involving curiosity, persistence, and discipline. This includes asking questions, seeking insights from executives in other companies, reading relevant materials, and keeping a journal to identify areas for further exploration.

Success Factor: Recognize the Crossroads

The third key success factor is recognizing critical junctures in the transition process and being prepared to react effectively when they arise. There are four crucial crossroads in a leadership transition:

Matching the candidate profile: This crossroads occurs when matching the profile of the most promising candidate with the organization’s strategy, culture, and facilitating/hindering factors. Making the right choices at this stage is crucial for a successful transition.
Recognizing the gap: The CEO should identify gaps between how the organization currently behaves and how it should behave during the transition. Closing this gap presents a significant test for the CEO and leadership group, involving deciding whether to act differently temporarily, use the transition as a catalyst for permanent changes, or maintain the status quo.
Determining CEO’s departure: The board and CEO must agree on when and how the CEO will leave. Managing this transition well ensures a smooth departure for the CEO, enables the board to focus on the new leader, and allows the new leader to take hold without distractions. This step is necessary to avoid misunderstandings and hurt feelings.
Preparation before Day 1: The period between the new leader’s acceptance of the role and their first day in the organization is crucial. It’s a time for preparation rather than relaxation. The new leader and the organization’s major players often make the mistake of thinking the job begins on the first day. In reality, this pre-Day 1 phase is when the foundation for the relationship is built, and it requires readiness and active participation from the CEO, CHRO, relevant directors, and the new leader.

Leadership transitions are inherently challenging, and no definitive, one-size-fits-all solutions exist. Successful transitions require well-prepared boards, CEOs, CHROs, and senior managers with well-thought-through perspectives engaged in open communication and the spirit of teamwork.

Conclusion

In an ideal scenario for a top-level leadership transition, several key features would be present:

The board would be knowledgeable about the organization, supportive of the CEO, and dedicated to the organization’s long-term success. They would offer wise counsel and understand their unique role in the transition, some having gone through CEO transitions themselves.
The exiting CEO would be a skilled executive and a mature leader who has earned the organization’s trust. They would be well-versed in CEO transitions, have strong interpersonal and communication skills, and be culturally and politically astute. They would be ready and willing to help their successor with a relationship based on respect and trust.
The CHRO would be strategic, practical, and tough-minded, with a deep understanding of what’s necessary for organizational survival and growth. They would create a culture of achievement, advise the CEO and peers, and be a respected manager capable of handling complex systems and project management.
Senior managers would be knowledgeable about top-level handoffs, empathetic to the new leader, and eager to learn from and work with them. They would adapt to changing strategic conditions while maintaining operational stability and prepare their functions or departments to effectively support the CEO and new leader.
The incoming leader would be prepared to learn about the organization, envision the optimal structure and relationships, build coalitions, and understand the CEO’s perspective. They would have appropriate experience and realistic expectations about the transition’s requirements and their role.

Transitions often face disruptions from unpredictable real-world factors, including emotions. To overcome these challenges, leaders should understand the requirements for success and be prepared to adapt. Guidelines presented in this book are intended to be customized to specific situations.

Book details and where to buy it:

Get the book on Amazon: : e-book | Print (affiliate links*)
Amazon rating: 4.6
Goodreads rating: 3.7
Page count: 288
Publication date: April 21, 2015
Author website: http://www.danciampa.com/

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