HOW TO DEVELOP CEO SUCCESSION PLANNING
‘Coach Kriengsak, as you know, our CEO will reach retirement age in two years,” Dan tells me. “We need to have at least two internal candidates as potential successors now so that we have enough time to groom them. I’ve been appointed chairman of a subcommittee on CEO succession planning.”
“That’s a big responsibility, Dan. What are your plans?”
“In preparing our next CEO, here are the steps that I have in mind:
1. Identify the future business landscape.
2. Identify the key qualifications a CEO needs. 3. Identify potential CEO successors. 4. Identify gaps. 5. Identify development plans. 6. Implement the plan. 7. Measure the development.” “Sounds good to me. How can I help your thinking today?”
“Coach, you can be my sounding board on this subject. I also want you to challenge me if you see any gaps in my thoughts.”
I nod and ask him, “Dan, what do you think the future business landscape will look like in the next five years?”
“I’m not sure. It’s quite a blur at the moment. The broad scope for our business will be to maintain moderate growth in the domestic market and high growth in AEC countries.”
“What about the organisational development stage?”
“I think we will be in alignment mode. In the near future, we will be a regional company not a Thai company. Hence, the new CEO needs to ensure that our corporate values are well communicated in all the countries where we operate.” “What about the stakeholders?” “That’s a very good point. In the future, we will have more stakeholders in terms of board composition and in various markets in the region. Hence, the new CEO needs to be very good at managing various stakeholders’ expectations.”
“Dan, let’s pause here and summarise the critical qualifications of the future CEO.”
“Coach, apart from strong management and leadership skills, the new CEO will need to have: ability to lead amid ambiguity; ability to realign diverse cultures into one;
ability to manage diverse stakeholders’ expectations.”
“How many internal candidates fit the bill?” “None.” “Why?” “We have Khun Suree, who is good at the first two qualifications but not good at managing diverse stakeholders. On the other hand, Khun Dej meets the last two qualifications but is not good at dealing with ambiguity. Nevertheless, we will have two years to develop both of them to fill those gaps.”
“What will be the development plan for each person?”
“For Khun Suree, I will assign her one year as deputy CEO of the new joint venture in Myanmar. We have a very strong and capable CEO there. Then, the following year, I will assign her to lead a subsidiary in Australia. These two years of experience will help her to be a better leader when dealing with diverse stakeholders.
“For Khun Dej, I’m not sure how to help him deal better with ambiguity. Do you have any ideas?”
“Dan, I once had a coaching client who wanted to develop her ability to deal with the ambiguity. One of my recommendations to her was to read the report “Eighty-eight Assignments for Development in Place” by Michael Lombardo and Robert Eichinger from the Center for Creative Leadership. Their study suggested that when it comes to difficulty in dealing with ambiguity, people could benefit from involvement in startup projects, “fix-it” assignments or strategy development projects. It suggested assignments such as:
1. Run a task force on a pressing business problem. 2. Install a new system. 3. Integrate systems across units. 4. Launch new product or programme. 5. Manage an ad hoc group in which you are the expert but the members are not.
6. Manage an ad hoc group in which the members are experts but you are not. 7. Deal with a business crisis. 8. Assign an undoable project (the last person who tried it failed).”
“That’s good information. I think I will assign Khun Dej to work on managing a group where the members are experts and he knows nothing about the technical side of that business. Further, this is a project that we are considering divesting.”
“Great. Dan, I think we’ve covered a lot of ground in terms of the development plan. Now let’s focus on the implementation. What could go wrong?”
“Coach, each person will have different issues. Khun Suree might not want to go overseas since she has a strong bond with her family in Bangkok. Khun Dej might misunderstand if I assign him to lead project involving a business we plan to divest — he might think it’s a punishment and not development.”
“How will you prevent those potential problems?”
“I need to sit down with each individual. I will need to spend time explaining to them and asking about their concerns. If they want to have time to think about it, I’m happy to wait for them as well.”
“All right, let’s follow up in our next session.”
Kriengsak Niratpattanasai provides executive coaching in leadership and diversity management under the brand TheCoach. He can be reached at coachkriengsak@yahoo.com. Daily inspirational quotations can be found on his Facebook fan page: https://www.facebook.com/TheCoachinth. Previous articles are archived at http://thecoach.in.th