During the past several years, when some of my friends told me they were becoming grandparents, I told them I was very happy for them. However, since I have five children, it wasn’t clear to me why becoming a grandparent was such a big deal. Isn’t it really just another small person?
Well, after becoming a grandparent 22 months ago, I must now admit that it is a VERY, VERY big deal!!!😁
First of all, the idea of your children having children is a fairly amazing concept (at least it has been for me). And it is very interesting for my daughter to tell me what is and is not appropriate in dealing with my grandson. I now am getting used to
receiving a lot of comments along the lines of, “Dad, no, you cannot give him candy and ice cream. That is not good for him.” Or, “Dad, he cannot stay up that late, and no, he is too young to go to a Cubs game.” 🤣
In fact, come to think of it, all five of my children keep asking me why I am so much more lenient with Harrison than I was with them. I guess it’s because my friends have influenced me to believe I am no longer responsible for discipline, and I can focus on being the fun guy.
Another interesting question that comes up from my five children is: “Dad, why is it that you have more photos of Harrison in 22 months then all five of us combined in the past 37 years? I realize I could try to explain to them that with smart phones it’s so much easier now to take photos than back when they were little, but I like to tease them by saying that I have more photos of Harrison because I like him more than you guys🤣 (Of course, I then need to immediately explain that I’m only kidding.)
OK, I am sure you would expect me to share a few photos:
On a more serious topic: My latest Forbes article addresses the reasons why many boards have a problem with one of their key responsibilities — succession planning of the CEO. The article below includes three reasons CEO succession planning gets sidelined:
- The CEO lacks true self-confidence.
- The CEO believes they are irreplaceable.
- The board is asleep at the switch.
Here is a link to the article, and the full article is included below.
Succession Is The Top Responsibility Of A Board—Yet Many Avoid It
It was a pivotal moment in my career—I had just been named CEO of Baxter International, a $12 billion healthcare company. As I headed into my first meeting as CEO with the board of directors, I was well prepared to discuss financial performance, strategy, and a potential acquisition. That’s when the lead director pulled me aside and shared the top item on his agenda: succession planning.
It came as a bit of a shock. I was only 43 years old, so retirement wasn’t on my radar, and I had only been in the CEO position for two months. Succession planning seemed premature.
The lead director explained the rationale: “We unanimously approved you as the CEO, Harry. But we’re not going to sit around, waiting to be surprised if something should happen to you. We need to know that there are two or three people in the company who could succeed you, and we want to know about the development plans for those people.”
It’s the No. 1 responsibility of any board of directors: leadership succession. Even if the current CEO is doing a great job, the board needs to ensure that there is a plan in place should the unexpected happen—the euphemistic “getting hit by a bus” scenario.
Three Reasons CEO Succession Planning Gets Sidelined
1. The CEO Lacks True Self-Confidence.
As I observed in my previous article on board dysfunction and what to do about it, setting clear expectations supports good governance. One of the expectations is that the CEO will develop people in the organization so that there is a pipeline of leaders being developed for top roles. With that expectation understood by all parties, failure by the CEO to develop leadership candidates could have significant consequences, from the reduction in their bonus to even the loss of their job.
2. The CEO Believes They Are Irreplaceable.
This is the opposite scenario: a CEO who is self-confident to the point of bravado. With an attitude of “nobody could possibly replace me,” this type of CEO doesn’t see the point of succession planning other than a “check the box” exercise. This is a recipe for a failed succession.
A case in point: Disney CEO Bob Iger has been criticized for his handling of succession. First, Iger was supposed to leave Disney in 2011, but his term was extended several times—until he left the CEO role in February 2020 and was succeeded by Bob Chapek. But Iger, who assumed the role of executive chairman, and Chapek, who he had supposedly picked to succeed him, clashed. In late 2022, Chapek left Disney, and Iger was brought back in again as CEO. That term was supposed to end in 2024 but is now being extended to 2026.
Now, with Iger set to leave again, there are some indications that succession will be different this time. For one thing, the board appears to be more in charge of the succession process.
3. The Board Is Asleep At The Switch.
The company is doing well and there’s a good CEO in place. Why worry about succession right now? The reason is simple: the unexpected and even the unthinkable can happen. Being prepared for such an event is the mark of exemplary governance. Consider McDonald’s Corp., which has long been admired for its leadership development. This strength enabled the company to endure two unexpected CEO successions: when James Cantalupo died suddenly of a heart attack and, six months later, when his successor Charles Bell resigned due to terminal illness. Losing two CEOs in one year under such circumstances is unimaginable, and yet that is exactly what faced this Fortune 500 company. Fortunately, a strong candidate was prepared to step in: James Skinner, a long-time company employee who held the CEO role for nearly eight years.
Surviving what could have been a leadership crisis, and even thriving amid such upheaval, did not just happen. As a Korn Ferry case study on McDonald’s observed: “The succession pipeline that produced Skinner had begun to be reconfigured six years earlier. The catalyst for change was a mandate from the board … [with] a succession plan that would identify two successors for each key spot — ‘one ready now, one ready future.’ The future candidate was to be ready within two years.”
How Succession Candidate Visibility Has Changed
The good news for organizations today is greater visibility of CEO succession candidates in front of the board of directors. Over the past two decades, an increasing number of boards have become more vocal about wanting to interact with company executives being groomed as possible CEO succession candidates. For example, these executives might be invited to the dinner preceding the quarterly board meeting or to participate in some of the board meeting discussions.
This is a significant change from the past, when the CEO might ask one or two of these executives to make a brief presentation, no more than 30 minutes in length, at the quarterly board meeting. After that, these executives were neither seen nor heard from.
Today, greater visibility with the board is helping to facilitate overall leadership development at the company. For example, in addition to managing CEO succession, boards also want to know more about how executives within the company are being groomed to take over key roles such as chief financial officer, chief marketing officer, and chief human resources officer. With greater breadth and depth across leadership development and succession planning, the board can help ensure that the company has the right people in the leadership pipeline. And that is good news for all involved.
