CEO Succession With A Global Professional Services Firm
This professional services firm has a long-tenured, highly successful CEO.
The Board instigated a long-term succession planning process in anticipation of his eventual retirement. A key objective was to develop potential successors and ensure the appointment of the right internal contender.
Key considerations included:
- An uncertain timeline for the CEO’s retirement – it was likely to be within 4 years but contingency planning for a shorter timeframe was critical.
- The incumbent CEO had a strong personality and a significant legacy. This risked skewing the Board’s view of future CEO requirements and meant that he was considered a hard act to follow. Some of the original potential successors had opted out early on in the process.
- There was a strong culture and a fairly homogeneous senior leadership team.
- A key objective became to identify and build a broad, strong and diverse pool of potential successors.
- Given the above, it was critical to reduce potential risks and biases, align the Board, ensure talent had sufficient access to the Board and a fair, objective process.
The process was underpinned by regular support and advisory to the CEO and Chair to optimise the process, prepare for Board engagements and ensure alignment. There were four key phases to the project.
1. Identifying and developing a broad bench of talent:
- Accelerated development of an initial pool of 18 senior leaders (over 2 cohorts) including in-depth assessments, stakeholder feedback, coaching and measurement of change over time.
2. Targeted investment in the most likely contenders:
- A future-focused profile of success was developed and aligned the Board around requirements for the next phase of the business.
- This was followed by more intensive development against the CEO profile of three pre-selected leaders, considered most likely to show potential for CEO succession. This included unlimited coaching and advisory, ‘top up’ stakeholder feedback and regular status updates on developmental progress to the Board.
- In parallel, YSC conducted and presented research on the Board’s current levels of awareness and support for the potential candidates. This surfaced some potential biases and disparities in their knowledge about candidates; a targeted plan was developed which enabled fair and equal exposure to the Board.
3. Assessment and final acceleration period:
- Rigorous, externally benchmarked and independent assessments were conducted of the three short-listed internal candidates, against the Profile of Success and recommendations were made on readiness and ongoing development needs.
- The assessments were calibrated by a consultant with different gender and nationality identities who brought an additional DEI lens to minimise any unconscious bias.
- Candidates received feedback and an aggregate analysis was presented to the Board.
4. Decision-making and transition support:
- In the final stage, YSC is currently ensuring the motivation and on-going developmental impetus of the 3 candidates. We are supporting the CEO and the Board in preparing for and delivering on the final decision. We will then help to accelerate the performance of the successful candidate and provide transition support for those not appointed.
- YSC is seen as a key partner, valued for the strength of our relationships, our advisory, and passion for the business.
- As a measure of our enduring impact, the original scope evolved from assessing 2 candidates to a 4 year, multi-staged project.
- Acceleration of talent has been significant; all individuals showed significant growth (average 80% goal mastery achievement) against their behavioral goals.
- The process has been rigorous, and fair; the Board is assured that they have a strong external benchmark, and the right insight, data and support to make a well-informed decision.
- The company is well placed to appoint a strong internal candidate and to minimize unwanted turnover of unsuccessful candidates.