Preparing Your Successor.

5/11/12

In previous posts I have lamented the low percentage of CHROs who came into the role through an internal succession process (36%), particularly when compared to CFOs (54%). I have heard a number of reasons for why that might be. When I asked Hal Johnson of Korn Ferry, he said he thought it may be because even though a CEO might have met and observed the potential successor, s/he may just have a difficult time picturing that individual in the Top Seat.

At a recent program aimed at developing potential successors to the CHRO role, a number of CHROs mentioned how difficult it can be to navigate interactions with the board of directors, particularly early on in the job. New CHROs seem particularly at risk of making early missteps in this area, and some such missteps can result in irreparable damage to their careers. Any poor performance in front of the board from any of the executive team reflects poorly on the CEO, so they are protective of who and when they allow such interaction. My guess is that one reason for the failure to internally place more CHROs stems from their lack of experience with the board, which leads CEOs to prefer someone who has board experience, even if in a smaller firm or from a different industry. Such a strategy is understandable, but, I would argue, misguided and one which CHROs need to oppose.

The scuttlebutt among the participants (most of whom were from brand name companies) in the program seemed to be that perhaps their best career strategy was to take a CHRO role at a smaller firm in order to get the experience they need to land a later CHRO role at a larger firm. While that may be good career management from their standpoint, it causes large companies to lose their best talent. However, it doesn't have to end that way.

CHROs who reached their positions through internal succession had the following suggestions.

1. Start by giving potential successors visibility with the Executive Leadership Team members. This is about giving them a trial run long before exposing them to the board.

2. Be open and transparent with them about how you prepare for the board meeting, and debrief them after regarding what happened. Let them begin to learn vicariously through your experience.

3. Invite them to attend some of the social functions (reception, dinner, etc.) with board members to begin their interactions in an informal way, rather than throwing them into presentations. Let them build relationships before they need to prove their credibility.

4. When it's time to let them present, rehearse, rehearse, rehearse, trying to prepare for the kinds of questions that they will likely face.

5. Try to make their first formal presentation around something short and uncontroversial to minimize the chance of failure.

This seems like a lot of work, but wouldn't you expect any of the other executives to invest that much time and effort into their top talent?