Leadership transitions are tough to execute. Typically, you're managing the fallout from a previous leader's unsuccessful attempt to generate the desired result. Fear, uncertainty and doubt can ripple through the organization: Is my job safe? Is the company in financial distress? Is our product or service offering failing in the market? What's going to happen to the business?
Most importantly, everyone wants to know, "Who's the new boss, and will they be successful?"
In their book, Leading Organizations: Ten Timeless Truths, McKinsey Senior Partners Scott Keller and Meany took an in-depth look that the reasons why leadership transitions fail. What they found is that by focusing with the new executive on five key performance areas, new leaders can significantly reduce their likelihood of failure.
Leadership transitions have a massive financial impact on the business, and the incentive to get it right is clear. According to Corporate Executive Board, if the leadership transition is successful, there's a 90 percent likelihood that the team will go on to meet their three-year goals, and a 13 percent lower attrition rate among employees. On the other hand, unsuccessful transitions lead to 20 percent lower employee engagement and 15 percent lower team performance.
Keller and Meany report that 75 percent of new executives feel unprepared for their new role. The biggest reason? Organizations take a "hands-off" approach to onboarding the new executive, treating it as a one-off event and not creating a structured process for evaluating progress and results. Don't make that mistake with your next critical leadership transition. Instead, work through this simple but effective transition plan with your newly minted senior leader:
Ask: Does your new hire truly understand the business, and its current performance strengths and weaknesses? Have they taken quick action to mobilize their team towards future aspirations and priorities?
If your newly hired leader doesn't have the right read on the current state of the business, they're going to draw the wrong conclusions about what to do next. They'll mobilize their team and point them in the wrong direction, costing you time, money and opportunity.
Ask: Do they understand the current culture, and any shifts required to improve performance? Are they influencing these shifts with all the levers available?
If your new leader fails to grasp the culture, they're going to put the wrong incentives and systems in place.
Ask: Do they have the right team with the right skills and attitudes and the right structure? Are they putting a plan in place to transition to a high-performing team?
When your new leader is stepping into an organization that's struggling to hit targets, it's most often a result of having the wrong people in the seats, or having the wrong seats in the first place (or both). A leader who can't make decisive moves in this regards will under-perform.
Ask: Has your new leader done what it takes to get up to speed, set boundaries and consider the legacy they want to leave? Are they spending their time wisely by assuming roles only they can play?
One of the biggest risks to your new leader happens if they spend their critical early weeks and months focused on the wrong things.
Ask: Do they understand their mandate and the expectations of other stakeholders? Has your new leader established a productive working rhythm and relationship to shape their views?
They're not the only fish in the pond; they're going to have to work well with their peers, and they'll have to put in the time and effort to build strong, trusting relationships.
The hiring and onboarding of new senior leaders - whether through internal promotion or external hiring - shouldn't be taken lightly. Success is a result of proper planning and a bias to action. Focus on these five areas to maximize your potential for a successful transition.