Chances are good that your organization is going to appoint a new CEO or other senior leader very, very soon.
CEO turnover rates shot up from 11.6% in 2010 to 16.6% in 2015, according to McKinsey. And since 69% of new CEOs make changes to their management teams within the first two years, transitions then cascade through the senior ranks.
But too many senior leader transitions don't go smoothly. McKinsey cites studies that demonstrate that when leaders struggle through the first months, the performance of their direct reports is15% lower than it would be with high-performing leaders. Those team members are also 20% more likely to be disengaged or to leave the organization.
While there are many factors that determine whether a new senior leader will be effective, here's one that some CEOs downplay: effectively communicating with key stakeholders.
"It's surprising how often a new CEO underestimates the time needed to engage with primary stakeholders after
And Mark Thompson, who left the BBC to become CEO of The New York Times Company in 2012, said in a Harvard Business Review interview that "There's a real risk that the new CEO will spend the first six months in the C-suite, locked in rooms with the finance and strategy teams. This is part of what you do, but it's useful to get a sense of what it feels like away from headquarters."
The risk of under-communicating is that the CEO loses valuable momentum. Critical stakeholders--including employees, customers and partners--are left to speculate what you stand for, and how you will put your stamp on the organization.
What's needed, advises Di Maria, is a strong game plan--a strategy that's ideally been set well before the CEO's first day.
Here are 3 key essential elements of an effective new leader communication effort:
1. Set clear and specific objectives.
A number of people--including the board of directors and other senior leaders--will have an opinion about how you should communicate. To create agreement about what success looks like, develop objectives that clearly articulate desired outcomes. Here are sample objectives:
- Ensure the change is seen as a logical next step in the leadership chain.
- Enable a smooth leadership succession, with clearly defined roles, over the agreed-upon timeframe.
- Leverage transition to showcase company performance and strategy, and set the stage for continued future success.
2. Identify key stakeholders with whom the CEO will communicate.
Especially in the first few weeks, your schedule is tight, so you need to build a communication plan that a) sets priorities for how you spends time and b) maximizes your visibility.
"Most new CEOs understand that their first priority should be employees," says Di Maria. "This is your opportunity to establish a presence, convey purpose and, most importantly, listen to employees' concerns and ideas."
The second priority for succession communication? Customers. "As with employees, the purpose of communicating with customers in the first weeks is not to deliver a message--it's to create a connection, establish a relationship and be open to hearing what's on customers' minds."
As soon as you take the helm, you needs to spend face time with both employees and customers. For other stakeholders, says Di Maria, you can rely on written messages, video, social media or other communication methods. And Di Maria advises holding off on media interviews until the new strategy is set.
3. Develop primary messages designed to engage audiences. Every CEO needs time to work with the board and leaders to plan his or her strategy. But you can't just smile and wave; stakeholders are very interested in what you have to say.
As New York Times CEO Thompson puts it: "Most people expect you to start telling them what you want them to do on your first morning. That's not reasonable or possible. The temptation is to shoot from the hip, to start forming snap judgments and barking out orders. If you don't do any of that, it's probably a problem. But the other extreme is to go into listening mode, where you can look very passive. So you're trying to find a spot on the landscape somewhere between those two extremes."
Di Maria recommends developing succession messages that include:
- An overarching story. What's happening in the market and in the company and how you're moving forward in your new role.
- Success themes. Where the organization is today, with an emphasis on the positive. (If the company is in crisis mode, the focus should be on what needs to change.)
- Credentials. How your experience has prepared you for your new role.
- Your journey. How you'll be spending your time, and what people can expect from you (and when).
"As the saying goes, you only have one chance to make a good first impression," says Di Maria. "So it's essential to invest in communication that will set you up for success."