When the consequences of leadership transitions are so great – and carry so much potential for chaos and disruption – how can you make sure your organization comes out on top?
Few issues are more pressing – or more consequential – in today’s chaotic environment than the mass exodus of employees known as the Great Reshuffle. Just last year, 47.8 million workers left their jobs – 33 percent more than the year before, according to the Bureau of Labor Statistics.
And the stakes just got raised because executives are now increasingly exiting positions.
Reports suggest that upper-level leadersare on the move. Companies appointed a record number of CEOs in 2021 – a 22 percent increase from 2020, according to executive search firm Heidrick & Struggles. The trend will likely continue.
No matter the level of the employee, any resignation poses a significant challenge – rehiring costs, the loss of institutional knowledge, and decreased morale hinder organizations’ abilities to pursue strategic business objectives. But when a leader departs, the high visibility and intense pressure from stakeholders raise the stakes even more.
In the face of unprecedented uncertainty, companies will benefit from reimagining and reframing the Great Reshuffle. No longer a malevolent drain on your organization’s resources, productivity, and culture, a leadership transition offers a strategic opportunity to gain valuable insights about your leader’s position, their ecosystem, and the organization at large – but only if you do it the right way.
To begin, it helps to start at the end:
Strategic offboarding to uncover new insights
When a leader leaves, the rush to begin the search for a replacement dominates everyone’s thinking. From there, in the interest of time, you may simply dust off the previous position description and circulate it internally before sending it to an executive search firm.
Rather than rush into a search, this time is an invaluable chance to reflect and refine. That is, strategic offboarding with the departing leader can uncover important intelligence, while setting up that person’s replacement for success. The first reaction in this new approach is to schedule as much time as needed to talk to the departing leader. Given the importance of the role, businesses can’t afford to not take this step.
Explore the following areas as you offboard a leader to discover insight into what the position requires now or will in the future – not what it required when that person started, which could have been years ago.
This process will uncover:
- Where the work was thriving and where it was suffering.
- Where there are risks.
- Where there are untapped opportunities.
- The wellbeing of people within that part of the organization.
- How diverse and effective your leadership networks are.
By gaining this understanding to shape the future of the work and the role, a sense of purpose and readiness can inform the type of candidate needed to fill the void. Just as importantly, the knowledge can be passed on to the new hire stepping into the position. That’s smart business, and a positive way for the new leader to make a smooth transition.
Being prepared to make smooth leadership transitions creates a competitive advantage
Changing a leader is obviously much more complicated than changing a tire – but there are lessons to learn from the poetry in motion of Formula One pit crews. Their ability to create a smooth transition can spell victory or defeat. The average pit stop, including changing four tires, is 2.4 seconds. The world record is an astounding 1.82 seconds, according to Car and Driver magazine.
On race day, those milliseconds are a competitive advantage. But the magical precision happens long before race day – resulting from the preparation needed to deftly coordinate and execute several critical activities simultaneously. The thorough pre-event planning enables up to 20 mechanics to descend on the car, flawlessly transitioning a driver back to the race.
It all hinges on clarity of roles, priorities, and execution during these transitions. There is no room for chaos or pauses, which will cause loss of productivity. The efficiency begins with communication.
Within each team, extensive learning takes place to ensure the best tools and methods are used.
Likewise, well-executed leadership transitions make the difference between increasing an organization’s competitive edge or losing ground to a competitor. Leadership transitions are a strategic opportunity – not a process to be endured. There is a tendency to simply get through the transition and fill the role based on past strengths and weaknesses of the departing leader.
This is a mistake and a missed opportunity.
That view is changing as the significance of leadership transitions gain the appropriate attention and value they deserve. While greater attention is being given to onboarding, and to a better use of the exit interview and alumni networks, few organizations use the process to hone their business strategy.
Adopting a design-thinking approach to leadership transitions can glean strategic insights that sharpen the business, create better onboarding experiences for new hires, build stronger alumni networks, and strengthen brand reputation.
How to use leadership transitions to ensure the role and the replacement meet organizational needs
A thorough and thoughtful transition framework designed to meet the present and future needs of the organization may take more time, but it will likely save significant time in the future when the new leader begins.
A useful starting point during the transition is to evaluate the domains and insights of the leader’s current role and relationships gained during that person’s offboarding. Ask questions such as:
- Should the role be replaced or does a re-organization make sense?
- If a re-organization is needed, how will you create smoother transitions for employees?
- Who will the leader need? Who will need the leader? Think in all directions – internally and externally.
- What are the areas of focus and priorities for the role?
- What is needed from the new leader?
- How will decision-making be managed in the newly created environment?
- What legacy knowledge will the new leader need to know to start strong?
A neutral third party will help navigate executive transitions by engaging the right people and designing the new role and onboarding journey.
For instance, experts can deliver a personalized, highly immersive experience to launch and support successful transition. An action-oriented plan customized to a leader’s personal style will maximize opportunities before, during, and following a transition.
A successful approach includes investigating transition strategy through several lenses and perspectives, including the design of the role, the priorities and focus, the decision-making responsibilities, the skills and experience, and the networks needed for the new leader to be successful. Onboarding process questions can include:
- How long should it be?
- What are the key milestones the new leader faces?
- What kind of support will the new leader need?
As human resources professionals face intense pressure to fill vacant positions and sustain productivity levels, they also need to protect their employer brand. In addition to the historic turnover rates, employee burnout and engagement as well as diversity and inclusion pressures make this moment in time particularly challenging.
Thoughtful leaders are changing their perspective and see this period of tumultuous labor shifts as an opportunity to reimagine how they work and do more than tread water. Though generally not seen as a high priority, strategic offboarding creates a unique opportunity to make progress on multiple fronts by adopting an approach that allows the organization to learn and adapt as they navigate executive transitions.
If good employees must leave, enable them to leave well – and the leave the organization in a better place.