Sunday, August 13, 2017 1:00 am
Replacing ousted CEOs can be complicated
LISA GREEN | The Journal Gazette
Turnover in C-suites isn't unusual, but plenty of high-profile CEO exits, including at Uber and GE, have been announced this year.
For companies where executives have stepped aside under pressure, it can be particularly difficult when they are expected to help train a successor.
Replacing CEOs with insiders or outsiders can have challenges, although Les Trachtman, CEO of The Trachtman Group, thinks hiring externally is the most advantageous.
“The issue you have with an insider is you have somebody who was potentially trained at the feet of somebody who caused the problem or perpetuated the strategy that is being asked to be changed,” Trachtman, based in Annapolis, Maryland, said in a telephone interview. “You run the risk of perpetuating the status quo.”
There are benefits too, though, such as the connections and relationships an insider has already established. Insiders “are usually more readily accepted than an outsider is,” Trachtman said.
It doesn't mean an outsider might not be the best hire, however. “When you bring in an outsider you have the opportunity for what we call fresh blood,” Trachtman said. They might be more prone to listen and learn, lacking preconceived notions.
“If I was going to choose,” Trachtman said, “I'd choose an outsider, although they have to be good at establishing those relationships on the way in.”
Trachtman in July released a book titled “Don't F**k It Up: How Founders and Their Successors Can Avoid the Clichés That Inhibit Growth.”
Some statistics indicate up to 75 percent of company founders stay with a business, even if they are being replaced as CEO, Trachtman said. Oftentimes they continue on a company board, which essentially helps make them a boss of their successor.
An ex-executive may try to avoid publicly challenging the direction a new CEO may want to take the company. But Trachtman said you then potentially have uncomfortable scenarios where that person has to say to a successor, “Hey, I love all the changes you're making to the things I did.”
Top GLS site
Fort Wayne was again the top-attended satellite site Thursday and Friday for the annual Global Leadership Summit, which is hosted by a church in South Barrington, Illinois.
Kelly Byrd, a key local organizer and executive with Sweetwater Sound, said Thursday during the opening at Memorial Coliseum that more than 4,200 had registered for the Fort Wayne site.
The leadership summit is broadcast to about 700 satellite locations with more than 400,000 in attendance Byrd said.
This was the first year the summit was at the coliseum. It had been downtown, at both Embassy Theatre and Grand Wayne Center after being held for years at Blackhawk Church.
Chuck Surack, Sweetwater's President and CEO, said organizing the event required “thousands of man-hours.”
Mayor Tom Henry encouraged organizers and those attending to continue the momentum and the passion.
“You are the future of this community. Fort Wayne rests in your hands,” Henry said, adding he hopes the responsibility is accepted.
“Thank you,” he said, “for being in the position now to make Fort Wayne just a little better place to live.”
Summit speakers have varied backgrounds, including non-profits and for-profits. They discuss visionary leadership, the challenges they've had and strategies for success. I'll share some highlights in coming weeks.
To share a thought, a favorite quote or other wisdom about leadership, email Lisa Green at firstname.lastname@example.org. Lead On also appears online as a blog at www.journalgazette.net/blog/lead-on.