Why So Many Companies Fail at CEO Succession Planning
It is easy to see how a smooth change in leadership is critical to the success of any organization. A poorly executed CEO succession has immediate negative effects on stock price, strategic momentum, company reputation, and employee morale. There is every reason for a board to get succession planning right, but too often the process is not given enough consideration. When board members adopt a lazy, reactive approach to assuring a frictionless change at the top of an organization, they fail to deliver on one of their chief obligations to shareholders. Why is succession planning so poorly practiced? Here are five reasons that can be easily corrected, if only directors will take ownership of the responsibility.
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