In recent weeks, we’ve watched as a number of high profile Australian and international leaders have handed in their notice. Some have given lots of notice while others have chosen to move on quickly.
Last week, the Head of Facebook in Australia and New Zealand, Paul Borrud, made headlines when he announced his resignation after six years at the helm. Then over at Air New Zealand their CEO Rob Fyfe also outlined his plan to resign at the end of 2012. And at Transurban their CEO Chris Lynch became another Australian CEO to announce their departure.
And internationally the long-serving co-CEOs of Research in Motion (the company responsible for the ubiquitous BlackBerry) have handed over the reigns to Thorsten Heins.
Closer to home and in the political sector, Labor’s Rob Hulls called it a day this month after 15 years in politics.
So what makes a CEO or high profile leader step down?
It could simply be time to retire. Time to clear out the inbox and spend more time with the family. It could also be a response to a scandal such as the resignation of the BP CEO following the oil spill in the Gulf of Mexico. Other reasons for a change at the top might include appointment of a new board, poor company performance or perhaps the call of a new opportunity.
Whatever the reason, if the communication surrounding the departure of a senior leader is handled incorrectly, it can have a disastrous impact on the company.
Investors get edgy and share prices plummet. Consumers lose confidence in the company and sales go down. The brand is damaged and competitors gain an edge. And most importantly employees become unhappy and decide to pack up their staplers as well.
So how should a CEO’s departure be handled?
First and foremost you need to ensure all stakeholders are informed in a timely and appropriate manner. Large organisations should build this communication into their succession planning so it should be a matter of pressing a button and beginning a process.
Large or small, you need to consider all of your stakeholders and their information needs. Think about the questions different stakeholders will have and make sure you have answers ready.
It’s also important that all key information is given to ensure that people feel comfortable in the change. Even though we all say “change is as good as a holiday”, it actually doesn’t compare to three weeks lying in the sun on a tropical island. So you need to relieve people’s anxiety by demonstrating how the person’s role will be filled and how their responsibilities will be managed.
It’s also important to celebrate the CEO’s time with the organisation, particularly if they’re retiring or moving into a more senior position. A CEO’s departure is also a great time to take stock of an organisation’s position and promote its achievements.
Above all, make sure your employees and board members have all the facts so they can rest assured that the organisation will continue to operate well after the CEO has punched his or her last timecard.
And if you’re the CEO, make sure you remember to hand back your passes and update your LinkedIn (but not before it’s all made public!).
Cheers from Jack & the c word crew