Biggs, Errol L.
Academy of Management Executive Vol. 18 Issue 1, p. 105-107
The article discusses the importance of chief executive officer (CEO) succession planning for corporate success. In a recent survey of public-corporation CEOs conducted by the National Association of Corporate Directors, CEO succession had risen to the second most important issue facing boards of directors. As in the past, one way to avoid the hassle of searching for a new CEO is to have the successor often be an internal candidate already identified and groomed to take over when the current CEO steps aside. The board’s role in succession planning comprises several tasks. Although the CEO is the central player in the process, the board should understand this is a joint duty and not one delegated solely to the CEO. Many organizations have found it is beneficial to go outside the organization to look for a new CEO. To minimize the disruption created when a CEO departs unexpectedly, an internal individual can be designated as the acting CEO. No two succession scenarios are identical and therefore a variety of possible conditions may confront the board as it faces the challenge. A primary internal candidate may thus need to be passed over as CEO-designate as part of a bargaining position or in deference to perceived equity with the other entity.