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Business Observer Friday, Mar. 29, 2013 7 years ago

Passing the Baton

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How to successfully transition leadership in your organization.
by: Denise Federer Bottom-line Behavior

Have you ever made the decision to bring someone into your company in an executive leadership role or promoted someone within in your organization only to be dismayed that they failed miserably? If so, you are not alone. In fact, research suggests that regardless of the time and effort that went into that decision, the failure rate for “external” hires is high in the first two years, ranging from 40% to 60%. Internal promotions face similar odds.

Why is there such a high probability of failure? Did you overlook factors when making the choice of your leadership candidate? Did the individual misrepresent themselves? Or perhaps they had the “technical” skills for directing a team, but did not possess the necessary “people” skills to manage others. In many cases it is none of the above, but rather a lack of preparation on the part of upper management to create an environment that will ensure the new leader can successfully achieve organizational goals.

The consequences of an unsuccessful leadership transition go beyond your personal frustration and can have adverse implications for your entire company. Not only does a failed transition result in financial costs, but it is difficult to recover from the time lost on such a misstep. Just as critical, is the potential negative emotional impact that an ineffective decision can have on the culture of the company. Therefore, in order to ensure the sustainability of your company, you as a leader must assume some responsibility for this process.

The Individual's Role
When an individual accepts a new leadership position, success depends on his or her understanding of the assimilation process. He or she needs to recognize the nuances of the work culture, identify potential challenges and demonstrate the emotional intelligence to successfully navigate possible “landmines” in the work environment. Additionally, those who focus on identifying and building key relationships and work to achieve early wins on critical issues increases the likelihood of acceptance in their new role by their team.

Upper Management's Role
However, regardless of an individual's knowledge and potential leadership skills, if upper management does not engage in certain behaviors the process is doomed to fail. Success becomes more likely when management addresses four key factors: role clarity, communication, empowerment and identification of potentially negative interpersonal dynamics.

The most important aspect to ensure a successful leadership promotion is to have role clarity. This means the individual understands the scope of his or her position, its relationship to others in the organization and how success will be measured.

Next there needs to be clear communication. The biggest mistake many CEOs make is not proactively publicizing to the rest of the staff about the exact nature and scope of the leadership decisions being made. Especially when employees are promoted internally, this can cause widespread problems with their former peers. Therefore it is critical that leaders make organizational changes in management transparent and clearly communicate the reasons behind the change along the way.

Along with a lack of communication there is often confusion about the extent of power that a new position holds and what that means in the chain of command. There is nothing more frustrating to an individual than having responsibility without the authority to make decisions. To avoid this, establish clear boundaries and empower the individual to make decisions commensurate with the position. Micromanaging the role and/or tolerating direct reports to be non-responsive to a new leader's decisions will dilute his or her ability to gain respect as a leader of a team.

Finally, upper management needs to identify the interpersonal dynamics that can potentially undermine a newly promoted leader. Acknowledging the players and politics in your company, being up front about potential human pitfalls, and providing ongoing support are all necessary for a new leader to positively accomplish the goals of his or her new position.

Conclusion
Effective leadership transition is necessary for organizations to maintain their sustainability. The cost of failure can negatively impact both the emotional and financial well-being of a company. However, CEOs and upper management can increase the odds of success by acknowledging their part in this process and addressing critical issues proactively. Specifically, as the owner/senior leader of the company it is essential that you make no assumptions or take for granted that others around you understand your priorities. You need to clarify your expectations of the leadership role, the boundaries of the position and how success will be measured. Just as importantly, you need to empower the position by communicating your intent to the rest of the organization. Finally, by providing ongoing support and guidance to your new leader, you will increase and hopefully beat the odds to ensure a successful leadership transition.

Denise P. Federer, Ph.D. is founder and principal of Federer Performance Management Group. She has 27 years of experience working with key executives, business leaders and Fortune 500 companies as a behavioral psychologist, consultant, coach and trainer. Contact her at: [email protected]

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