Homestartup News

Coach Soch | The importance of a succession plan

This article is more than 1 month old.

Coach Soch | The importance of a succession plan

Mini

A short business narrative (of a 3 min read) that sets the context, challenge(s) faced, the type of leadership involved and the questions to ponder about, to solve for the issues. This is not to give answers; for business & life in general is not like a school-guide-book. This column is to provoke the reader to think more. And to sensitise that each individual or organisation are unique, and the answers would depend on the situation, difference in organisational culture, context, etc.

Coach Soch | The importance of a succession plan
To question is to think. To think is to introspect. To introspect is to seek. To seek is to be aware. To be aware is when the journey begins.
No founder can be a successful CEO forever; it’s human to struggle between the greed of holding onto influence and position, and wanting the maximum efficiency from the same role. No wonder, then, that companies struggle to have in place the right succession plan for their founders.
Replacing a Founder-CEO is one of the toughest acts, not only for that company’s board and key investors, but more so for the founder too.
Founders are the pillar of almost everything in a startup venture. They wield their influence across the length and breadth of the organisation. They have built the venture with emotion, loyalty, and competency. They have built the core relationships across the venture and in the external world.
A successful transition from a founder to the company's next leader is a tough ask from everyone. If not done well, years of hard work get undone quickly. At the same time, it’s alarming to miss the succession idea altogether and not meet the need-of-the-hour, that of a different leader.
What’s on founders’ worry-list?
Should I get a clone of myself or a different style of leadership?
What will I do post-transition?
What if the transition fails?
Will my investors agree? What if they like my successor so much and nudge me out fully?
How do I reduce the issue of bad candidate choice?
What type of cultural fitment should I seek for the incoming leader?
How much should I delegate upfront?
How do I trust the new leader?
What if the new leader hijacks my venture?
How soon is soon enough to allow the incomingleader to take complete charge?
Will my current CXOs have any concerns with the new leader? What if some of them leave?
What happens if the succession plan fails? What should be my Plan B?
Why succession is difficult
To maximise the probability of a successful transition, it is essential to understand the mindset of a dounder and what drives them. Unless the ‘next’ role for the Founder is defined well and, more importantly, internalised and accepted by the founder, there could be periods of deep pain that the organisation will face in terms of the founder interfering. Such interference could hurt the transition process and also undermine the authority of the new leader.
Successful founders are value creators. They dream big, and execute well. They constantly take feedback and shape their dreams into achievable outcomes. They constantly seek to identify problems and solve them. They are passionate and can convince others to join them in their “mission”. They can be persistent and convincing. They can be trying others' patience, and yet, command such a strong sense of loyalty.
Founders are subsumed by their venture, and oftentimes don't have anything else to do. If they leave the venture, they may face a time-void shock, if not knowing what else to do, or feel a sense of being lost without their venture and its insane energy and the people around on a daily basis.
If the founder moves from day-to-day role into a governance or stewardship role, they need mentoring help in ensuring their change management. Often, the challenge is to allow the new leader to learn by their own method and style, while balancing the culture of the venture. The founders need to step back, and yet allow for their own learnings, skills and experience being available through a governance role, or by simply being a mentor.
Since very few ventures can succeed without the passion and the insane hours that founders invest into them, it is a tough ask for the founder to figure out what to do next. No doubt, most ventures' founders actually resist the issue of succession. For, in the world of ventures, succession is not dependent on wealth created so far or the age of the founder — it is dependent on what right for the venture.
Smooth leadership transitions require meticulous planning, transparency, and patience — before, during, and after the handover. If you are thinking about your succession plan, now is the time to think it well.
– The author, Srinath Sridharan is a Corporate Adviser and Independent Markets Commentator. For other articles in the Coach Soch series, click here.
next story

    Market Movers

    View All
    CompanyPriceChng%Chng
    CNBC TV18 LIVE TV
    View Shows