When the average CEO tenure is shrinking and the appointment of a new CEOs happens more frequently, planning and executing CEO succession communications is becoming a core competency for chief communication officers.
Based on an analysis of leading Fortune 100 companies and our own experience managing CEO changes, here are some key insights and lessons my company has learned about CEO transition communications.
1. It’s important to understand and manage the dynamic between the outgoing and incoming CEO.
How the standing CEO interacts with his/her named successor and the way that relationship is portrayed is a key element to success.
- Internal candidates are generally viewed more positively by all stakeholders than external candidates. But this also depends on the health of the company at the time. If the company is in crisis, then bringing in an external executive could be seen as a positive.
- That succession is taking place as a result of expected, voluntary retirement is the best message to convey in a transition. In other words, a new CEO being named is part of the company’s known succession planning process. The message here is: “It’s a change in leadership, not a change in strategy.”
- It’s important to acknowledge the legacy of the outgoing CEO—unless the exit is taking place under a cloud. Activities should be based on the personality of the CEO and the company culture. Ideas range from naming a company building after the person, making a donation to a favorite charity, and holding events. One company hosted an ice cream social because that was in keeping with the CEO’s low-key nature. Select media interviews can be used to profile the outgoing CEO’s successes, and reaffirm the company’s health.
2. Intensive planning is key to success.
Rigorous and detailed planning is imperative. It’s not too soon to start the communication process at least one year before a CEO announcement. Plans should be strategic yet very tactical: you should know exactly who will do what when.
- This is an excellent opportunity for the CCO to also play the role of chief collaboration officer. Close coordination with the board and other members of the C-suite, such as the head of human resources, the general counsel and the chief financial officer, is a best practice.
- Create a master document with objectives, roles, responsibilities, narratives for each senior leader and a day-by-day schedule.
- Develop bios, research accomplishments, and gather photos for all the potential candidates for the position. Identify internal and external references, such as former bosses and industry experts, who may be quoted.
- Spend the most amount of time on message development. What will the outgoing CEO say to each audience? What will the incoming CEO say on Day 1 and then on Day 100?
3. Controlled communication is imperative.
Of course, for publicly held companies, the naming of a new CEO is considered material (that is, likely to have an impact on perceived company value). If a president or CCO had already been named and was assumed to be the heir apparent, there is more openness about succession. If it is a “horse race,” in which there is close competition among several candidates, then even more care is needed to not indicate the “winner” until the board has officially voted. Issue a press release the morning after the board vote, in much the same way you would distribute an earnings announcement. Once you’re ready to share the information:
- Prioritize employee communication over media. Tactics include a combination of all-employee emails, webcasts, online videos and town halls. In some instances, the outgoing CEO should lead the communications; in others the new CEO should, and in still others, the old and new share the communications. Communicators should be ready to make the recommendation that best fits the circumstances of the company.
- Be selective and strategic in how you approach media. Usually, just one or two interviews should be given with major business press, and perhaps the leading trade press. It’s best not to overexposure the new CEO with media until he or she has been in office six months. They need time to crystallize their vision for the company—and the emphasis should be on spending time with employees and customers.
While every situation is unique and has its challenges, the transition between leaders is an opportunity to reaffirm a company’s future—and demonstrate the strategic role of communication.