“It’s precisely at this stage that the board needs to step up. If the CEO was an exceptional performer during the honeymoon and consolidation stage, this is unlikely to happen; human instinct is to trust the track record. Over time, the CEO may even have filled the board with people indebted to him or her, who do not really take their review function very seriously. The result is that the board takes action only when things become really catastrophic — by which time it is often too late.
“Leadership programs can also provide a form of stock taking. Through reflection — studying ”the leader within” — the CEO can increase his self-awareness and by working in a group he can exchange ideas with peers in similar situations. Quite often, leaders who engage in this discover that they do in fact want to step down and find another job in a new environment. Other CEOs take on a role as mentor or leadership coach to younger executives, which is a highly effective way of maintaining continuity in the organization and also helps to reduce the CEO’s anxiety about leaving.
“In Stefan’s case, his reluctance and the board’s to contemplate change meant that it was eventually forced on them. A well-known activist shareholder bought a sizable stake in the company and laid out the case for major change in the financial press. It didn’t take long before he was given a seat on the board. With the help of fellow shareholders, he pressured the directors to push Stefan aside and appoint a new CEO.”
Does this sound familiar?
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