John Pepper and Durk Jager were each lifetime Procter & Gamble employees when they became CEO. Why then did John go on to be one of P&G's best loved, most successful CEOs and Durk get fired after 17 months?
Three keys to success:
- Pick the right person
- Manage the steps
- Re-balance the team
Pick the right person
This about matching the individual to the context and culture as described in my previous post. The right person has to be right not just for the business context, but also for where the culture is and needs to go in terms of Behaviors, Relationships, Attitudes, Values, and the work Environment.
Both John and Durk were well suited for the business context. John's attitude and values allowed him to build and maintain more productive relationships than Durk was able to.
Manage the steps
Five Steps:
- Create options for new CEOs (like GE's most recent three-way race and the current J&J race)
- Decide who will be the new CEO
- Announce the new CEO
- Transfer power to the new CEO at a specific point in time
- Support the new CEO in his or her efforts
P&G generally does as good a job as any in managing these steps. In Durk's case, the board found it was unable to keep supporting him.
Re-balance the team
The naming of a new CEO throws the leadership team off-balance even if the new CEO is promoted from within.
Presume not that I am the thing I was; For God doth know, so shall the world perceive, That I have turn'd away my former self. – Shakespeare Henry IV, Act V, scene v
Though not quite a new king, a new CEO immediately becomes different than he or she was. And his or her relationships with everyone need to be reset. Given this, people are scared. They want to know where they stand with the new CEO. Are they in or out? The sooner the new CEO can make decisions about who he or she is turning away and who he or she is keeping, the sooner the team can get back into balance.
John's leadership team got back in balance very quickly. Durk's never did.
Your thoughts?