Every company will experience moments of crisis. Although the timing can be unpredictable, the nature of the crises is often common. One of the most predictable crises that come about at least once in the lifespan of any company is the “changing of the guard” when, through the acquisition of new ownership or the retirement of several executives in a short time span, the company must fill several executive positions.
In the case of family-owned businesses, the new executives will most likely be from within the family, properly groomed and vetted to provide continuity for everybody the company as it moves into the future. While new blood will inevitably mean that things will change, the passing of the torch is soother and rather than trying to create a new corporate culture, the new executives tend to focus on helping the current culture evolve. They are more likely to default to the way things have been if there is no discernable reason why they should change.
In the case of privately-owned businesses where new ownership has resulted in the mass exodus of executive officers, there is much more of a shakeup on the horizon. But finding the right executive officers can be tricky. The right executives can make or break any company, most especially a company in flux, so it makes sense for owners to invest heavily in an executive management team.
In most cases, when a change of leadership is on the horizon, the company will implement a Succession Plan. That involves gathering a group of bright up and coming officers from within the company and giving them the necessary grooming to make the hand over smooth. This sort of “buddy system” whereby the outgoing executives introduce the aspirants to their networks and slowly hand over more and more executive responsibilities over an extended period of time, is most easily implemented when the senior executive is retiring. In order to choose which candidates would be ideal, it might be in the best interest of the company to put all potential candidates through a series of performance and personality assessments. These can take several forms and are only part of a larger, more arduous process. You may want to look into pre-employment assessments such as the Berke Assessment.
Succession Plans can also be used to help ease the transition when there is new ownership. Much of how this transition is handled will be dictated by the terms of the sale. Whether the new owners have an executive team ready to go or will be making personnel changes according to their needs, there are a number of elements that need to be considered as you rebuild your executive team.
Nothing contributes more to employee defection than poor communication from the top. Uncertainty is a team killer, and you need to be sure to keep it to a minimum. While some people espouse the idea that suspense encourages healthy competitions, the truth is that it is very damaging to morale and motivation at every level. New executives should be visionaries who are able to sell their concepts to others. Make sure that your newly hired executives are good communicators to help ensure a smooth transition.
Sometimes executive shakeups are the result of the passage of time. Other times it is the result of the organizational upheaval that accompanies a crisis. If you need to restructure or fundamentally change the corporate culture you should do so with a clear objective in mind. Be sure to communicate this new direction to all of your employees from the executive level on down. Make sure that everybody is clear about what you expect and what your vision is going forward. Be sure that your new executive team has the passion to bring your vision to life.
Retain the Wisdom
Outgoing executives have a treasure of knowledge and experience that you may find useful. Though they may be leaving the company, they should be retained as advisors, analysts, or consultants. Taking advantage of their experience in an unofficial capacity is one way that you can help everybody transition smoothly.
Know What You’re Looking For
Hiring new executives is tricky business. You will need problem solvers who can think critically and analytically. They should be able to pivot easily and flexible enough to integrate themselves into the established corporate culture.