As the much-anticipated final season of HBO’s Succession approaches, our research has revealed that the lack of successful transition plans might not be limited to the hit TV series. In a survey of over 500 UK CEOs, ECI’s Growth Characteristics report found that only half of CEOs (51%) have a succession plan in place
Effective succession plans are a way of ensuring stability in a company while minimising disruption, therefore it’s wise for CEOs to start thinking about one well before they plan to leave a business.
Just as Succession’s patriarch and media tycoon Logan Roy decides which of his children will succeed him as CEO, the ECI report also highlights that 15% of business leaders want to keep their company in the family, not far off the 20% that are looking to pass the position onto their leadership teams.
Tom Wrenn, Managing Partner at ECI Partners said:
“While the drama Succession is a parody of the realities of succession for most business owners, planning for the future should always be on the agenda for any CEO. Not only for their own teams but also investors are always keen to understand whether a CEO intends to be part of the business for the long term. If you are not looking to lead the next exit, flagging your succession plan to investors early on can instil confidence, acting as a great indicator that a roadmap is in place for employees and the leadership team.
The impact on culture can be very important, as the role of the CEO is often to preserve the company culture as the business grows. Choosing a successor is a key part of ensuring that the secret sauce for what made the business successful under one CEO is retained, and the company values are carried through under new ownership. We often support those looking for succession to transition to an advisory or Non-Exec role to ensure the continuity that is so key to business growth.
If nothing else, the chaos of the Roy family will hopefully highlight to those leadership teams who haven’t yet thought about succession planning, the importance of having a solid plan in place.”