From time to time, a small business leader finds him or herself in a position in which they need to transfer the reins of power to a new senior leader. Sometimes this occurs when there is a transfer of ownership from one generation to the next. Or, perhaps the business is sold and the new owner is stepping in to take over.
Regardless of how it comes about, when it is time to transfer executive leadership from one individual to another, it is critical that this transition is taken very seriously and follows the following few essential steps.
Make the transition a process… not an event.
As soon as it becomes evident that a new leader will be taking over control, begin planning for that succession and think it through in its entirety so that the transition is as smooth as possible.
The goal here is continuity. If possible, you do not want to make a major shakeup in the culture, direction or overall vision of the company. Changing leaders is hard enough, but changing leaders and the core structure of the company all at once usually leads to catastrophe.
The two leaders must over-communicate.
It is essential that the person who currently holds the leadership position and the person who is stepping in as the new leader take the time to discuss in detail all of the relevant organizational information in a very frank, open and honest fashion. This includes a thorough analysis of the financials, discussion about the current corporate culture, key employees, the long-term vision of the business, the competitive landscape, how they are differentiated in the marketplace and any other substantial business issues. The goal here is to transfer as much knowledge from the current leader to the new leader as possible.
Over-communicate to the employees.
Whether you have two employees or 2,000, leadership transitions are always scary to staff. Therefore, it is essential that the current leader explain to everyone in the company how the transition will work, why it is happening and assure them that it will be as smooth and painless as possible.
It is also paramount that the new leader, as soon as they take control, clearly communicates their vision, values, goals and expectations. The more information the new leader gives to the staff, the less that they will be paralyzed by fear and ambiguity. The goal is to show confidence, continuity, competence and transparency.
The First 100 days.
Once the transition has occurred, the new leader has about 90 days to establish their agenda and take over as the recognized leader of the organization. During this time, it is common for the people in the organization to blame everything that goes wrong on the former leader. That’s normal, but after about 90 days the new leader will now be held 100 percent accountable for the performance of the organization and will take responsibility for any issues or problems that may arise.
Transitioning from one leader to another, especially in a small business, can be very challenging. However, if you make it a process, create a detailed succession plan, speak with a consistent leadership voice and over-communicate to everyone involved, there is a good chance that the transition can reinvigorate and motivate the organization to new levels of success.