Senior Leadership Changes Can Interrupt Organizational Culture

Talent development continues to be an organizational focus. Organizations are asking their managers the question, “What are you doing to develop talent? And specifically, your replacement?”.

The primary role of a manager is to hire and train their replacement. It goes without saying that a big interrupter can occur in company culture when there’s a change in management. Organizations don’t always get to plan for management changes, so when they do, it’s a big deal. It’s a visible process that demonstrates whether the company really lives their cultural values.

In the book, “Succession Transition: A Roadmap for Seamless Transitions in Leadership”, Plante Moran Managing Partner Emeritus Bill Hermann and current Managing Partner Gordon Krater share their formula for successfully transitioning management responsibilities at the firm. Plante Moran is the 14th largest certified public accounting firm in the U.S. It has over 2,000 employees and has been recognized as a “best place to work” by Fortune Magazine for 13 consecutive years.

Hermann and Krater outline how their transition took 8-9 months. Let that sink in for a moment. Almost a year. Some of it could be attributed to the position of managing partner. But after reading Hermann and Krater’s story, it could be argued that the successful transition of managers takes months. Emphasis on the word “successful”.

And that’s how Hermann and Krater defined the goal. The goal of transitioning management responsibility was for the incoming and outgoing managers to maintain credibility. Both of them. Equally.

So many times, when we think of transitioning management, it’s because one person is leaving the company. In this situation, Hermann wasn’t leaving. He just wasn’t going to be managing partner anymore. It could hurt the organization if the transition didn’t preserve the individual’s credibility.

In today’s work environment, we are going to be faced with more situations where a manager transitions and doesn’t leave the company. Maybe they move to another department, division, or position. Maybe they retire and come back as a part-time consultant. Organizations have to put more thought into the transition process. Hermann and Krater shared three phases to a successful management transition that apply at any level of the organization.

  1. Become knowledgeable about the company. This might seem like the easy part because it includes understanding the financials and the business. It might involve some technical training. But knowledge of the company means giving individuals the experience they will need in a future role. It’s allowing them to make mistakes while gaining knowledge. Remember the goal of maintaining credibility while creating a teachable moment. It can be tricky.
  2. Take responsibility for the organization. Great managers should try to leave the organization better for their successor. They don’t “kick the can down the road”. They take care of business and do what’s in the best interest of the organization. Once a successor has been identified, managers need to step aside so the successor can start to assume responsibility. But not step so far into the background that it appears the new manager isn’t getting the support they need to be successful.
  3. Maintain the company culture. We all know that culture is the number one reason people come to work for our organizations and the number one reason they leave. Managers should not only act in the best interest of the organization but also its culture. For example, in organizations where employees know the founder and remember the early days, it can be hard when a new manager takes over the reins. New managers need to understand and preserve the culture.  

A lot of organizations do Phase 1 and 2 well. Managers know the company and their responsibility. It’s the culture component that can derail their success. Company culture is made up of those moments of truth about who the company hires, promotes, recognizes, and fires.

There’s a well-worn statistic from Pew Research that says 10,000 Baby Boomers turn of retirement age every day. While they’re not all leaving at once, Boomers at some point will transition out of the workplace. Organizations need to start having open, honest conversations about successful transitions and give the process the time it deserves.

 

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