Even during the crippling global pandemic, while facing unprecedented turmoil and massive uncertainty, many companies have made major changes in their senior leadership ranks. Among the marquee brands that have named new CEOs in the past year are Amazon, Disney, Ford, Harley Davidson, HKEX, Honda, IBM, Intel, LinkedIn, Mastercard, Merck, MGM, Patagonia, UnitedHealth Group, Volkswagen, and Walgreens. The Gates Foundation, one of the largest charitable organizations in the world, welcomed a new leader as well.
Although 2020 saw less turnover at the top than 2019 overall, according to CEO tracking specialists, hundreds of exits and onboardings occurred at prominent global companies. As always, the organizations involved were under tremendous pressure—from shareholders, employees, customers, and others—to make the right choices.
Unfortunately, many choose poorly. Botched CEO appointments, Thomas Keil and Marianna Zangrillo observe in the Winter 2020 issue of MIT Sloan Management Review, cost companies tens of billions of dollars annually in market value. Short tenures are common, even among “seasoned executives with previously unblemished track records,” they note, observing that research they’ve been conducting indicates that “more than 15% of all CEOs depart within two years.”
“The best-laid plans—especially succession plans—often fall apart when they encounter reality. What is surprising,” they add, “is how shocked and appalled boards are when their CEO choices fail—sometimes repeatedly.” What accounts for the failures in these CEO choices? READ MORE
By Allison Bailey and Grant Freeland
All senior leaders taking new roles need to develop and implement a strategy to reinforce or reshape their leadership brand starting well before their official “Day One.” The author offers steps leaders can take to make sure they are starting off on the right foot.
What if a company built each component of its product from scratch with every order, without any standardized or consistent parts, processes, and quality-assurance protocols? Chances are that any CEO would view such an approach as a major red flag preventing economies of scale and introducing unacceptable levels of risk—and would seek to address it immediately. Yet every day this is how many organizations approach the development and management of artificial intelligence (AI) and analytics in general.
Rising polarization is unlikely to disappear anytime soon, and it can have severe ramifications for businesses, whether they take a public stance or not. However, by taking a selective and strategic approach, CEOs can reduce the harm of polarization first within their own companies.