“So many firms in the AEC business are making transitions right now. Aging boomers in their 60s and 70s are selling down, and their chosen successors are taking the reins.”
So many firms in the AEC business are making transitions right now. Aging boomers in their 60s and 70s are selling down, and their chosen successors (we hope they are choosing successors!) are taking the reins.
Unfortunately, too often, it doesn’t go as smoothly as it should. There are many reasons for this. Maybe the leaders who are stepping down aren’t doing everything they should to optimize the firm’s chances of success? Maybe the successors, too, are partly to blame? Here are my thoughts:
- Promoting from within is always best! It’s always best if one’s successor comes from inside the organization. He or she knows the cast of characters and the firm’s culture, and is bound to be more easily accepted by the rest of the people in the company. That said, it isn’t always possible. In those cases, the newly hired successor will have to prove him or herself before assuming the leader’s role. Not doing so could greatly increase the chances of a failed transition!
- Real transition takes time. Especially in cases where an outsider is hired to succeed the outgoing leader, the process cannot happen overnight. There’s no way to shortcut it. In essence, the outsider has to become an insider. Rotation through various roles in the firm or the work group is certainly one of the best ways to familiarize the new leader with everyone/everything, and also to build credibility and prove themselves to everyone else. Skipping this process and rushing transition greatly increases the chances of failure.
- The old leader has to let the new leader do his or her job. This can be very difficult (for the old leader) but it’s essential. So many old leaders will not part with any decision-making authority yet want to act as if a transition has been made just by giving a new title to someone. The transition has to be real or everyone will quickly figure out it’s “business as usual” and that nothing has really changed. This quickly cuts the legs out from under the new leader. We’ve seen this situation too many times over the years and it always makes me sad for everyone involved.
- The old leader has to support the new leader. There will always be critics or those inside the organization who resist change. The old leader could easily adopt that posture himself. But it’s like shooting yourself in the foot if you are the old leader who wanted to have a transition in the first place! Outgoing leaders have to encourage everyone to follow the new leader. That means the old leader isn’t a critic on the sidelines fanning the flames of, “It isn’t like it used to be here.” Of course it isn’t like it used to be. We live in a different age and time and have different people. Everything is in a constant state of change. Old leaders need to get on board with this idea, and while offering counsel to the new leaders, should also support them both publicly and in private.
- The new leader has to support the old leader. Just as the old leader has to support the new leader, the new leader, too, has an obligation to support the old one. Unfortunately, it isn’t human nature. Being too anxious to quickly distance themselves from the practices of the past, or to trash past decisions publicly can create needless friction or ill-will between the outgoing leader and the new one. Many new leaders tend to do this as a way of establishing themselves but it can harm their acceptance, especially if there’s a contingent still there whose loyalties were to the old leader. Everyone needs to realize that their needs are best met by working closely as a team.
- The old leader has to keep their ego in check. Some old leaders are so used to being the boss and it’s very hard for them to give up anything because of their egos. The company name may change. The reserved parking spot may go away. The old leader’s front office may turn into a back office. Their company car may go away. They may not be the first person who is informed of something unusually good or bad that has happened. That’s the way it is. It’s a price of succession that has to be understood. Old leaders, check your egos at the door!
- The old leader has to step aside. Ultimately, giving the new leader a real chance to succeed requires the old leader to get out of their way and let them do their jobs. Entrepreneurs get this idea. They are all about investment, growth, and cashing in on their sacrifices at the end – and they know they have to get out for that to happen. Small business people, however – of which the AEC industry has in much larger numbers than entrepreneurial leaders – don’t get this idea. They are control freaks and used to operating their businesses for their own benefit. They have a very hard time letting go. But you have to. Your other choice is to work ‘til you drop and let everyone else pick up the pieces. And that is usually a painful process that results in a lot of lost firm value and too many good people getting hurt.
Mark Zweig is Zweig Group’s chairman and founder. Contact him at firstname.lastname@example.org.Subscribe to The Zweig Letter for free. Click here to learn more about Zweig Group's ownership transition services.