At some point many founder CEOs think about stepping back and letting their team run the business without them. But how do you do it?
Follow these ten steps to create a successful transition that enables founder CEOs to relinquish control, relax and reap the benefits.
1. Develop team potential
Getting the ‘right’ people on your team is something that can take quite a while to achieve. For the founder CEO that has her/his eyes set on being able to step back from the business in the future, establishing a team that has potential to develop is critical.
2. Create a Vision
Founder CEOs usually have a vision for the business that comes from within themselves, but over time that can become vague or disjointed especially for team members. That’s why it can be very productive to involve the team in clarifying the vision for the business. The vision identifies a destination that everyone can buy into, bringing the whole team together and giving them common ground.
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3. Define Values
Every organisation embodies values that influence actions taken by everyone in the business. Quite often these values have been unconsciously developed and accepted over time, and usually go unrecognised in day-to-day work. By involving the team to establish a core set of underlying values that apply across the business it’s possible to create a framework to guide interactions both within the team and with external parties such as customers and suppliers.
4. Establish accountability
Accountability is possible when people understand what they are responsible for, and you have processes in place to recognise the achievement of outcomes. This is often underpinned by creating effective Position Descriptions and identifying relevant KPIs (Key Performance Indicators).
5. Create a transition plan
Now is the time to develop a plan for the transition of the CEO-to-be to replace the founder CEO. By this stage you have a solid foundation in place that includes having the right team for the business and have expectations and guidelines in place through the Vision and company Values that have been endorsed by the team.
6. Make it clear to the team
Once you have a transition plan you can confidently communicate that to the team. It’s important that everyone understands the reasons why things will be changing, what will actually change, and how that will affect them in their role. Nothing undermines employee engagement more than fear of the unknown.
7. Establish a development program
Inherent in the whole CEO transition process is that other roles within the business will also be impacted. To ensure employee engagement is maximised and performance maintained it is advisable to establish a development program for all employees.
8. Get out of the way
The founder CEO has now set the scene for their own departure. A critical component of the process is for the founder CEO to actually take their hands off the wheel. It’s now time for the team to take control and work within the frameworks and expectations that have been created.
9. Support the CEO-to-be
Whilst the founder CEO is now in the passenger seat, they can still actively support the CEO-to-be as they grow into CEO role by having ‘backstage’ discussions with them and by being available as a sounding board during the initial time they have stepped away from the role.
10. Help chart the future
At this stage it’s worth noting the founding CEO has not completely severed their ties to the business (unless that is their objective!). They can still have a valuable role to play in using their time and energy to investigate new opportunities or strategic options and remain in an adviser role to the new CEO.