The appointment of a new leader is a defining moment for an organisation. Leaders find transitions into new roles the most challenging times in their professional lives, when they either build credibility and create momentum or stumble and sow doubts about their effectiveness. Much consideration has therefore been given to how leaders should take charge in their early days. But far too little attention has been paid to how the organisation should set them up for success as they enter their new roles.
It’s easy to see why. In making leadership appointments, companies invest most of their time, energy and attention in choosing the right person for the job. Only secondarily (if at all) do decision-makers consider what message the appointment will send (or should send) to the organisation and how it will affect those passed over and those who must now work with the new boss. But failure to announce appointments in the right way can undo all the work that went into the selection and hobble even the strongest leader from the start.
Responsibility for making appointments in the right way rests with the leader who made the selection, his human resources partner, and the communications, investor relations and legal professionals who advise them. This “appointment team” must devise good answers to four fundamental questions: (1) What message is this appointment meant to convey? (2) Why is this person the right one for the job? (3) Which members of the organisation need to be informed? (4) What should they be told and when? The first two questions are linked, and so are the second two, so we consider them in pairs.
Message and the messenger
A clear explanation of why an appointment was made and why the chosen person is right for the job will go a long way toward countering doubts or conspiracy theories and setting the new leader up for success. The goal isn’t necessarily to keep things on an even keel and make everyone happy. When an organisation wants to initiate a turnaround or pick up the pace in executing the current strategy, a surprising appointment can create an appropriate sense of urgency and thrust things forward.
To ensure that the intended signals are sent, senior leaders must strike the right balance between being clear about what the new executive has been appointed to do and leaving him flexibility to do it. Often what needs to be done is not obvious. Sometimes valid disagreements must be worked out after an appointment is made.
Generally speaking, people will need to know more about the qualifications of an external hire than of an internal one. In particular, they should be told why seemingly unrelated experience from another industry may apply in their organisation — why, for example, someone from the financial services industry will be able to lead a pharmaceutical company through the challenges presented by major regulatory changes.
But when a surprising selection is made from within the organisation, it’s important to remember that people think they already know the candidate — that is, they think they know what disqualifies him for the position. (If it were otherwise, the choice wouldn’t be a surprise.) One caveat: Using a surprising appointment to focus the organisation on the need for change works only if that need is viewed as legitimate. Justifying an unexpected selection by saying a turnaround is required when everyone knows it’s really a political appointment of a business-as-usual successor is a sure formula for failure.
Who should know what, when?
The planning for every major appointment must take into consideration the expectations and current state of knowledge of three distinct audiences: the leader’s new unit, other employees in the company and external stakeholders.
Everyone should be told the strategic rationale for the appointment and the appointee’s qualifications. Beyond that, each group needs something a little different: Those passed over should be informed why they were not selected and what kind of future they have in the organisation. Direct reports and other subordinates will want to know if this appointment signals a change for them.
Peers and other colleagues may wonder if they should expect to work with the appointee in a different way. External audiences should understand how the appointment aligns with the strategy and what the new leader is going to do to create business value.
In an ideal world, no one on the new leader’s team would be surprised by the formal announcement. Expectations would have been shaped for months or even years, as part of a robust succession and employee development programme.
In that world, everyone would already know of a serious situation that required a strategic or operational shift — and of the heir apparent’s qualifications. Would-be contenders would have long since tempered their aspirations and set their sights on opportunities for which they were better suited.
In a more realistic world, employees would at least have heard the rationale before any public announcement was made. Direct reports would get a sense of the changes in the offing; peers and other colleagues could anticipate how they might work with the new person. Individual conversations could reassure valuable contenders that their talents were appreciated and that they remained on track for advancement.
But in publicly held companies, appointments that have the potential to affect the stock price must by law be announced both inside and outside the company as soon as the formal decision is reached. This can be tricky when the decision comes during a crisis or as a prelude to a strategic shift about which your employees should be told far more than your competitors. Because news of a senior appointment travels fast, leaders have very little time to shape the process.
In such a case, internal memos and external press releases are typically launched simultaneously on the day of the appointment to provide the high-level rationale. In a well-designed announcement process, further information would be available internally through briefing papers or video and externally through media materials and interviews.
These could be tailored to the needs of individual constituencies. The key is to be speedy and thorough. Nothing signals an organisation’s priorities more vividly than how quickly (or slowly) a particular group or individual is included in the process.
In the critical days following an appointment, senior leaders must continue to communicate the rationale for the appointment and signal their support in words and deeds. That support must be consistent, enthusiastic, credible and authentic. Too much is at stake to neglect the fundamentals of making appointments right. When you’ve taken so much care to select someone, make sure you give that person a good start.
Suzanne de Janasz is a professor of leadership and organization development at IMD in Lausanne, Switzerland. Kees van der Graaf, formerly the head of Unilever's European business, is a non-executive director of Carlsberg, Ben & Jerry's and several other companies. Michael Watkins is a co-founder and the chairman of Genesis Advisers and a professor of leadership and organizational change at IMD.
© 2013 Harvard Business School Publishing Corp
Senior leaders must strike the right balance between being clear about what the new executive has been appointed to do and leaving him flexibility to do it.