Planning for Change: CEO Transitions by MWWPR

PLANNING FOR CHANGE: CEO TRANSITIONS

Navigating a CEO transition is a critical time for any company—handled poorly, it can have dire effects on the company’s overall brand, culture, operations and, ultimately, the bottom line. Executed correctly, however, it can reshape a company’s reputation and catapult the brand into the limelight. CEO transitions are often challenging for a company, but how they are executed can have serious consequences for a brand, now more than ever before. © MWW GROUP, ALL RIGHTS RESERVED

PLANNING FOR CHANGE: CEO TRANSITIONS

"You’re expected to prove yourself from day one.” – JEFF IMMELT, CEO, GE

10 40

OF S&P 500 COMPANIES APPOINTED A NEW CEO IN 2013 1

OF NEW CEOS DEPART WITHIN 18 MONTHS OF THEIR APPOINTMENT 3

ONLY 22.9

23 64

OF S&P 500 COMPANIES FACING A CEO SUCCESSION HIRED AN OUTSIDER 2

DEPART WITHIN FOUR YEARS 3

OF SUCCESSION ANNOUNCEMENTS AMONG S&P 500 COMPANIES IN 2012 EXPLICITLY STATED THAT THE INCOMING CEO WAS IDENTIFIED THROUGH THE BOARD’S SUCCESSION PLANNING PROCESS 4

PLANNING FOR CHANGE: CEO TRANSITIONS

WE TRUST PEOPLE, NOT COMPANIES A CEO transition is the perfect opportunity to enhance a company’s overall relevance in the marketplace by focusing on its greatest available asset – the CEO. DUCTS & SERVICE PRO S

CEO REPUTATION

CUSTOMER

TALENT

& ENTS CL I

With a CEO transition comes the opportunity to craft a communications program that builds CEO eminence, creates a distinct voice and POV for the brand, and establishes trust among key audiences in order to assert relevance in the personal brand of the new CEO and chart a new path forward.

PRO

D U CT S & S E R V I C E S

PLANNING FOR CHANGE: CEO TRANSITIONS

KEEP CEO TOP OF MIND Leaders are judged by the company they keep, the team they build and their contributions beyond this quarter. Employ a “Company You Keep” philosophy, pursuing business venues and initiatives based on “who” is involved and the connectivity to executive platforms. How you define your peer set, the groups you choose for partnerships, the organizations you support, even the places where you choose to speak, all contribute to your reputation – and, ultimately, the company’s bottom line.

OF GLOBAL C-SUITE EXECUTIVES NAME REPUTATION RISK AS THE TOP STRATEGIC RISK 5

CEO REPUTATION INFLUENCES ALMOST ONE-THIRD OR

OF INVESTMENT DECISIONS 6

PLANNING FOR CHANGE: CEO TRANSITIONS

CULTIVATE THE RIGHT RELATIONSHIPS From clients and employees to Wall Street and the media, it’s important to facilitate the development of trust among key stakeholders to make a difference in the short- and long-term. A new leader must methodically explore the landscape, ask key questions, speak to representatives both inside and outside the organization, and keep communication lines open. A new CEO must seize this opportunity to cultivate ambassadors and build trust, which can pay huge dividends in the long-term.

ANALYSTS

CUSTOMERS POLICYMAKERS / REGULATORS

ACADEMICS & INFLUENCERS

CEO BRAND MEDIA ONLINE INFLUENCERS / BLOGOSPHERE

CURRENT / PROSPECTIVE EMPLOYEES

GENERAL PUBLIC

PLANNING FOR CHANGE: CEO TRANSITIONS

INFLUENCE THE INFLUENCERS An incoming CEO must establish personal and relevant connections with those audiences that have the greatest opportunity to influence behavior and engage others. Connect with the people who are the game-changers for your business, including industry experts, analysts, policymakers and government officials. If you don’t proactively tell your story, others will write it for you, so control the conversation from the get-go. Architecting the conversation is about knowing who is relevant, when, how and why… and if you’re not a part of the conversation, you’re just part of the noise.

80% OF THE CONVERSATION 8

PLANNING FOR CHANGE: CEO TRANSITIONS

DEVELOP CONTENT THAT MATTERS Engaging across multiple channels from the outset with scalable content immediately builds momentum and captures attention. Actively listen to key stakeholders—both online and off—to gain insights into brand perception, see how they engage, and find out who they turn to for information. Leaders must speak to as many people as possible to find out brand opinions and establish a shared vision. Then, with all of this information gathered, create and leverage company content in a way that is relevant to the market and reflective of an energized, focused CEO and leadership team ready to execute a strategic vision.

PLANNING FOR CHANGE: CEO TRANSITIONS

CAPITALIZE ON THE FIRST 100 DAYS The first 100 days of a CEO transition is a vital time; it is when first impressions of the new chief are created and trust in the leadership’s vision and ability is established. This is an opportunity for CEOs to create vision, strategy and expectations. This initial period can be the determining factor of a successful CEO transition, which builds substantial stature and goodwill that can accelerate growth for the brand, or it can result in a reputational deficit that can be a distraction and drag on your organization’s positive momentum. In many ways, a CEO transition strategy is comparable to the launch of a political campaign, where the CEO is a candidate running for office.

TO SUCCEED, THE CEO NEEDS TO FOCUS ON THE KEY ELEMENTS THAT MAKE UP ANY SUCCESSFUL LEADERSHIP TRANSITION:

IMPACTFUL AND RELEVANT PLATFORMS DIFFERENTIATING MESSAGES/POVS BENCHMARKING RELATIONSHIP BUILDING WITH KEY STAKEHOLDERS AND LEAD STEER MEDIA

PLANNING FOR CHANGE: CEO TRANSITIONS

THE 100-DAY PROCESS “One of the things we often miss in succession planning is that it should be gradual and thoughtful, with lots of sharing of information and knowledge and perspective, so that it's almost a non-event when it happens.”– ANNE M. MULCAHY FORMER CEO OF XEROX CORP The 100-day process is a multipronged approach to tackling the various phases of building out a CEO brand and communications program, including planning and strategy, the launch phase, the full program rollout, and sustaining impact. MWW’s Total Stakeholder Approach ensures a leadership transition that is smooth and effective, helping a CEO brand and company matter more to key stakeholders.

PLANNING FOR CHANGE: CEO TRANSITIONS In order to prepare for a smooth transition, it’s important that the CEO in his/her new role takes the time to build the right relationships and begins to cultivate engagement with key stakeholders, i.e., the board of directors, employees, analysts, media and other influencers. MWW’s three-step makes a difference in the primary stages of a CEO’s tenure; it’s a process that enables the CEO and his/her team to define a unified vision, setting the company up for success over the long haul.

STEP 1: STRATEGY & PLANNING (-60 – 0 DAYS) Set the stage: The two months leading up to a CEO transition are perhaps the most critical in the process. This is the time to work a CEO’s closest confidants – marketing & communications, legal, HR, the Board and your leadership team – to set expectations, develop a shared vision for the brand, cultivate internal and external ambassadors, and ultimately develop a comprehensive communications plan that will differentiate the CEO and company in the marketplace.

STEP 2: PROGRAM ROLLOUT (0 – 60 DAYS) Turn vision into action: Once a defined vision and compelling point of view have been established, it’s time to bring the CEO to market. Effectively put a stake in the ground and grab stakeholder attention through communications tactics such as speaking engagements, influencer and analyst relations, media meetings, social media, and more.

STEP 3: SUSTAIN MOMENTUM (61 – 100 DAYS) Amplify impact: The final phase sustains external momentum for the CEO to amplify his/her voice as the future of the brand. Communications about the company moving forward need to mirror the CEO’s plan and vision. Each phase has its own set of essential objectives, strategies and tactics to be executed. This roadmap will help your brand navigate this transition and set your company up for success.

PLANNING FOR CHANGE: CEO TRANSITIONS

A leadership transition that is smooth and effective can have an impact on your bottom line and strengthen your relationships with key stakeholders. With a strategic process in place, you not only reinforce the CEO’s longterm vision for the brand, but also set the company up for sustained growth and competitiveness.

PLANNING FOR CHANGE: CEO TRANSITIONS

SOURCES 1. 2013 CEO Transitions, Spencer Stuart 2. CEO Succession Practices: 2014 Edition 3. The Right Leader: Selecting Executives Who Fit, Wiley, 2009 4. CEO Succession Practices: 2013 Edition 5. Exploring Strategic Risk: A Global Survey, Deloitte and Forbes Insights 6. FTI Consulting

FOR MORE INFORMATION, PLEASE CONTACT: Carreen Winters

Executive Vice President 201.964.2410 | 646.336.4955 | cwinters@mww.com

Cecilia Coakley

Group Vice President 201.964.2395 | ccoakley@mww.com

MWW

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