The article on the Stanford Graduate School of Business web site asks a simple question: “Is Your CEO Irreplaceable?†Here’s the key paragraph.
“The market for top-flight talent is now so tight that nearly 100 directors of Fortune 250 companies estimate that fewer than four people — including those both inside and outside their company — would be capable of stepping into the CEO role today and running it at least as well as their current CEO, according to a survey by researchers at Stanford Graduate School of Business and the Rock Center for Corporate Governance at Stanford University.”
If you intend to stay in business, you will replace your CEO at some point. The real question is: “How can you increase the odds that your next CEO will do well.?†Part of the answer to that question is: “Leadership development.â€
Leadership development to provide a good CEO
The Stanford GSB article asks the question about filling the CEO role. If you don’t develop your own qualified candidate, you will have to depend on the market. You have to hope that there will be a candidate out there with the right mix of skills and experience. You have to hope that you can entice that candidate to come work for you. You have to hope that the transition will work out smoothly. That’s stringing a lot of “have to hopes†together. If you grow your own leaders, most of those “have to hopes†go away.
Leadership development and the pipeline bonus
If you grow your own leaders you don’t just grow competent CEO candidates. You can grow leaders at every level. You can develop that coveted commodity: bench strength.
Your leadership development program can grow competent and tested leaders. That way you don’t have to hope a qualified outsider will be there when you need a CEO.
