How Not to Lose the Top Job

(MoneyWatch) 

The Idea in Brief

Your CEO said, "You're the heir," so your succession to the C-suite seems assured. Don't start ordering office furniture just yet: Many "future CEOs" never get the position. That's because on the road to the top job, they mismanage relationships with stakeholders who influence the final selection. These missteps can knock you out of contention, says Goldsmith.

To strengthen your candidacy, actively secure the support of six stakeholders:

• The current CEO


• Your peers


• Your direct reports


• Key customers



• Analysts and shareholders


• The board

For example, address any weaknesses your CEO has identified; ask peers for suggestions on how you can be a great team player--then take their advice; and use 360-degree feedback from employees to strengthen the leadership skills that need improvement.

The Idea in Practice

Goldsmith offers these recommendations for gaining support from your stakeholders:

The Current CEO

If the current chief doesn't like you or is having second thoughts about leaving, you probably won't get promoted. To secure his support:

• Project your readiness to be CEO (for example, by effectively managing your team's performance). But don't act like you already have the top job; he'll see you as cocky.


• Never talk about him behind his back.

Your Peers

You'll need your peers' commitment for the company to prosper under your leadership. To win that commitment:

• Cultivate personal relationships with those you want to stay at the company, by finding out what's important to them.
• Never make destructive comments about peers, even if they're badmouthing you to jockey for the top job themselves.

Your Direct Reports

Feedback about your leadership from direct reports may have a strong impact on the current CEO's perceptions of your ability to lead the company. To ensure positive feedback from employees:

• Identify opportunities for improvement in 360-degree feedback, then follow up with employees to ensure progress.


• Never criticize other stakeholders in front of your employees; they'll wonder what you say about them behind
  their backs.

Key Customers

Customers with close relationships with the current CEO or board members can veto you. To win their support:

• Ask your CEO to identify major customer relationships involving high-level executives. Get to know these people immediately.
• If you make decisions (such as raising prices) that anger key customers but are required for the company's survival, take the time to explain the rationale to them.

Analysts and Shareholders

Analysts and activist shareholders can sway a board on CEO selection. To cultivate their support:

• Provide honest, even conservative, projections of your unit's performance. If you think actual performance will fall short, issue a revision immediately.


• Build personal bonds with individual shareholders who own a large percentage of your company's stock and address their concerns.

The Board

The final vote on CEO selection is made by the board. To win directors' votes:

• Ask the current CEO if there are areas where board members think you need to improve. Work with the CEO to help change this perception if needed.


• Find out what the board wants in the new CEO--a change agent, someone who'll execute the current strategy, or something in between. Then ensure that your strategic vision meets the board's expectations--without undermining the current CEO's vision.

Further Reading

Articles

So You Want to Be CEO

HBR Article Collection

November 2007

You've got your eye on the top job, and you're certain that's where you belong. But do you know what to do to get there--and succeed? You'll be up against some sobering new realities. For example, the rules of career advancement have changed. Lifetime tenures inside a single company have become virtually extinct. Career ladders can crumble instantly after an acquisition or restructuring. And even among those who make it to the corner suite, many don't last long. You'll need a solid battle plan for ascending to the CEO spot and succeeding there. This HBR Article Collection offers ideas. A preview: If you've been climbing the ladder within your current organization, augment your insider's perspective with an outsider's valuable objectivity by networking with people beyond your company. Develop a track record of increasing P&L responsibility. And don't forget to master being political--without seeming political.

• Purchase the full-length Harvard Business Review article here.
• Visit Harvard Business Online.
• See more on Strategy and Execution at Harvard Business Online.

Copyright (c) 2008 Harvard Business School Publishing Corporation. All rights reserved.