Organisational Change Management Volume 2

How to handle a new senior manager (CEO) from outside the organisation?

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Introduction

. Generally there are three questions employees need to consider

i) how worried should I be?

ii) what will happen to me if I do get pushed out?

iii) if I stay on, what should I do to maximize the chance of prospering with my new boss?

. Research has shown that incumbent executives are the most vulnerable when

- an outsider is appointed and

- the organisation has experienced a year of poor performance

. Compared with an internal appointment, turnover of staff was only marginally higher if an outsider was appointed as CEO

Comments on survival strategies

. Most new CEOs make people decisions quickly and these are based more on instinct rather than on what they are told. Thus first impressions count

. Show good will - rather than wait and see what the new CEO wants, it is better to demonstrate your willingness to be part of the new team, ie

"...if you decide you want to stay, let the CEO to know, proactively and without being sycophantic, that you want to be on the team, and follow up with actions that demonstrate your willingness to go along with the program. This is particularly important when the new leader has won an internal ' horse race' and you were previously associative with a different candidate..."

Kevin Coyne et al, 2007

. Leave your baggage at the door - don't talk about

i) your compensation

ii) your long-term plans for the organisations

iii) your long-term difficulties with other executives

In other words,

"...the CEO will not appreciate you pushing your own agenda ahead of his, in any form..."

Kevin Coyne et al, 2007

Furthermore, make sure that your spouse or partner is positive and polite to the new CEO, as any unguarded comments can be assumed to be an accurate reflection of your own views

. Study the new CEO's working style - most CEOs want their direct reports to be sensitive to their working style and then match it. For example,

- Find out how you are able to disagree with your boss. Is disagreement allowed in public or only in private? Are you allowed to continually put your argument or must you just accept that the CEO's decision is final? What is the CEO's reaction to your staff and colleagues knowing that you have disagreed? What ethical or behavioural areas are potentials for conflict with the CEO?

- What kind of facts (stories from the front line or statistics) will help change his/her mind?

. Understand the CEO's agenda -

"...senior managers could be substantially more effective if they simply took a little time to put themselves in the newcomer's shoes and make an effort to appreciate his or her agenda. First, consider the pressure your new leader is under, especially when it comes to making a strong start......a new chief executive's fate depends heavily on the company's stock performance during his or her first year of tenure......75 percent of CEOs whose companies' share prices rose during the first 12 months were still in their jobs two years later, but 83 percent of those whose firms' shares fell were gone by that time..."

Kevin Coyne et al, 2007

Thus your new boss will be looking for constructive suggestions about actions that can be taken very quickly. Furthermore, executives need to confirm their understanding of the new agenda with the new boss.

. Present a realistic and honest game plan - be prepared for honest discussion with your boss on your area of responsibility and plans for the future. Present the situation as clearly as possible; don't hide anything. It is about developing trust with your new CEO.

. Be on your "A" game - it is important to help your new CEO show positive operating results as quickly as possible. It is critical to demonstrate that you are active and competent with important projects moving forward; you are a team player who focuses on solutions rather than problems, and follow through on what you say you will do; you need to be politically astute and work on successful projects that allow extensive interaction with the new CEO

. Offer objective options - need to show a willingness and ability to constructively engage in discussions on past and future budgetary options so that the CEO can translate the new vision into tangible decisions

(sources: Fiona Cameron, 2002; Andrew Cornell, 2003; HRmonthly, 2002; Jan Reeves, 2001; Fiona Buffini, 2004; Boris Groyberg, et al, 2004; Harry Onsman, 2004c; James Hall, 2004e; Boris Groysberg et al, 2006; Linda Hill, 2007; Katherine Nicholas, 2007; Jack Welch et al, 2005; Rose-Anne Manns, 2007; Betsy Morris, 2007; James Hall, 2004e; John Davidson; Harry Onsman, 2004d; Sue Mitchell, 2006; Harvard Business Updates, 2001; AFR, 2002; Manfred Kets de Vries, Kevin Coyne et al, 2007; Fiona Smith, 2009r)