The costly truth about executive transition failure

It’s a nightmare of Titanic proportions. You’ve invested in recruiting a new member of the executive team. The transition appears smooth at first and your new hire is confident. Full steam ahead!

Then a few cracks start to appear. Other executives are leaving. Key clients fall away, employee engagement drops, and there’s a growing lack of trust. Employee morale and productivity are at an all-time low due to communication issues and failure to look beneath surface level at challenges.

Meanwhile, your new executive is floundering. Their distress flares are released too late. Instead of hitting the ground running, they’ve hit an iceberg, with a sickening crunch.

The good news is that, despite leadership transition failure being common and costly to organisations and individuals, strategies exist for steering far clear of this scenario. Plus, there are recovery actions you can take to navigate back on course if you find yourself in difficult waters.

Appointment costs for a leadership executive average at 2-3 times their remuneration package. But did you know that?transition failure generally occurs within the first 18 months??And that it has overall estimated costs of 10 times the executive’s annual salary according to the ‘Harvard Business Review’ 2017? This includes replacement and lost opportunity costs. Ouch!

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We expand on the specific costs of poor transitions in our latest blog?(available on our website here) but at high level the most significant implications to organisations that we see are:

Productivity dips

?Dips in individual and team productivity as the new executive gets up to speed, can lead to a halt in progress against strategic goals. Not to mention reduced efficiency across the organisation.

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Opportunity costs

Poor leadership transition diverts resources and attention away from other important initiatives. This can result in reduced organisational growth, a strategic slump, or missed client opportunities.

The human toll

?Equally importantly, troubled transitions take a significant toll on stress levels and self-confidence, leading to burnout for your executive. A struggling leader may also display low trust in their team, inducing the same in return and creating a devastating impact on culture.

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Reputational and legal risks

Internal and external stakeholders are at risk of disconnecting when a new leader takes over. Failure to engage with stakeholders can lead to weakened relationships, negative perceptions and lost business.

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So, how can you flip the script and have peace of mind that your new executive has the support they need for success? Quite simply…pay attention! And?prepare.

Make sure you are checking in frequently and using a range of strategies (feedback gathering, performance monitoring, buddy structures and HR check ins for a start!). Plan to support with strategies such as transition coaching for senior hires and have measures in place to spot early distress signals. Investing in a well-structured onboarding and transition process pays dividends and sets your new executive up for a brilliant future with your organisation.

Read more detail on?our blog here.??If you’d like to have an informal chat about how your organisations handles senior level transitions, reach out via?DM or book a 30 minute?call with me?to discuss.