Choosing a CEO is an immensely important decision for any board of directors. The Chief Executive Officer will be the face and voice of your organization, so it’s crucial to find someone who has strong communication skills as well as an understanding of how to maximize profits.
New board members, in particular, may not have experience in this area. Indeed, it’s likely that even experienced board members have not previously hired a CEO, and if they have, the number will not be great. So what advice is there for board members when faced with the task of CEO selection?
In this article, we’ll discuss a couple of the essential considerations for boards presented with this challenge, outside of the normal remit of leadership skills and previous experience.
CEO succession is a significant undertaking for any board of directors. While many companies rely on the current CEO to manage the process of selecting their successor, although ideal, this is not always possible. An alternative, if viable, would be
for a former CEO to provide insight into what a successful appointment should look like andoffer advice on interviewing and vetting candidates. The reality is, however, that whoever bears this responsibility will be under extreme pressure to navigate the process well and make the right choice; from both shareholders, employees, and clients.
for a former CEO to provide insight into what a successful appointment should look like andoffer advice on interviewing and vetting candidates. The reality is, however, that whoever bears this responsibility will be under extreme pressure to navigate the process well and make the right choice; from both shareholders, employees, and clients.
When assessing the suitability of potential new CEO candidates for the role, these two guidelines are often overlooked but can be a valuable aid to board members when making such crucial and complex CEO decisions.
Discuss and agree criteria to choose the CEO
The new hire will be responsible for guiding the company through its next phase, so
it’s crucial to find someone who matches with them in terms of both vision and strategy.
It´s impossible for a board to make a successful evaluation of a candidate’s suitability without first having a comprehensive understanding of the company’s current situation, its strengths, and weaknesses. It is important, therefore, for the board of directors to reflect on the present challenges and discuss and agree on exactly what they are expecting their new CEO to accomplish and what their responsibilities will be once appointed.
Once there is an agreement on these fundamentals, it will be much simpler to ascertain what the selection criteria for a new CEO should be.
Culture
Company culture plays an important role when considering potential candidates
therefore selecting criteria such as leadership skillset/experience should not take
precedence overcultural fitment.
therefore selecting criteria such as leadership skillset/experience should not take
precedence overcultural fitment.
Any new head of an organization must be able to integrate well into the existing culture
if the board deems the current corporate culture to be a healthy one. The ability to own a company’s vision is vital to the role too. In this scenario, it may be beneficial to consider internal candidates that understand the culture and mesh well, while demonstrating the capacity to be able to lead the organization into the future by building on its existing foundations.
if the board deems the current corporate culture to be a healthy one. The ability to own a company’s vision is vital to the role too. In this scenario, it may be beneficial to consider internal candidates that understand the culture and mesh well, while demonstrating the capacity to be able to lead the organization into the future by building on its existing foundations.
If the expectation is for the incoming CEO to make significant cultural shifts in the organization, however, then selecting an external candidate from outside the organization may be recommended. Instigating and leading any major change within an organization is never an easy task, and even less so when it is attempted from within the limitations of the current cultural framework.
The right skill-set to guide the company through its present and expected future challenges is of course paramount to the success of any new CEO.Previous industry experience as well as the question of whether or not the candidate being considered has had previous experience in a CEO role, should all be key factors in the decision-making process.
Boards of directors that have little experience in C-suite selection may naturally assume that it is essential to hire a candidate with experience in the same role, in the same industry, with a proven track record in a company of a similar size.
While it’s not impossible, many s are ambitious in their sights and most often in search of new and bigger challenges. It is therefore critical to remember that the person ultimately chosen for the top job may not tick every box in the ideal selection criteria.
While it’s not impossible, many s are ambitious in their sights and most often in search of new and bigger challenges. It is therefore critical to remember that the person ultimately chosen for the top job may not tick every box in the ideal selection criteria.
A level of compromise may be required but that does not indicate a failure in the process or lead to an unsuccessful appointment.
To support companies in such a relevant and impactful decision as the election of a CEO, at Marble we provide the support they need in the search for the new leader and find the candidates that best fit the profile and needs they have.
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