Succession and peril

A failed leadership transition can destroy a brand. Take plenty of time, focus on the company, and beware of politics and interpersonal conflict.

Several years ago I visited the church I grew up in and had an unexpected experience that left a lasting impression on me. As I approached the door, I noticed leaves had collected around the corners of the entrance, as though it was not used often. As people would enter the church, the doors would push the leaves into the corner. As you walked through the door, the carpets in the foyer were worn and dirty.

This was surprising as this was the “new” sanctuary, built just prior to me moving away. It was built at a time when the church was at its peak, enjoying high attendance and an abundance of programs. As I walked through the various hallways, I noticed rooms where I’d had class or that housed a vibrant program in the decades prior, now being used as storage. Corridors that previously were packed with people going from one area of the church to another were completely dark.

The success of this church was attributed to what many successful organizations are built on – a great and singular leader. The senior pastor had been at the church for more than 30 years and had built it from a one-building institution with less than 50 members into a multi-building campus that spanned a city block and had thousands of members. During the 14 years I lived away, my mom would fill me in on the stories of the church, all revolving around the difficulties of that senior pastor retiring.

The stories sounded all too familiar to what is happening in many AEC firms today – difficulty in transitioning from a founder or long-time leader. The church waited too late to prepare for the exit of this powerful pastor and, when the day arrived, the elders could not agree on how to fill his shoes. The rest is history, a history of decline.

During that walk, the “brand” of that church changed dramatically. The reason this experience was so powerful to me is because I was also preparing for a similar transition in my company. I had just moved back to my hometown of Fayetteville to join Mark Zweig in re-building ZweigWhite, now Zweig Group, and to be his eventual successor. It was a dream job for me, but as I walked in the sanctuary and saw that three quarters of the seats were empty, the gravity of my own situation hit me.

I realized that even though we’d helped hundreds of companies prepare for ownership and leadership transitions, we were not immune from failure, and even if we had a successful transition, that it would not be easy. Keeping the best of the heritage of the Zweig brand while preparing the company and the market for the next generation of the company became even more important. Here are some of the best pieces of advice I can offer to someone who might be facing a transition:

  • Start early. Internal transitions need five to 10 years to execute. Start with a strategic plan that clearly spells out the company’s vision. Consider the changes that need to be made in various areas of the company to prepare for different leadership. Most firms that have powerful founders or leaders that created significant growth must consider that evolution in the company will happen with the transition. A lot of time may be required to prepare the people, systems, and processes.
  • Focus on the business. You must focus on keeping the business strong and the momentum going. Going back to my childhood church, the elders over-focused on finding a leader that solved some of the perceived personality flaws of the outgoing pastor. As a result, they brought someone in who was a complete opposite. You must focus on someone who can fuse the past and the future together and can lead the change that is inevitable in transitions. Politics and interpersonal conflict are certain to derail any good leadership transition. Focus on keeping the people and business strong.
  • Choose internal, if possible. Internal candidates are almost always more successful for a variety of reasons. First of all, they have the time invested for a five- to 10-year plan. Also, internal candidates are more accepted by the culture, as this has enhanced importance in the AEC industry. We don’t always have the right person internally for the job, but if we have a long-term and intentional plan, we can hire the right one and get them integrated.

Leadership succession is important to all firms, but especially those with strong brands. There are many AEC firms that plug along, rising and falling with the markets. And then there are those firms that have aggressive and ambitious leaders that create extraordinary growth. While outsized success is exciting and does incredible things for the people and the community, it comes with a price.

The hard work it takes to create that success must keep going. The organization must be able to evolve and adjust to the changing market and to new leadership. The staff relies on the continuance of company culture and the clients rely on the continuance and promise of the company’s brand. We have seen many firms that enjoy extraordinary success, only to have it diminished by a failed leadership transition, thus diminishing the brand. If your intention is to internally transition your firm, start early, focus on the person, and keep the brand in sharp focus. Don’t end up like my childhood church.

Zweig Group has a new event designed to help with leadership transition and succession. Click here to learn more about the Successful Successor Seminar.

Chad Clinehens is Zweig Group’s president and CEO. Contact him at cclinehens@zweiggroup.com.

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Posted in Articles, Ownership Transition | July 9th, 2018 by