For most boards, succession planning for the CEO position is an ongoing concern. Promoting from within can help ensure a culture fit and send a good message about the company’s willingness to invest in its people. But infrequent, cursory, or purely social interactions between directors and prospective internal candidates do not allow for adequate assessment of candidates.
Directors Can Mentor Prospective Internal CEO Candidates
Promoting more meaningful and frequent engagements between directors and rising stars can help identify and develop the skills required of a future CEO. Mentorship relationships can provide this level of engagement. Note that the focus of this mentor-mentee relationship should not be to solve real, on-the-job problems—that would create a “supervisor-type” relationship.
Instead, mentors should focus primarily on developing the soft skills of their mentees, so they will be better equipped to deal with the problems they may face as CEO. There are three critical dimensions to these skills:
- Self-awareness
Mentees should be helped to understand their motivations, their reactions to others, and how to regulate their emotions. If they understand their strengths and weaknesses, the mentor can provide context for how best to work with them in the business.
- Situational Awareness
CEOs need to quickly and accurately interpret a situation and react accordingly. Mentors can once again provide context to situations their mentees may not have access to. They can help mentees build a repertoire of tools for analyzing such situations. Mentors can also help counter inherent cognitive biases and blind spots the prospective candidates may not be aware of.
- Social Awareness
By helping their mentees understand their own impact on a situation and others’ reactions, mentors can help meld their mentee’s leadership style to strategically fit the organization. This can significantly improve the speed of impact of a new CEO, who might otherwise have to spend time experimenting with different leadership styles.
How Do You Ensure and Measure Success?
Mentorship relationships involving directors and internal talent require thoughtful pairing. They must also have buy-in from the whole board, including the incumbent CEO. Measurement of success should be qualitative rather than quantitative. Over time, mentors should experience a shift in the relationship from mentor and mentee to a peer relationship. There should come a point where the mentee begins to contribute to and expand the mentor’s experience and view of the business. In addition, the mentee should begin “cascading” mentorship downward throughout the organization.
What Happens After the Candidate Is Appointed?
Mentorship does not have to end when the mentee becomes the CEO. CEOs will face unique situations that they still may not be equipped to handle, despite all their preparation. In addition, it’s not always feasible for CEOs to absent themselves to attend executive education courses and professional development classes.
It’s clear that CEOs on the job can benefit immeasurably from a mentor who has “been there, done that.” However, trust and confidentiality are critical—it is not appropriate for a CEO to expose their gaps and deficiencies to board members at this point. They need access to someone they can speak to freely, who is neither a stakeholder nor a “paymaster.”
It could be that the CEO has access to appropriate mentors outside the company, but not everyone does. Some candidates may not have the networks that traditionally create such relationships. In these cases, the board chair could introduce a suitable external mentor, or a high-level consultancy can be briefed to provide introductions to prospective mentors not acquainted with the board. In their two-year study on how new CEOs access seasoned counsel and feedback, Suzanne de Janasz and Maury Peiperl found the latter an increasingly common trend.
Their study found CEO mentors to be 10 to 15 years ahead of their mentees; the mentors were typically retired CEOs sitting on multiple boards. The mentor-mentee relationships were most effective when there were clear rules of engagement, such as fixed but infrequent meetings with formal agendas driven by the mentees.
Interestingly, the study found that the preferred approach to development was through storytelling. Storytelling provides psychological safety for the mentee—it’s not about “them” and allows them to theorize their actions and potential consequences. In contrast to mentorship at lower ranks, where preparation for sessions is a large part of the mentee’s development, CEO development occurs in situ.
For the researchers, an unexpected outcome of the study was the extent to which mentoring by storytelling provided a psychological boostto new CEOs. Respondents reported that hearing how others in similar positions had overcome adversity and recovered from mistakes left them feeling like they could achieve whatever they put their mind to.
Mentorship leading up to and during a new CEO’s appointment can play a huge role in their success in the position. However, the criteria for matching a prospective and incumbent CEO with a mentor are different. Companies must understand this and should at least consider paying to have their CEO mentored outside the organization.