Power, Influence, and CEO Succession

How the board, the incumbent, and the new leader can ensure a successful transfer of authority

by

Dan Ciampa

and

Adam Bryant

by

Dan Ciampa

and

Adam Bryant

From the Magazine (July–August 2024) · Long read

Michel de Broin

01

Power, Influence, and CEO Succession

02

How CEOs Build Confidence in Their Leadership

03

The Vital Role of the Outgoing CEO

Summary.

When a CEO transition fails, it’s often because the incoming leader isn’t skilled at managing the power dynamics. They’re complex because the key players—the board, the outgoing CEO, and the new one—have different agendas. Designated successors need to understand those dynamics and how best to influence key stakeholders. The authors present four approaches: assertive persuasion, incentives and disincentives, common vision, and openness and involvement. To convince others that they’re ready to take charge, successors must learn how and when to apply them, consider the culture, secure the right allies, and act humbly. Once they take the helm, two other tasks become paramount: winning board support and clarifying and conveying a vision.

Idea in Brief

The Problem

Too many CEO successions fail. Sometimes the board mismanages them; sometimes the incumbent CEO is too reluctant to let go. But often the cause is the new leader’s lack of skill at influencing people at the top of the organization and at recognizing the nuances of power.

The Solution

Particularly when the incoming and outgoing CEOs overlap, the designated successor must be acutely aware of political forces and adept at wielding power wisely.

The Upshot

CEOs’ successors should understand effective approaches to influencing others and what contexts to apply them in. They must learn more about key audiences, clearly communicate a vision, win allies, manage resistance, develop strong relationships with the board, and stay humble.

Of all the decisions that a company’s board of directors makes, choosing the next CEO is arguably the most crucial. A failed CEO succession can disrupt employees’ work, cause senior talent to jump ship, damage the company’s reputation, erase enormous value, and ruin the careers and legacies of the outgoing CEO, the board, and the designated successor.

A version of this article appeared in the July–August 2024 issue of Harvard Business Review.