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Promoting From Within: Onboarding Risks For Wal-Mart's Next CEO

Posted: 06/03/2013 9:07 am

As Anne Fisher reminded us in Fortune, 40 percent of new leaders fail in their first 18 months. Generally this is because they don't fit, fail to deliver or fail to adjust to a change down the road. The surprise is that this is also true for people getting promoted from within, as well as for people joining from the outside. While those promoted from within are less likely to clash with the culture of the company, there are still risks to be aware of that tie back to delivery and adjustment. Let's look at Wal-Mart:

The company is focusing on two internal candidates as possible replacement for their outgoing CEO. Doug McMillon, head of international, has spent his whole career at Wal-Mart. Bill Simon is a relative newcomer, having joined the firm as VP of professional services in 2006. At this point, Simon has converged into the culture and currently runs US stores. So either candidate should have relatively low fit risks and relatively high delivery and adjustment risks.

Three main onboarding risks:

Fit: Mismatch between personal preferences and the organization's BRAVE culture - Behaviors, Relationships, Attitudes, Values, Environment. With poor fit, the organization rejects the new member.

Delivery: Failure to deliver expected results, generally because of issues around organization alignment, role expectations, personal strengths or motivation, poor relationships, learning too slow or not building a high performing team.

Adjust: Failure to see or react to situational changes. Certainly, Bob McDonald had no fit issues when he became CEO of Procter & Gamble after 30+ years at the firm. But he was ousted after a couple of years because he and his team failed to deliver the expected results. Let this be a warning for newly promoted Sallie Mae CEO, John Remondi and the soon-to-be-named new CEO at Wal-Mart.

No matter what company or industry you're looking at, the basics of Executive Onboarding always apply: get a head start, manage the message and build the team. What's different for those promoted from within is the nature of their head start, the context for their message and the conditions and context for team building. Those promoted from within can't control the context, can't make a clean break from the past and get no honeymoon. This leads to three indicated actions for those promoted from within:

  1. Prepare in advance. Work to understand the context and complexity of the new situation. Get yourself ready and exert whatever influence you can to shape your new role and set up success - as far in advance as possible. This is about managing the prelude, much as Ajay Banga did so well at MasterCard.
  2. Take control of your own transition. Leadership is made up of a series of moments of impact. Taking charge as CEO is one of those moments. The learning for Brian Krzanich at Intel is applicable here as well. The core of this is managing your message and communication cascade, clarifying what has changed and what has not changed.
  3. Accelerate team progress after the start. This is where those promoted from within have an advantage. You already know the organization and team. There's no excuse for you and your new team not to get a running start and leverage positive momentum to accelerate key strategic, operational and organizational processes. Just remember to be ready to adjust as needed, much as Mike Duke adjusted at - wait for it - Wal-Mart.

This is a good example of step 1 of The New Leader's Playbook: Position Yourself for Success
There are several components of this including positioning yourself for a leadership role, selling before you buy, mapping and avoiding the most common land mines, uncovering hidden risks in the organization, role, and fit, and choosing the right approach for your transition type. (Including an interim role.)

Click here to read about each step in the playbook

Click here for YouTube videos highlighting each step

This article originally appeared on Forbes.com

The New Leader's Playbook includes the 10 steps that executive onboarding group PrimeGenesis uses to help new leaders and their teams get done in 100-days what would normally take six to twelve months. George Bradt is PrimeGenesis' managing director, and co-author of The New Leader's 100-Day Action Plan (Wiley, 3rd edition 2011) and the freemium iPad app New Leader Smart Tools. Follow him at @georgebradt or on YouTube.

 

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