Whatever sector you work in, having a good Chief Executive Officer is crucial to the development of your business. They are in charge of making the day-to-day decisions in the company and ensure you achieve your mission.
Research shows that the actions of the CEO add up to around 45% of a company’s performance. This is why it is so important to have the best CEO for your organisation. We’ve put together seven steps to take to ensure you make the right decision:
- Plan Ahead
Think of hiring a new CEO as an ongoing process rather than a one-time event. Even if your current CEO is perfect and looks set to continue in the role for many years, you should still have a contingency plan in place.
It may be difficult to raise this issue to Board members but it is worth doing. Your contingency plan should involve a suitable pool of candidates and an ideal successor. This may involve internal or external candidates.
Planning in advance will also give you the opportunity to develop talent within the organisation. As with most parts of business, research is key. This takes time and adequate resources.
- Create A Strong Succession Planning Team
One crucial step in hiring a new CEO is making sure the right people are at the head of the project. You might use an executive search firm to support the process.
Creating a strong team with different perspectives will allow you to pick the best candidate. It will allow you to see past personal biases and make the decision that matches the trajectory of the company.
In particular, your HR department should be at the centre of succession planning. They will understand the roles and structure of the organisation which will help you to develop an effective plan. The Chairman should also play an important role in evaluating any decisions.
- Involve The Previous CEO
If possible, get the previous CEO involved in the hiring process. This isn’t always feasible if they are leaving on bad terms. However, in many cases, they should be more than happy to support the company.
If the outgoing CEO is simply moving onto another company or retiring, they will be a useful voice in the process. They will have a better understanding of the role than anyone else.
Even if they have not been completely successful, listening to their perspective will give insight into how to move forward. It may help to outline which strengths are needed and which are less important.
- Establish Your Expectations
Even in the same sector, no two Boards are the same. Remember there is no such thing as a ‘perfect’ CEO, only the right CEO for your organisation.
For this reason, it is important to work out what you want to achieve in future. Your current CEO might have done a good job with the current market, but this is an exciting opportunity to make changes to how things are done.
- Keep An Open Mind
Keeping an open mind is crucial throughout the search process. As we’ve said, it’s important to plan in advance, but this doesn’t mean setting everything in stone. Things change and you should reassess your thought process at every stage.
Do not get too caught up on a single executive. Someone with an outstanding personality may catch your attention early on but make sure to stay measured. Of course, personality is important, but it shouldn’t be your only metric. You need a balance of personality, skills and experience to get the job done.
- Approach The Candidates In The Right Way
When approaching the candidates, make sure to outline why they would be a good fit for the position. You know how exciting your proposition is but they may not and so it’s important to communicate.
From the moment of contact, your research should be clear. Include references to their previous work and make it obvious why you can see them succeeding in it.
During the interview process, you should also try to get a grasp on who they are. You don’t need to hear their resume (although experience is important), but get to know them on a deeper level. You may want to include more casual questions alongside the technical points on experience.
- Ensure They Start Right
The process of finding a great CEO does not suddenly end when they have signed the contract. When welcoming a new CEO to the company, make sure you start on the right foot.
Ultimately, choosing a new CEO will depend on the nature of your organisation. Every Board has their own priorities and plans and it is essential the CEO understands the company’s goals. Above all, there should be good communication between the CEO and Board.
A Board Portal like Convene will make these relationships easier. From drafting the meeting minutes to establishing a strong audit trail, a Board portal is designed to support efficient communication. With smart features such as shared annotations, instant voting and action items, you can ensure a strong relationship with your new CEO.