When a college names a new president it is an exciting time and marks a new era at a school. At this time of transition, much of the attention—appropriately is focused on the new leader. Yet, there are many interconnected transitions happening, including if and how the former president will continue to serve. In an article for Inc. Jim Schleckser evaluates the pros and cons of having a former CEO serve on a board. While having a former leader step into this position brings continuity, there are also downsides. Schleckser notes,
“The potentially bigger negative consequence of naming the former CEO to the board is that they can severely inhibit the kinds of choices the new CEO can make. That might include terminating pet projects started by the former CEO and even firing underperforming executives that were in the former CEO’s inner circle. The research is clear that the incoming CEO does not take on some of these difficult moves with their former boss on the board.
As a result, new CEOs usually add to an existing agenda rather than making the tough choices to cut existing operations and people–which can then hurt the firm’s performance. We only need to look at examples where, after the former CEO transitions off the board, the new CEO immediately starts cutting those projects and people they were reluctant to tackle before.”
Schleckser proposes a third option that capitalizes on the benefits of continued CEO involvement and minimizes the liabilities. Read his entire article here.