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When Yesterday’s Leaders Can’t Lead Tomorrow’s Business-some ideas from Doz & Kosonen

One of the enduring dilemmas of any successful business is that there will inevitably come a time when those who led the great success of the past will be faced with the erosion of what made the past so successful, and the need to develop new capabilities, skills, market positions and the like.  Often, such a shift is deeply threatening to these former leaders, setting in place all kinds of dysfunctional behavior throughout the organization and ultimately hampering its ability to effectively mobilize around new opportunities.  But what can you do?  These folks are often very respected, have deep internal networks, are seen as representative of the company to outsiders and have considerable formal and informal authority. 

An interesting idea for how to deal with this is in Yves Doz and Mikko Kosonen’s brand-new book Fast Strategy.  The book is getting great reviews for its practical but novel ways of thinking about strategic agility. 

The excerpt that caught my attention is on page 91-92, as follows:image

Letting the “Old Heroes” move on gracefully

The way in which high-powered executives move out from the core team in connection to top team renewal matters greatly.  A graceful exit or transfer of those core team members who have naturally outgrown the new organization is very important.  These executives have typically served the company successfully for many years and people across the organization have great respect for them and want to see them treated well.  Yet they can seldom continue in the new top team, particularly if the new CEO comes from inside the company.  It is difficult to chnage well-established interaction patterns with an ex-peer and, secondly, these executives have typically outgrown those roles that are available in the new organization. 

They would simply not start from an equal basis with the rest of the new team, which, again, would harm the team-building efforts described earlier.  Furthermore, accepting a smaller and less meaningful role is not motivating and would not look respectful and credible in the eyes of the organization. 

It is therefore very important to link the retirement or transfer of senior executives to changes in the market place and the subsequent top team renewal.  This way there is a ntural business reason for the change and it happens to several key people at the same time.  people in the organization understand these reasons and hence transferring loyalty from an old leadership to a new top team is easier. 

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