At the most basic level, leadership succession and transition is a continuous process of organizational transformation: a people decision, an organizational decision, and a strategy decision all rolled into one, with not infrequently a crisis call thrown in for good measure, according to Noel Tichy in his book Succession: Mastering the Make-or-Break Process of Leadership Transition. Leadership succession and transition is simply the most politically and culturally charged, technically challenging, and critical leadership assignment of all the many judgments that business leaders are obliged to make in the course of doing their day jobs.
This is the book which the author’s life’s work has prepared him to write. Noel Tichy has been involved as a participant or consultant in more key leadership succession decisions than just about anyone else. The book is filled with descriptions and analysis of succession decisions that went wrong and ones that went right. Nearly always, a good CEO succession starts with building a pipeline of capable leaders within the organisation, giving those leaders crucible experiences, and selecting one from amongst a number of worthy internal candidates when the succession time arises.
The book does describe a few cases in which the hiring of outside candidates has led to success, but those cases are by far the exception rather than the rule. In most cases, in the author’s opinion, the hiring of a CEO candidate from outside leads to disaster, and occurs only because the organisation’s board has failed in its duty to have a viable succession plan in place. There does, however, seem to be a difference between highly structured organisations such as the US Special Operations Forces, in which it is essential to build up the leader from within, and highly unstructured organisations such as universities, in which the leader can be recruited from outside with equal prospects of success.
Most large organisations probably spend at least a nominal amount of effort considering succession, but this book makes a convincing argument for the benefits of spending very considerable effort over an extended period of time on getting the leadership pipeline flowing. As such the book makes compelling reading for board members.