Paul Walters

Paul Walters

Senior Manager

Sara E. Miller

Sara E. Miller

Manager

In a recent coaching conversation with an executive in the pharmaceutical industry, an external hire found herself failing to achieve success after a year in the role. Brought in with a strong mandate to create systems, processes, structure, and much-needed accountability for a languishing business unit, she was on the verge of being exited from the company. She knew she held the capabilities to enact the necessary changes, but the organization had failed to support her through the transition process. The board had essentially hired her and sailed away, assuming she could independently navigate the transition successfully and achieve her mandate. Essentially, she was being asked to swim to a destination without knowledge about the tides, water temperature, or marine life. Without this knowledge, she felt she was drowning. The board’s short-sighted approach dramatically affected that executive, the people she led, and the business unit’s performance. 

Leadership transitions represent a critical juncture in the lifecycle of any organization. For the executive stepping into a new role, the team looking for direction, and the organization seeking growth, these moments are loaded with potential yet fraught with peril. Many businesses invest significantly in recruiting high-caliber leaders but fail to extend that investment into the crucial early months of a leader’s tenure. Time and again, CFAR consultants and coaches have seen this oversight lead to a precarious scenario where failure rates escalate, team morale plummets, and financial and reputational costs soar due to the premature exit of leaders. Studies suggest that between 27% and 46% of executive transitions are regarded as failures or disappointments[1], resulting in a huge cost to the organization. 

On the flip side, when leadership transitions are successful, companies experience multiple benefits, such as:

  • 90% of teams go on to meet their three-year performance goals
  • Attrition risk for such teams is 13% lower
  • The level of discretionary effort is 2% higher
  • They generate 5% more revenue and profit than average[2]

While an incoming executive’s credentials are a key contributor to success, they are only one factor. Successful leadership transitions rest equally on the support system surrounding the leader during this vulnerable period.

In this light, introducing structured transition support programs, such as CFAR’s Leadership Transition Program, becomes not just beneficial but essential. Designed to support leaders through their early days, this program’s ultimate goal is to set a leader up for success in their new role by fostering inclusion, trust and influence, team building, innovation, and, ultimately, performance. When we work with leaders in this context, our approach ensures that leaders are not just placed in roles but are holistically prepared to thrive in them by crafting a robust action plan that combines leadership assessments, stakeholder interviews, a transition lab, and dynamic executive coaching. Our approach is grounded in a research-based[3] framework — each component must be carefully understood and managed to ensure leader success through the transition. 

The framework focuses on the following:

Strategic Purpose
The heart of effective leadership lies in a clear, compelling strategic purpose. Leaders must articulate a vision that not only aligns with the organization’s goals but also inspires and mobilizes their team. This pillar emphasizes the importance of setting strategic priorities, defining measurable objectives, and communicating these goals clearly to all stakeholders.

Team
No leader can succeed alone. Building, assessing, and aligning a high-performing team are crucial steps in the leadership transition. This involves understanding team dynamics, identifying talent gaps, and fostering a culture of trust, accountability, and collaboration. Leaders must also invest in their team’s development, ensuring they have the skills and support to achieve collective goals.

Culture
Organizational culture shapes every aspect of how a company operates. New leaders must quickly grasp the existing cultural landscape and identify how it supports or hinders strategic objectives. This pillar focuses on leveraging cultural strengths, addressing areas of misalignment, and initiating cultural shifts that reinforce the strategic purpose and desired behaviors.

Key Stakeholders
Successful leadership transitions require key stakeholders’ identification, understanding, and engagement. These include internal partners, such as team members and cross-functional leaders, and external stakeholders, like customers, partners, and industry influencers. Effective stakeholder management ensures broad-based support and facilitates smoother implementation of strategic initiatives.

As we look towards fostering resilient and dynamic organizations, the evidence is clear: investing in leadership transitions is not an optional luxury but a strategic imperative. The leader’s success and the organization’s success are inextricably linked.

In our work with clients, we hope to serve as a beacon for those seeking to navigate these waters successfully. We offer a proven nautical chart for leadership success that benefits the individual, the team, and the entire organization. Bon voyage!

[1] Scott Keller, “Successfully Transitioning to New Leadership Roles,” McKinsey & Company, May 23, 2018, https://www.mckinsey.com/capabilities/people-and-organizational-performance/our-insights/successfully-transitioning-to-new-leadership-roles.

[2] Ibid

[3] Thomas North Gilmore, Making a Leadership Change: How Organizations and Leaders Can Handle Leadership Transitions Successfully. (San Francisco: Jossey-Bass, 1988).

Ajit Kambil, “Time, Talent, and Relationships,” Deloitte Insights, May 14, 2014, https://www2.deloitte.com/us/en/insights/topics/talent/time-talent-relationships.html.