►On average, a company takes three to four years to complete an internal succession process.
A large Brazilian multinational company, with US$ 3 billion in net revenues and 44 thousand employees, took 3.5 years to complete its CEO succession process, applying a series of well structured practices that lead into a smooth transition, which was well evaluated by the national and international capital markets.
Both the board members and the previous CEO believed that an internal candidate would better manage the strong company’s culture, taking the best out of its characteristics. At that same time, they wanted the new CEO to foster innovation and to question the status quo so that the company would reach a new level of profitability and globalization, as expected by the shareholders.
The transition process began with a thorough competency assessment program involving the executives in line of succession. Once the strengths and gaps of competency were identified, a sound leadership development plan was implemented. Parallel to the individual initiatives, the organization was restructured as a consequence of acquisitions and strategic plans. Internal candidates were allowed to experience deep changes in responsibilities through an intense job rotation program, which helped stretch and strength their competencies, preparing them to assume larger roles.
The succession process was closely monitored by the Board’s Human Capital Committee, and counted on the intense dedication of the previous president and the HR Director.
Some of the following practices contributed to the success of the process:
The nurturing of internal candidates
• The continuous mapping and monitoring of all executives’ competencies, including those executives integrated from acquired companies, was key to maximize the return on training investments.
• Once the successor was selected, a series of promotions and lateral moves followed. The organization was fully prepared to conduct the changes, given its deep understanding of the capabilities and readiness status of the executives.
• The previous CEO took the time to introduce the new CEO to national and international financial markets, to Brazilian and foreign clients, and to government agency representatives.
External consulting support
• External consultants brought neutrality, rationalization, consistency and articulation support to the succession process, improving trust and accuracy levels along the whole change journey.