Why new leaders can’t succeed alone

We all know that it’s lonely at the top — even more so for new leaders — but the math says it’s actually pretty crowded too. Let me explain.

I took one of my current roles (CEO) just about 10 years ago, and picked up the other (Chairman) about six years ago, so my first 90 days were about 3,000 days ago. This begs the question, “What do I know about being a new leader?”

My answer? While on paper it looks like it has been a long time since my first 90 days in role, in reality they began just yesterday.

That’s because any organization that is designed to thrive is in a constant state of reinvention, and as leaders we must routinely start anew. I lead a very different company than the one I took over. We are roughly four times the size, have different investors, a different capital structure, a wildly different set of products, and a continually evolving set of leaders and markets.

Understanding ongoing reinvention was not unique to us, we decided to look more closely at the roles of new leaders and their transitions. We support about 6,000companies globally with revenues ranging from $100 million USD to well into the billions, and the number of leadership transitions we discovered in this population alone startled us. More surprising, we learned that for something so frequent, transitions continue to be treated as a very rare event.

To build better succession planning databases, we have tracked turnover levels at the top levels of companies for a number of years. To average out a whole bunch of variables – across roles, levels and economic cycles – we estimate that the turnover rate is roughly 25 percent. Even if you assume the term “leader” applies only to C-levels and their direct reports (around 40 people per company), 10 members of the top team turn over each year. Across our 6,000 companies that yields 60,000 transitions a year – or roughly 300 per working day. If you extend the term leader more broadly within these organizations (or to smaller companies, or the public sector, or to startups, or to newly launched projects and initiatives), the number grows exponentially.

Conservatively, it’s safe to say that more than 10,000 people step into new leadership roles every working day. That’s a pretty crowded type of lonely.

The good news is that large data sets lend themselves to analytic rigor, and 10,000 transitions gave us a rich data set to examine. More importantly, the data allowed us to understand the positive economic impact of great transitions and to identify steps leaders and organizations can take realize that impact themselves. Our whitepaperoffers in-depth findings, but I wanted to share a few lessons that struck me as I began my leadership journey anew:

• The economic stakes are high. Well-managed transitions drive profit up by to five percent (5 percent), yet activities of similar value get much more focus.
• Context matters hugely. Is this a new role? Are you following an icon or a train wreck? Was the predecessor effective but overstayed her/his welcome? The path to success depends on accurately assessing the situation and adapting plans accordingly.
• If the transitioning leader alone is held accountable for success, they will likely fail. Peers, subordinates, and senior leaders all must be part of a vital (and accountable) support network.
• The 90-to- 100-day construct woefully understates the timeline of an effective transition, which can often take more than a year. If anything, this tends to give false comfort – or worse, reward “quick wins” at the expense of real accomplishment.
• Lastly, the organization must treat a leadership transition as an everyday activity (because it is).

As I start my most recent “first 90 days,” I’ve benefited most from the third finding — a leader doesn’t succeed alone. I’ve enjoyed mentorship (and tough love) from my Board, along with support and (when needed) dissent from my team. More importantly, on our best days we “swarm” new leaders throughout the organization to make them successful and continue to do so well past their first three months.

This article is published in collaboration with LinkedIn. Publication does not imply endorsement of views by the World Economic Forum.

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Author: Tom Monohan is Chairman and CEO at CEB.

Image: A worker arrives at his office in the Canary Wharf business district in London February 26, 2014. REUTERS/Eddie Keogh.