Twitter’s Lesson on How NOT to Do Succession Planning
When Dick Costolo decided to step down as CEO of Twitter earlier this summer, he had already known for quite some time his days were numbered. He even offered to step down last November and again in February amidst reports of Twitter’s disappointing earnings. His departure in June certainly did not surprise many who follow the company. What surprised many is how Twitter handled Costolo’s exit.
The search for Twitter’s new chief executive is now three months old. Rather than announce a new CEO, Twitter brought back co-founder and former CEO Jack Dorsey as interim CEO. Though many predict Dorsey to eventually get the nod for CEO, he is also CEO of the mobile payments company he co-founded, Square, Inc., which is purportedly set to go public later this year.
Most corporate boards would not consider naming Dorsey as CEO if he were to remain CEO of Square. Twitter has also noted that it wants a chief executive who can make a full-time commitment to the company, citing that the mobile service needs strong leadership to help reverse stagnant user growth and a steady stream of high profile executive departures.
CEO succession planning (both emergency and long-term) can be a complicated process, especially so for a public company. Not having a clearly articulated plan in place leaves Twitter open to commentary from all sides, and can create damaging uncertainty with investors. Bringing back Dorsey, even short-term, demonstrates Twitter most likely did not have an adequate plan in place for Costolo’s succession. Months without clear leadership for any company can also create political minefields, with key personnel jockeying for positions in the senior ranks (or jumping ship in Twitter’s case).
While Twitter will neither be the first nor last organization to struggle with succession planning and execution, it exemplifies an issue that any corporation, large or small can fumble on. While the situation is unfortunate, it is far from uncommon. The reality is, and perhaps understandably so, planning your exit isn’t usually the most exciting or pressing task for a leader, but it is essential.
In what can be a harrowing process, many business leaders who do attempt to make a plan take on too many tasks by themselves. Others simply don’t start early enough to identify and prepare the right people for future roles. With so much at stake – both emotionally, financially and professionally – the key is simply to bite the bullet, start early, and be thorough. Doing so can create a smooth transition that keeps confidence strong among customers, investors, and employees. This confidence can play a major role in ensuring the success of your company’s future and enhancing your own personal legacy.