This case study, based on one of Kathy Freeman Company’s successful search engagements, is intended to illustrate our unique approach to providing strategic advisory and executive search services to investment industry companies across the U.S.
A leading investment consulting firm in the investment industry.
The firm determined it was time to identify a succession plan. Succession planning is always a complex and sensitive topic, and our client had the same sentiment. The CEO was considerably beyond retirement age and wasn’t looking to slow down. There was no one internally at the firm he had tapped as a successor, and none of the recent hires to the firm were sufficiently skilled to step into his big shoes. For three years, discussions about a succession plan were stalled.
Like other firms in the maturing investment industry, our client needed more than just a new CEO. The firm needed to do a staged transfer of management responsibility to the next generation of executives to continue the firm’s growth and best serve its clients.
We were approached by the firm to help mediate their succession issue. The firm asked us to work directly with the CEO – an assignment that required engaging him in a purposeful transition plan and executing the initiative in a collaborative and personalized manner. First, we built a foundation for the search by conducting the necessary discovery to fully understand his competencies over his very long and successful career. We then inquired about his openness to consider a diverse range of backgrounds. Lastly, we proactively communicated the rollout of the search to his clients before reaching out to the market to get their input and perspective. By notifying the clients first, they were reassured that they were a critical part of the plan, rather than hearing the news from one of the firm’s competitors or someone from the market.
After a comprehensive review of the talent pool, we presented several capable executives with substantially different backgrounds. The most challenging aspect of the search was engaging someone who would commit to a multi-year transition plan. Following our disciplined proven process for six months, we identified one candidate who had the experience, credibility, energy and cultural values that the CEO and firm were seeking. He has proved to be a perfect fit.
Difficult Succession Plans Benefit from An Outside Perspective.
The firm avoided addressing this success plan for over three years because they found it to be an awkward conversation internally. If the CEO had experienced any significant health issues during this time, and the firm didn’t have a net in place, it could have had detrimental consequences. These highly sensitive situations dictate investing in an experienced professional who can objectively define the challenge and execute against the mandate with a disciplined process.
Include Your Clients in the Process.
If your firm is considering a succession plan and the current executive is intimately connected with the firm’s key client relationships, engage those clients in the discussion before proceeding with the search process. Ask for their opinions and perspective on what they consider critical components in a successor. Clients are a great, if not overlooked, resource for ideas. Their participation in this search was instrumental in the successful outcome of this succession plan.
Patience Is Key.
Finding the right successor is often a “needle-in-the-haystack” endeavor. In this search, we spoke with over 250 executives during the process. Our client understood that this assignment would require an exhaustive search. Their patience allowed us to look broadly at the talent in the market and thoroughly screen those who could be a potential fit.