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CEO transitions: the implications for coaching in South Africa

Thesis (M.M. (Business Executive Coaching))--University of the Witwatersrand, Faculty of Commerce, Law and Management, Graduate School of Business Administration, 2015. / The study explored the CEO transition process that takes place in the handing over of the organisation from the outgoing CEO to the incoming CEO and how executive coaching can facilitate the transition process.
The past two decades have seen a reduction in the tenure of CEOs. In addition the transition period has contracted. This means that the incoming CEO is often faced with many challenges that may have been alleviated in a longer or more structured transition process.
As CEO succession has a major impact on the organisation, and is disruptive in itself, executive coaching might present an opportunity to manage the transition and improve the settling in and effectiveness of the incoming CEO and thereby the performance of the organisation. .
Friedman and Olk (1995), Garman and Glawe (2004) and Vancil (1987) defined a structured CEO succession and transition process in organisations. The transition process is conceptualised as a settling-in period where the designated CEO and outgoing CEO work together in a dual capacity whereby the organisation would slowly be transferred from one to the other over a period of months or even years (Kakabadse & Kakabadse, 2001).
The Chairman plays an influential role in selecting the incoming CEO (Dalton & Dalton, 2007b; Engelbrecht, 2009; Fredrickson, Hambrick, & Baumrin, 1988) and in supporting the incoming CEO in his/her initial appointment period (Kets de Vries, 1987). There are various factors that determine the selection of an insider CEO or outsider CEO based on the performance and future strategy of the organisation (Dalton & Kesner, 1985; Friedman & Olk, 1995; Khurana, 2001; Ocasio, 1999; Zajac, 1990). The selection of the incoming CEO is important as it impacts the market value of the organisation and creates disruption within the organisation (Grusky, 1963).
The incoming CEO, whether an insider or outsider CEO appointment, experiences many challenges when taking up the position. These challenges include delivering continuous growth, improved performance and profitability of the organisation (Bower, 2007; Giambatista, Rowe, & Riaz, 2005), managing key relationships with the Chairman, Board of Directors, Shareholders, key customers and suppliers as well as the management of people within the organisation. Other challenges are of a more personal nature, such as self-doubt and balancing work-life (McCormick, 2001; Stajkovic & Luthans, 1998; Stock, Bauer, & Bieling, 2014). Many of these challenges can be attributed to the reduced transition period that an incoming CEO has (Charan, 2005).
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There are various support structures available to the incoming CEO to supporting the incoming CEO in his/her initial appointment period. These include the Chairman, mentors and executive coaching. Various coaching models were considered in supporting the incoming CEO through the transition period and the challenges experienced (Bond & Naughton, 2011; Passmore, 2007; Saporito, 1996). The aim of exploring executive coaching models was to recommend a coaching framework that could be used in the CEO transition process.
The research methodology used in the study was qualitative. Semi-structured interviews were undertaken in order to gain insights from the lived experience of CEOs, Chairmen and Board of Directors of organisations (Ponterotto, 2005; Wimpenny & Gass, 2000). Further to this an analysis of the CEO turnover in the Top 40 companies listed on the Johannesburg Stock Exchange (JSE) was undertaken, which served to triangulate the results from the respondent interviews.
It was found that there was both planned and unplanned CEO succession in organisations and this impacted the transition process and period that took place between the outgoing CEO and the incoming CEO. Planned CEO succession usually arose from the planned CEO retirements and allowed for a long transition period. An unplanned CEO succession arose from the untimely resignation, retirement or death of the existing CEO. This left the newly appointed CEO taking the position with a very short transition period, if at all.
Following from the planned and unplanned CEO succession there was found to be a mismatch between the theory of the CEO succession and transition processes and the practice thereof. This seemed to be more evident from a South African perspective as most of the literature on the subject of CEO succession and transition processes was internationally based with very scant South African literature available on the topic.
Executive coaching can provide the structure for the incoming CEO to orientate him/herself to the organisational dynamics, setting the vision and strategy for the organisation as well as the effective execution of that strategy. Further, executive coaching can assist the incoming CEO in the personal challenges of leadership, managing people and stakeholders as well as self-doubt and work-life balance that the newly appointed CEO may experience.

Identiferoai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:wits/oai:wiredspace.wits.ac.za:10539/18364
Date January 2015
CreatorsGray, Edelweiss
Source SetsSouth African National ETD Portal
LanguageEnglish
Detected LanguageEnglish
TypeThesis
Formatapplication/pdf

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