Transitions – sometimes they are welcomed and sometimes they are dreaded. Either way, they are never easy and when not done well can leave lasting scars.

Too often, people focus on the logistical aspects of the transition and neglect the interpersonal. The departing leader, the new leader and the board all play critical roles. They must manage the interpersonal, and if they do, there is much greater probability that the transition will go smoothly.

Business, transitions occur for many reasons:

  • Owner sells business to family member, partner or outside interest
  • Leader changes role to allow key associate or family member to advance in the organization
  • Crisis such as death, accident or illness requires an immediate transition
  • Leader chooses to leave the organization or is forced out by owners or board

So why are transitions so hard, and so often handled badly? Three reasons: identity, emotions and relationships. Each of these determines the nature and processes of the transition.

Identity: Many leaders define who they are by what they do. They enjoy the recognition and perks that come with being the leader. People in the organization do whatever they ask and outsiders are eager to meet with them and often respond quickly. As leaders steps aside, they find that the allegiance is to the organization and not to them. They lose their expense account and administrative support. Who are they after they are no longer the CEO? They are left with no identity and no resources. Unless that is replaced with something else, they are lost.

Emotions: This feeling of loss is one of many emotions that come into play in transitions. Other possible emotions are anger, confusion and sadness on the negative side and relief, exhilaration and calmness on the positive. Whether the positive emotions outweigh the negative may be caused by why there was the transition (desirable or not) and whether the person or people leaving have created another role and identity for themselves outside the organization. Ideally this new role is both meaningful and time consuming to create positive emotions.

The new leaders are dealing with emotions as well, which could be equally positive or negative. Are they relieved to now be in charge or fearful they are not up for the task? Are they nervous about being listened to and followed or enthusiastic to have the opportunity?  Unless the departing leader is totally gone from the organization both parties will end up dealing with both their own negative emotions and those of the others.

Relationships: When the former leader is still involved in the organization in some capacity, his/her relationship with the new leader is key. Two key components of the relationship are past history and trust. Did the former leader previously work with the new leader? Is it a parent/child or similar senior/junior relationship? Do the leaders trust each other and is the former leader willing to let the new leader make their own mark? Often the former leader wants the new leader to run the organization just as he/she did. When the new leader does it differently, as they always will, that puts added strain on an already emotional relationship.

So, how do leaders best handle transitions? Consider the following:

1. Clearly define roles for the former leader within the organization. While a clean break is usually healthiest for the new leaders and the organization, for many reasons this often does not occur. If the former leader is the owner, parent or CEO becoming chairman, they will still want to be involved in some way. It is healthiest for the organization if the former leader has a well-defined and limited role. Most of his communication should be with the new leader and not the people under him/her.

2. The former leader creates a new identity. Often the new leader, board members or consultants could help the former leader create his/her new identity. What are the former leader’s passions, interests and hobbies? While hobbies, such as golf, are time-consuming they rarely give the former leader the mental stimulation or recognition they need to form their new identity. Could they volunteer, mentor or consult outside the organization or take on a project of some kind? This is a time when the former leader could make a difference by getting involved in a non-profit or helping young entreprenuers.

3. Communication is key. When both the former and new leaders talk about their new relationship, their emotions and identities, they could work through many issues festering just below the surface. The new leaders must always treat the former leader respectfully and explain up front that they may be doing some things differently. They could identify where they are aligned and not aligned, and discuss how to resolve the unaligned areas. Everyone must be invested in helping the former leader move on and the new leaders take charge.

4. Role of the Board. The best way that members of the board could support the transition is to transition along with leadership. Members of the board who have served with the former leader and are aligned with him/her could serve as confidantes to the former leader and guide him/her through the transition. They too ought to depart the board and allow new leadership to create their own board of advisors. Too often board members use the justification of having institutional knowledge when in fact this knowledge could prevent the organization from moving forward in a reinvigorated way. Boards today require fresh thinking and diverse perspectives. What better time to create that, than in a transition of leadership.

The smoothest transitions often have a well-articulated succession plan and clear processes for managing and communicating the changes. They also address the identity, emotional and relationship issues of both the former and new leaders and create an environment of open communication among the leaders and the board. The organization moves forward by respecting the former leader while having the latitude to innovate and build a team for the future. When done well, everyone excels in their new roles and the organization thrives.