The selection of a CEO, one of the most important jobs for any board of directors, seems like an action at a point in time, an event. Win or lose – based on a single decision.
It isn’t an event. It isn’t a single decision. In poker, you have a limited number of cards and limited time to play them, but some players win big and others “go bust.” In choosing a CEO, a board has a limited number of options as well. Yet, it is all too common for a board to “fold” well before they are forced to.
What does “folding” look like?
- Holding on to the wrong CEO
- Accepting a successor who is familiar, even when they are not a “high card”
- Ceding authority of the process to others
- Human resources
- A search firm
- A high roller board member
- A pushy shareholder
- Assuming you can’t compete with the high rollers
- Going all in with a “pair of jokers”
- Substituting technique for judgment
- Postponing the decision – for years
A large industrial company did more than one of these things. A person from the company called and asked if I can “test” people. “Why do you want people tested?” I asked. A heavy silence fell on the conversation. This is like asking a high roller if they can shuffle cards. They can, but why would you have them do that?It's simple. If you want help, I need to see your hand. Click To Tweet
This takes trust, which cannot be established by proxy. The proxy isn’t going to win or lose, you are.
If you are “holding the cards,” are you in the game?