Great leadership can make or break a business. So when a renowned boss leaves a company, especially when they built it themselves over many decades, it leaves a vacuum. Cirrus CEO Dr Simon Hayward writes for Management Today.

The danger is that the leader who so successfully set the tone for the organisation also created a culture of dependency that leaves it directionless when they go. Martin Sorrell is a case in point. He’s recognised as a giant of the advertising industry and is renowned for his outspoken views. There does not appear to be a clear succession plan in place, and WPP has stated it will consider internal or external candidates for the CEO role. How can the board and the next CEO ensure a smooth succession after such an abrupt departure?

Immediate challenges for a new CEO

The appointment of a new CEO will always create a wave of change across a business. Different colleagues will react to change in different ways, but all will appreciate clear and consistent communication. Many new CEOs benefit from spending time with customers, stakeholders, and colleagues across the business – even if they are internal hires who have spent time in the company already. This style of ‘learning through listening’ is generally more effective than an ‘all guns blazing’ approach. It helps the new CEO to gain valuable insights. It reassures others that they will be a part of future change, rather than being swept along by it. It also helps build critical connections and win the widespread trust that is essential for the next stage – when the new CEO articulates a vision and strategic goals.

Devolution: Beyond the individual 

Clearly communicating vision and goals is an important, ongoing element of the CEO role. Achieving goals involves many others. To secure sustainable, long-term success, businesses can benefit from devolving decision-making responsibility across the organisation. This prevents an over-reliance on people at the top. It also helps to move that decision-making responsibility closer to the customer, where it can have greatest impact.

Ideally, this will be supported by a culture of trust and mutual respect, which empowers more people to take responsibility. This can be achieved through an inclusive style of leadership, which is a shift away from an individualistic, ‘inspirational’ style. When leaders build trust, others feel comfortable to take risks like making decisions. The most effective leaders trust others to do a great job, working from the assumption that they are competent and well-motivated.

A shift away from an individualistic style of leadership also highlights the importance of team work. Without a relentless emphasis on teamwork in your organisation, in hiring decisions, rewards and bonuses, leadership development, succession planning and performance management, the holy grail of becoming a truly agile, innovative, and competitive business will be more difficult to attain.

Team work creates a positive cycle of personal fulfilment for team members, improved productivity, and more joined up outcomes across each process. And in my experience, teams with the autonomy to make decisions about their work, and the ability to improve regularly, become powerful forces for change in their organisations.

The future will be agile  

The importance of becoming agile and able to adapt to the fast-moving, complex and highly competitive business environment is as important for WPP as it is for most organisations today. Digital technology has transformed the advertising industry.

Advertising and media-buying agencies such as WPP are under constant threat from industry-disrupting power players such as Google and Facebook. In 2017, when WPP reported slowing sales, Sorrell acknowledged that ‘digital disruption’ was forcing companies to change their business models and reach customers in different ways. Following a recent drop in share price, Sorrell admitted that WPP had received a ‘walloping’ as multinational brands moved spend away from traditional advertising.

As industries transform, so leaders need to transform too. It will be interesting to see who takes on the role at WPP, and how they adapt the business for the digital world in which we now operate.

© Management Today 2018

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