Microsoft’s Lesson in Poor Succession Planning

February 14, 2014
After announcing the departure of 33-year company veteran and CEO Steve Ballmer last August, Microsoft has only just declared his successor – Satya Nadella. While tech news insiders agree with the internal Bill Gates-like choice, the lack of a clear succession plan from the start, has left an indelible mark.
Ballmer held his position as CEO for the last 14 years, giving Microsoft more than a decade to develop a succession plan. Yet when the announcement was made that he would step down, not only was a successor not named but the timeline and process for finding his replacement was vague. This left the company open to commentary from all sides for potential candidates, and it created damaging uncertainty with investors. Months without a clear, singular vision for any company can also create political minefields, with people unsure of whose approval to attain due to divergent visions and others jockeying for positions in the senior ranks.
If all that alone wasn’t enough to create confusion, only two weeks after Ballmer’s noted departure Microsoft announced that it would be acquiring Nokia for $7.2 billion, the second-largest acquisition from the company behind Skype.
As we can see, even a large corporation with plenty of visionary leaders on its Board of Directors, including Bill Gates, can fumble on a succession plan. While the situation is unfortunate, it is far from uncommon. The reality is, and perhaps understandably so, planning your exit isn’t usually the most exciting task for a leader, but it is essential.
In what can be a harrowing process, many business leaders who doattempt to make a plan take on too many tasks by themselves. Others simply don’t start early enough to identify and prepare the right people for future roles. With so much at stake – both emotionally, financially and professionally – the key is simply to bite the bullet, start early, and be thorough. Doing so can create a smooth transition that keeps confidence strong among customers, investors, and employees. This confidence can play a major role in ensuring the success of your company’s future and enhancing your own personal legacy.
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