IT Employment

Making the transition from CIO to CEO

The newly named CEO faces a lot of work when moving out of one job and into the next. Jennifer Recktenwald explores the benefits of a pre-named successor, the first days on the job, and hiring the right team.

After no less than 10 rounds of interviews, finally the call comes. You’re offered the job as president and CEO of a growing international corporation.

You accept immediately, and as you say goodbye, you think, “Now what?”

As a newly named CEO, there’s a lot to do as you phase out of one job and into the next. In this article we’ll explore:
  • ·        The benefits of having your successor in place
  • ·        The first days at the new job
  • ·        Putting together the executive team
Those CIOs gunning for the CEO's job have lots of things to consider, including whether such a vertical move is realistic, what path is best for becoming a CEO, and how to manage expectations as a new CEO.We're addressing these questions in a series of articles on moving from CIO to CEO. Check back next week for the final installment.
Don’t leave a disaster in your wake
When IT executives leave one job to take another, they often leave their department in a state of chaos and disarray because no one has been trained to take over when they’re gone. Mary Ann Masarech, product manager of career transitions for the an outplacement and career transition firm of Drake Beam Morin, notes the importance of having a successor ready to take the spot you’re vacating.

“When you’re networking, you’re thinking about where you’d like to go, but you also have to be cognizant” of the well being of the organization, she said. “It helps if you’ve been grooming someone to step into your own role. That’s only going to put you further ahead. It helps to have someone who has a sense about what you do who can move into the role quickly.”

Ron J. Ponder said he was fortunate to have a successor when left his job as CIO at AT&T to become president and CEO of Beechwood, a provider of operations management solutions to the telecommunications industry.

“I had a lot of support at AT&T [from] very capable people. You should always hire people who are better than you are. I had two or three people working with me who were very qualified. I took six weeks to two months to phase out and hand over everything. It worked very smoothly.”

James Rutt, CEO of Network Solutions , the world's largest registrar of domain names, agrees that phasing out of the CIO job is a much smoother process when a capable successor is in line. When Rutt resigned as chief technology officer at The Thomson Corporation, one of the world’s largest information-based services organizations, his replacement had already been named.

“I helped in the beginning. He’d call a few times a week and we’d trade ideas, but it was really no issue at all. That would be effective career management for people, because quite frankly, it makes it a lot easier to move on if you have someone to take your place.”

Beyond leaving behind an unqualified successor, another matter that can wreak havoc on your old company is the publicity surrounding your move. Once you’ve notified the CEO and executive staff of your departure, internal and external publicity needs to be under control. It’s helpful to involve a media expert or the company’s public relations director and to ask the individual to prepare a draft of an announcement. Any statement received by reporters other than a prepared release only increases their instincts for a hot story.

What to expect in the beginning
The first days and weeks as a CEO will, no doubt, be stressful. It’s impossible to predict all of the challenges, and those who are there say it’s best not to try. “There [were] surprises every hour,” Ponder noted.

Rutt didn’t anticipate the series of government contract negotiations held shortly after his arrival at Network Solutions. “It suddenly became the number one thing within a week of when I got here,” he said. “That caused me to switch gears very quickly. I thought when I came here my first issues would be operational improvements. And I kind of got sidetracked on that for about three months while we worked our way through issues that boiled up a week after I came through the door. It was a little bit of a surprise, but I adjusted pretty quickly.”

The best way to prepare for the challenges is to be well informed on the front end and learn as much as possible about the organization before coming on board.

Because Rutt studied Network Solutions in the weeks before he came in, “I was able to jump in and be effective more quickly. I could understand what the issues were from the get-go,” he said. “Within a few weeks, I was able to communicate with folks in the functional areas and make decisions. My learning curve was less than it would have been otherwise.”

George Stiles, a managing director with Executive Options, a Wellesley, MA-based executive coaching firm, recommends that new CEOs spend much of that time focusing on employees. They will be looking to their new leader for answers and guidance, and it’s important to schedule plenty of “face time” with them.

Katherine Hudson worked in finance, communication and public affairs, information systems, and several business units at Eastman Kodak before signing on as president and CEO of Brady Corporation , a Milwaukee-based manufacturer and marketer of identification, safety, coated material, and graphics products. Because she changed jobs so often, she found it helpful to develop her own job-changing system.

“What I would do is take the first 60 to 90 days in a new job to do nothing but listen and make it a point to meet every customer, every employee, every business partner that I could,” she said. “When I went to Brady that’s exactly what I did. I put on a pair of sneakers and walked through the factory, shook as many hands as I could in Milwaukee, then went on a global tour to see all the facilities and meet all the people. Then I went into the soft agenda phase. Once I learned things, I talked to staff about a trial agenda, tested that for another 60 to 90 days, then went into an implementation phase.”

Hiring the right people
Hudson adds that the biggest hurdle a new CEO can clear is putting together the right team at the top.

Marc Lewis, managing director and head of corporate IT practice for the an outplacement and career transition firm of Christian & Timbers, recommends that the new CEO hire a strong chief financial officer who has great knowledge of and comfort with the Wall Street community.

“That person may be in place, but a strong CFO will frequently be the most important ally for the CEO,” Lewis said. “A mistake the CIO who moves into the CEO role will make is to not seriously consider bringing in their own CFO. As good as the original CFO may have been, having that close partnership that comes from helping someone else’s career is much easier to attain than simply inheriting someone who may not be the best fit with the new CEO.”

Beechwood’s Ponder agrees that a chief financial officer will be an important hire for the new CEO.

“You have to pay a lot of attention, very quickly, to the financial side of the house and measure the criteria for the financial side. You want to hire someone with the financial compass to grow the company.”

Ponder had to build a complete team from the ground up when he joined the company. He worked to put the new team together quickly to avoid losing ground.

“You need to trust your instincts about management,” he said. “If you feel the organization has outgrown the people, your number one priority should be to bring in people who can run the current organization and also a larger organization—people who’ve had experience at both large and small companies and start-ups.”
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