That's why boards are starting to consider interim arrangements earlier
Most boards bring in an interim CEO after something has already happened. Lars Hygrell, Director at Interim Search, has noticed that more companies are starting to think one step ahead. He shared this insight during his appearance on the podcast Board Chat with Petra Palmgren Lindwall and Jonas Fasth. This is the first of five parts based on the conversation.
The five-year plan is no longer viable
Lars has served on Electrolux’s global executive team and currently sits on the board of Nimbus. His view is that the pace of change has accelerated significantly and that it hasn’t become any easier to predict what will happen next year, despite AI and all the computing power available today. Turnover in executive teams is higher, and the skills a company needs today are not necessarily the ones it will need tomorrow.
“Man kan inte planera för fem år idag. Man behöver kanske växla över till expertkompetens, någon som har en helt annan erfarenhet än vad man trodde för bara ett år sedan”, säger Lars.
The succession plan is rarely finalized
Petra points out that it is the board’s responsibility to think through in advance how key roles will be filled if someone leaves, but that she rarely hears of boards planning in this way. Lars recognizes this situation. He has yet to encounter a board that explicitly includes interim leadership as part of its strategy. The strategy is usually a robust succession plan, and it’s rarely finalized.
For some roles on the executive team, there is a natural successor. For others—often the CEO—the hope is that nothing will happen before the intended successor has grown into the role. Then something happens along the way—an illness or a resignation—and an interim appointment becomes necessary after all.
More people get in touch before anything has happened
At the same time, Lars is seeing a change. More companies are reaching out to discuss their staffing needs before an urgent situation arises. What kind of expertise would we need, and are there examples of people who could do the job? Some make up their minds quickly, while others need a few weeks.
Interim leadership works best when the board knows why it is bringing someone in. It could be an acquisition, a divestiture, or a major cost-cutting program, where an external leader can drive the work forward without having to defend decisions made two years ago.
Petra takes it a step further. If a company knows it is facing a transition for which it lacks experience, the strategy may be to bring in change leaders on an interim basis from the start. Lars calls it ”a very forward-thinking and modern approach to strategy.”. Some companies have started thinking that way, but for most, it's the next step.
The entire conversation is available on the podcast Board Chat.
Next week: an internal or external CEO when speed is of the essence.
