It may not enough time for most new managers to get in a few extra days at the beach, but the period between the "you're hired" telephone-call phase and Day One on the job is
expanding for CEOs, says a recent report. The report, written by New York City-based PR giant Burson-Marsteller and taken from a sample of Fortune 1000 CEOs, says
there is now a 49-day average between the first public announcement of a new CEO and the official start date -- an increase of nearly two weeks between 2003 and 2004.
"What we're seeing is that more and more CEOs are leaving the corner office," says Leslie Gaines-Ross, chief knowledge and research officer at Burson-Marsteller. The
increasingly high rate of turnover, evidenced by the growth in new CEOs in 2003 and 2004 (see chart), has led to higher-quality and longer-term succession planning. What's
more, it's placed the onus on PR managers to get a head start when it comes to handling transitions.
"It's a good way for PR pros to really hit the ground running along with the new CEO," Gaines-Ross says. With 60% of CEOs experiencing a countdown transition period -
compared to the 40% who take office immediately - execs have more time to establish a rapport with their senior managers.
The report also reiterates the benefits of promoting insiders, as internal CEO promotions result in double the countdown period - 60.7 days compared to 27.7 days for
outsiders - and it minimizes the chance that the new CEO will come in and replace existing senior PR managers with new ones.
While a recent Cutting Edge Information study suggests that PR pros continue to struggle with succession planning (see PR News, July 27), the Burson-Marsteller
report says otherwise. It shows that the board members responsible for hiring new CEOs are one step ahead of the game, preparing for a CEO's future successor as early as his or
her first day on the job. It's a lesson that should not be lost on senior PR execs. The best way to anticipate future successors is to work alongside hiring committees by pointing
out important constituencies and preparing in the interim for Day One, in which the media spotlight is dimmest.
"It's really important to plan for a new CEO's arrival, whether you have two weeks or two years," Gaines-Ross says. "It's setting up a situation that's win-win for the PR
professional and the new CEO."
Contact: Leslie Gaines-Ross, 212.614.5181, [email protected]
CEOs In Transit
|
CEO TRANSITION PERIOD
|
|||
|---|---|---|---|
|
Year
|
Total New CEOs
|
RANGE
|
MEAN
|
|
2000
|
58
|
0 to 284
|
33.4
|
|
2001
|
58
|
0 to 341
|
31.7
|
|
2002
|
43
|
0 to 289
|
31.0
|
|
2003
|
85
|
0 to 209
|
36.5
|
|
2004
|
97
|
0 to 317
|
49.3
|
|
INSIDER CEO TRANSITION PERIOD
|
|||
|
Year
|
Total Insider CEOs
|
RANGE
|
MEAN
|
|
2000
|
36
|
0 to 284
|
44.4
|
|
2001
|
37
|
0 to 341
|
46.0
|
|
2002
|
26
|
0 to 289
|
40.0
|
|
2003
|
55
|
0 to 209
|
48.9
|
|
2004
|
64
|
0 to 317
|
60.7
|
|
OUTSIDER CEO TRANSITION PERIOD
|
|||
|
Year
|
Total Outsider CEOs
|
RANGE
|
MEAN
|
|
2000
|
22
|
0 to 61
|
13.3
|
|
2001
|
21
|
0 to 33
|
7.2
|
|
2002
|
17
|
0 to 125
|
17.0
|
|
2003
|
30
|
0 to 92
|
13.9
|
|
2004
|
33
|
0 to 169
|
27.7
|
Burson-Marsteller defines the transition period as the amount of time (in days) between the announcement of a new CEO and the date that the executive officially takes office.
An insider CEO is an executive who has worked inside the company for at least three years prior to becoming CEO. An outsider CEO is an executive who has worked outside the company
or inside the company for less than three years prior to becoming CEO.