Key Pointers

1. Be prepared.  The day a new Chief Executive assumes the role, one thing is certain: someone, some day, will succeed him.  It follows there should always be credible potential successors to the Chief Executive, even if none of them is the perfect article.
2. Ensure the business is not critically dependent on one individual.
3. Make sure people appointed to the top team operate in ways that reinforce   the organisation’s espoused culture.
4. Engage in development of the top team.  The Chief Executive must create a constructive environment in which people can blossom individually and work together effectively.
5. Ensure top team members put the health of the business ahead of personal ambition.
6. Know when an internal candidate is a better fit than an external one.  “ I spent a huge amount of time researching this issue of CEO succession.  In companies that are doing well and with a culture that is successful, you tend to find that the internal candidate is much more successful than the external candidate.  It is where the culture is broken and the performance is in tatters that it needs a change in direction from the outside”  Gareth Davies, Chairman, William Hill.  Quoted in the Daily Telegraph, July 5th 2014. 
7. Have a contingency plan.  If a Chief Executive vacancy arises earlier than predicted, who will be the interim CEO?
8. Support – the Board must support the new Chief Executive to build confidence and mitigate inexperience.

Adapted from a Praesta Insight document on Continuity and Succession