Build an Academy Company to Maintain Full Succession Planning Lists
Companies that master the succession planning process develop reputations for excellence. These “Academy Companies” turn out a wealth of Chief Executive Officer candidates capable of helming large organizations, whereas most companies may feel fortunate to develop one leader.
General Electric is a prime example of an academy company. When former CEO Jack Welch was choosing his successor, he found three candidates: Jeffrey Immelt, Robert Nardelli and James McNerney. After Immelt was chosen, Nardelli went on to become CEO of Home Depot and later Chrysler. He is head of Cerberus’s Operations & Advisory Company. McNerney became head of 3M and then Boeing, where he is currently the CEO.
Many other leading companies also have formalized systems in place to develop leaders. Recognizing the importance of providing employees opportunities for advancement, AT&T offers a leadership training program that has already trained over 100,000 AT&T managers. Even Apple is rumored to have a university of its own: Apple University, led by Joel Podolny, former dean of Yale’s School of Management. In a style not unusual for Apple, however, most of the details are shrouded in secret.
While academy companies may eventually lose some of their candidates to other companies, as GE did, they get the benefit of 1) having a deeper bench and stronger leaders and 2) having former executives in place at other companies with natural ties back to their original organization. Such long-term academy company advantages pay succession planning dividends for many years.