One firm faced the impending retirement of its longtime CEO and needed to be ready with a strong bench of potential successors.
DDI's immersive "day in the life" CEO assessment helped the firm take a closer look at the strengths and gaps of potential successors and then formed a plan for development.
Potential successors left with rich insights and a targeted development plan to accelerate in their current roles and expand in the future, and the board and CEO felt much more ready to make eventual succession decisions.
In this How We Did It video, Richmond Fourmy, executive consultant, shares how DDI helped one real estate development and construction firm with executive leadership succession planning. The firm faced the impending retirement of its longtime CEO and needed to be ready with a strong bench of potential successors.
Learn how the firm assessed potential successors using DDI's "day in the life of a CEO" immersive simulation and how the participants reacted to the experience. Additionally, see how the assessment insights helped the firm target development, and how the process helped the board and current CEO with future succession planning.
Learn how DDI can help with CEO succession.
Hi, everybody. And welcome back to our series on "How We Did It," where we talk about the exciting work we've done with some of our clients. Today, I have Richmond with me. Who's talking about a really great project they've done with CEO succession for our client. Richmond, welcome. I'm so excited to hear your story.
Thank you, Beth. And I'm excited as well.
So tell me a little bit about this client and what prompted them to recognize their succession challenge at the very top of the house for those C-suite levels?
Right. So this is a company that's a real estate development and construction firm, and they are family-owned. The family is very involved in the board and there's also family within the business. But the board realized they have a CEO who has been in place for quite some time and he's done very well, but the next level down is relatively young and they're not quite as experienced as the top level is. And so they wanted to see who are our successors in case somebody wins the lottery and leaves the business or whatever, or in case of retirement, there is from one president of the group.
So the board said let's take a close look at our potential successors, who are they? What are their gaps? And let's start filling those gaps. So they interviewed and put out an RFP and looked at a lot of different consulting firms. We were fortunate enough to be chosen to conduct the assessments and also help them develop folks to fill in those gaps.
So what was their approach and why did they choose DDI to help them with the way they wanted to go through this process?
They chose DDI because they saw the depth of assessment history that we have, we've been doing it for 50 years. We kind of pioneered the business simulation "day in the life of an executive." And they also really got along with us. And I think that there is something always about the chemistry of the consultant to the client company.
What they chose to do was unique because they looked at assessment from a very holistic perspective and we offered kind of the full boat of our services, which would include a pre-assessment interview with each of the leaders that we did a business impact interview as part of the assessment. So that's a very detailed, targeted behavioral interview. Tell me about a time when you've done this? And we're doing that around specific competencies. Then they did the full "day in the life of the CEO" and each of the leaders did the CEO simulation, which is our highest level of simulation.
It's challenging. And some of the people that they must meet with during that day is their board, they must meet with analysts, they must meet with a newspaper reporter. So they have to do some things that they're not used to doing. Before all of those assessments, of course, the way DDI works is we created their business drivers through a series of interviews with their executives and some of their board members. And the business drivers are the leadership challenges that every leader within the company must meet in order for them to meet their objectives.
So we develop those business drivers and then competencies cascade from the business drivers and we use those competencies to assess the leaders against. So we did the assessments, we gave feedback. We did what we call a strategic talent review, which is a very extensive review of each individual and the aggregate group with the CEO and the president of the group and the head of HR.
That was a very involved discussion, we ended up meeting for five hours because they were so engaged and it was just very rich. And they came out of that feeling like this was beyond what they had expected. It felt like we had such nuanced insight that we really nailed their people. We understood them, we got what they had seen themselves. Plus we were able to add some insights to their leaders that they did not know about.
Then we did a development planning session, so that in preparation for our development planning, with each of the leaders, we went through what the development needs that we saw in each of the leaders with the CEO and head of HR. And then they gave some input about what is available for support and development. That was also a very rich discussion, CEO felt like that it was just fantastic.
We've given feedback to each of the leaders, and now we're going back and doing development planning with them, and then subsequently, we will also have at least one coaching session to help them with their progress on their development plan.
So for these seven folks who went through and that's a nice, robust group that they're getting ready for a strong bench, what were their reactions to that "day in the life" simulation? And as you're giving some feedback now, the participant experience is really important, so how did they react to it?
It was mixed reaction. The themes were there were really well done, they really did their research. It was very realistic, it felt like a very hectic day in the office. Some of them felt it was almost overwhelming. A few of them because it was a bit of a stretch, most of them felt like that was exciting, that was fun, I learned something, which is what we typically hear from executives.
But because we were doing a CEO simulation they had two people that were three steps above where they are, and so it was a real stretch. And I think that they felt it was a bit tough. The others they had a little bit more experience, they didn't find it quite as daunting, but they definitely found it challenging, but they loved it. And in the feedback sessions, they were astounded at how much information we got from that.
And one thing that we saw as they often thought they did worse than they actually did. They're tough judges, and we also often see that in high achievers, they want to just knock it out of the park on everything. And they can't do that, it is very challenging, but they still did very well. And it's a talented group.
So that was a pleasant surprise for them to say, wow, I didn't fail completely. No, you really didn't, you actually showed some real strengths and here are some of the gaps. But that's the intent of these kinds of simulations is we want to stretch the leader enough to where we really see where their gaps are. If they hit everything out of the park and they answer all questions then we don't see where their gaps are, so we make it aspirational.
That's great and really nice feedback for them as they grow and develop. And you might think you want to be the CEO, but it turns out it's a lot harder than it even looks. What kind of development now are they entering? That's always a question for a lot of folks. What does development really look like for these very senior folks beyond just job shadowing, what can they do to develop?
So it's a great question because this is a relatively small firm. So we can't just pluck the CFO out of his role and put him into something, he doesn't have a big enough department to do that. But he also needs to establish a greater experience and repetition of establishing strategic direction. So he's going to become more involved in some of their strategy meetings. He's actually going to start facilitating and several of them.
There was a theme of they're very strong on operations and execution, they weren't as strong on developing strategic direction and vision. And so they're going to, for example, be involved in these quarterly business reviews and they're going to facilitate those reviews themselves, which will get them deeper into the strategy rather than just be a listener in the meeting. The old adage, if you need to learn something, teach it. So they're going to teach it.
They're going to spend more time being mentored by the CEO, as well as the group president. We looked at whether they needed to go to some executive education school, but in none of the cases, some cases we do recommend something like that, finance for non-finance executives, something like that.
But for these guys, we just didn't feel like that would meet their needs. Their businesses are rather esoteric and so they needed to really just do the things that are outside their normal role. And so that would be a special assignment, projects, special initiatives that they'll be involved in and will give them some additional exposure.
Great. So as the board is watching this, and you mentioned a little bit about some feedback that you have gotten from the CEO on board, how are they monitoring this process? And how involved are they in it?
They're very involved, the board is hands-on. And in fact, they had a board member on the project team all the way through the project, up to development planning. And then we're also going to use two board members as mentors to two of the leaders. In one case, there's a female board member who's in the construction business and has done very well. And there's a young woman in the business that as one of the leading candidates, and we're going to have them work together and she will mentor them.
So the board is very involved, they will be getting regular reports. They've already gotten a report from us on the outcome of the assessments and our findings. Then they will be getting regular reports on the development plans for each of the leaders, and then they'll be getting quarterly updates on the development plans. So they're very involved, which we think is great because you want to have complete alignment from the board down through the executive team, down into the ranks for this really to be a successful leadership project.
That's wonderful. So obviously this client is thinking really thoughtfully about the next 6 to 10 years, making sure they are really prepared for the eventual succession scenario, but in the short term, what kind of benefits are they seeing even now before those transitions happen?
Each of the leaders talked about how they learned some things about themselves. They had some light bulbs go off about how I could do that differently in my own job? They had role plays where they had to work with an employee who was slightly disgruntled and it gave them some light bulbs about maybe I didn't do that as well, and maybe I can coach people in a different way or be a little more direct about giving feedback, maybe I soft-pedaled that a little too much.
So they learned things as they were going along, and then of course in the feedback sessions, they're learning quite a bit. And our lens is to learn about their specific role, what their challenges are as well as what they aspire to and give feedback in the context of their role and what they also aspire to do, whether it's within the development side, construction side, etc.
Great. So in the short term though, it sounds like they'll have some really nice performance acceleration in their current roles to help the business move forward. And eventually when those succession decisions have to be made, they'll be in a much better position than they are today?
That is definitely planned. And one of the things that they all remarked about is that they did learn about their job, but they also learned about the other expanded jobs. And they learned about what their CEO faces, and it gave them a special insight as to what he faces.
The other thing that it does as a by-product is they felt very loved by their company. They felt invested in, they felt like the company had honored them by putting them through this process and investing in them and allowing them this time. So it develops a greater valence and the emotional state toward the company that the company cares that much and is willing to invest that much in their development.
That's fantastic. Thank you for sharing this story. This is a really great story of a company building a strong bench for the long term. And I know a lot of companies out there are struggling with that today. So I appreciate you sharing.
Thank you, Beth. I enjoyed it.