The Human Side of Succession ft. Mary O. Andrews

Fran: I want to start by expanding who this conversation is about. When we think about succession planning, we often think about the leader stepping back and the leader stepping in. But succession really affects everyone around a transition: the teams who are uncertain about what will change and what will stay the same, the clients who built relationships with specific people, vendors, partners, and strategic stakeholders suddenly navigating new personalities and dynamics. Mary, how do you think about who succession planning is for?

Mary: Fran, thank you. I am delighted to join this conversation. It is an important one, because the human side, the emotional dimension of succession, is often overlooked, underestimated, and costly to all of the stakeholders you mentioned, both in terms of the impact of change on human beings and the real financial hit to the desired outcomes of the transition. Succession planning is for every human being affected. It includes all the people you talked about. It includes the families of the employees. It includes the clients, the vendors, and the community. It includes the teams, because if a team member changes, fundamentally the team that will exist on the other side of this is a completely new team that has never existed before. The ripple effect is not to be underestimated. As they say in Star Wars, there’s a disturbance in the force.

Fran: Isn’t that so true? Nicole, from a people perspective, how do you think about succession?

Nicole: From a Chief People Officer framework, we look at the intent of succession planning from a risk perspective and a business continuity perspective, the foundation, the structure we have discussed in previous podcasts. There needs to be a structure and governance around it, to inform not just the process of selecting the right talent for the next round, but how to navigate the change for everyone involved. We provide perspective to the executive team and to the other stakeholders, on what the impact is, not just for us, but for everyone connected to the organization. What resources and tools do we need to bring to help everyone affected?

Nicole: At PBO, we like to stay in our lane, which means we reach out to strategic partners like Mary, who can come in and help support the human condition and the navigation of the emotional journey we may not have considered or have the bench strength to handle ourselves. We bring as many resources to support multiple levels in the organization, not just before the transition, but, often missed, after the transition, especially in acquisitions. After the deal is done is where the most impact can happen, and where the right partners can really help clients transition as well as can be expected.

Fran: That timing, before, during, and after, is so important. Getting clarity before, particularly on the emotional side, is really underestimated. Kristy, from your perspective on financial resources, talk a little about succession planning.

Kristy: Thanks, Fran. While it might not be a surprise to the three of you, the financial case for the human side of succession is clearer than most people realize. Even though we are talking about the human side of succession, there is a financial component to measuring it. Organizations across the U.S. and around the world that handle these transitions successfully have measurably better outcomes.

Fran: Succession really is systemic. It ripples through the financial lens, the team environment, how we work together, the emotional impact. Mary, I love that you said this is not just about the employees, it’s about their families and the uncertainty when things change. It’s a multifaceted, systemic approach when you look at succession.

Chapter 2: Letting Go, The Outgoing Leader’s Identity Work

Fran: Because we have Mary here today, I want to spend more time digging into the experience of the outgoing leader, because I think this is the most underexplored topic in succession. I have personally watched, navigating exits with clients, the grief that happens for a leader who has been in a very defined role and has related their whole being to that role. Mary, what do you see and how do you work with leaders navigating this?

Mary: That change becomes exponentially more challenging if the exit of the outgoing leader coincides with retirement. When you think about not just identity, but what exit means, retirement is a step closer to mortality. The grief is deep, around both their identity as a professional and their lifespan as a human being. One statistic that breaks my heart from research that has been done is that 75 percent of business owners who successfully sell their company and walk away with the financial nest egg they wanted profoundly regret selling, just one year later. I have seen that firsthand, with clients and with relatives, who do everything on the financial planning side but do not do enough to consider the new landscape of their life.

Mary: One helpful frame is, instead of relating to retirement as a line you cross, after which you are a week, a month, a year, or 10 years away from death, you intentionally design your Act III, the chapter from age 60 to 90 plus. Yes, you may retire during that time. But designing the whole 30 plus years as a chapter of your life can really help reframe what the outgoing leader is having to attend to emotionally.

Fran: I have watched that with family members. The ones who had a plan and had hobbies, and basically a 30 year trajectory after retirement, were way more fulfilled in the latter years of their life. We could talk for hours about that subject. There are some great books out there. I highly recommend digging deep, because whether you are a leader or not, at some point we will all be making a change in the way we work, and having a plan is so important.

Chapter 3: Loyalty vs. Respect

Fran: I want to talk about leaders and the question of loyalty within an organization. Particularly in small and mid sized businesses and in the nonprofits PBO works with, we see that people are deeply loyal to their leader. They are unsure or unclear about what loyalty looks like in transition when that leader leaves.

Mary: Fran, I like to make the distinction between loyalty and respect. It really starts with helping outgoing leaders understand that when they are the cause of significant change, and at the beginning of a transition people will feel like the change is being done to them, employees may continue to respect those leaders, but loyalty ends the minute there is a change in the organization. Employees are loyal to the experience they have of an organization. So in helping the outgoing leader and reframing for employees, the message is: you can still respect this leader. You can be upset, mad, or angry that they made this decision. You may even understand the decision. But loyalty is going to be built by the new team. There is not much carryover from loyalty to the old organization to loyalty to the new one. Outgoing and incoming leaders both need to be aware of that.

Fran: We talked about this in prior episodes. As a leader of an organization, the culture, the values, and the framework by which we all work together build the strong foundation for transition. We are not talking about loyalty to one individual. We are talking about respect for the individual who built the organization, and a shared commitment to a culture, mission, and vision that does not depend on one person. It is a group dynamic.

Chapter 4: The Peer to Leader Dynamic

Fran: Nicole, I’d love to hear how you think about peer to leader dynamics in the context of succession planning.

Nicole: There are a couple of things to note in terms of recovery time and ramp time from an emotional standpoint. There is this expectation when a new leader comes in and is dealing with peers that, because they know the team, business should just keep moving. But how do you separate from being a peer and move into a leadership position, separating what used to be leadership camaraderie from a reporting relationship? Especially with our clients who have been with their organizations for 30 years, it can be very difficult for the team to see this person in a different light.

Nicole: We try to calibrate teams so they are integrated into leadership in a multitude of ways, from the president level down through the employees, so that trust gets curated through many connections, not a single point of connection. We try to dilute the emphasis on any one player and look at the bigger picture of how to give the right exposure and create the right tone across the leadership team, so that team members continue to curate trust over time.

Nicole: One of the things we say a lot on the succession side is that, in my opinion, it is actually easier when a founder retires fully. It is harder when a founder stays on in some capacity, because the new leadership team is trying to navigate a founder who has been with the team forever, even though the role has been redesigned. It can create two different teams, the old regime and the new operating model that is trying to move and perform. The new leadership team is trying to establish themselves and a continuum of culture that will inevitably evolve. So we work with teams to navigate the founder who is finding their value in the next operating system, often on an earn out, while still being kind and patient and trying to get things done. That is the more challenging emotional situation, because it has a drip effect rather than being a clean transition.

Fran: Best practice is always to have clarity of role. As we are navigating change, that clarity and the communication around it to everyone affected is critical. Kristy, in terms of succession planning and the financial impact of that transition for the leader, what do you see when you are working with clients?

Kristy: The transition and the emotional disruption of an organization have real cost. They show up in turnover, productivity declines, and even client instability. It is not just an internal impact, there are external impacts as well. Some ways to mitigate those impacts are to plan ahead as much as you can and establish 90 and 180 day performance goals at the start of the transition. That gives you something concrete to measure against. Think about the entire organization, not just the outgoing or incoming leader, but the surrounding team and the clients affected. Internal surveys and 360 feedback sessions can be helpful tools to ensure the information you are sharing is landing the way you want, and to give you the chance to adjust as needed. Succession planning, and addressing the emotional side, impacts the entire organization. Measuring opportunities for success is really where I would lean in.

Chapter 5: Surveys, 360s, and the Difference Between Information and Feedback

Fran: Mary, we had some chat about assessments. I’d love to have you weigh in on 360s and surveys, and how you have seen them executed well.

Mary: For me, 360s and surveys, I call that information, not feedback. I have a strong belief that feedback is based on a partnering relationship, so feedback is a two way conversation. Assessments and surveys, when done well, are intentionally designed to ask a particular question, and designed in a way where the respondent has the ability to take ownership in the conversation. They avoid what is not best practice, which is anonymous surveys that end up serving as complaint sessions and pit managers against employees based on anonymous complaints. As we know from retail, if you have a bad retail experience, you’ll tell 10 people. If you have a good one, you’ll tell one. So surveys can be a starting point. They can identify patterns or pulses. What needs to be designed in alongside the data is the conversations between two people, between leadership and employees, between teams. The real relationship building and feedback happen in those conversations.

Fran: Nicole, talk about our approach when we are doing those surveys with clients, in terms of trying to get that two way feedback dynamic, because it is interesting, we are gathering lots of data and lots of viewpoints.

Nicole: What is important about what Mary just said, and how we approach it with our clients, is to understand what they are trying to accomplish. Are we after data points? Are we after true feedback? What is the success measurement and what is the goal we are trying to accomplish? Helping the client put the right language around that lets us pull the right lever. Is this a 360 because we just need a data pulse check? Then we use it as information, not feedback.

Nicole: Nine times out of ten, clients are conflating quite a few things, and there is a lack of clarity about what they are trying to accomplish. Just getting them to right size their objective is part of the advisory work. We don’t construct 360s ourselves, we like to pull in vendors who specialize, because if there is a certain level of work to be done, you want a subject matter expert who can curate the right questions. The same is true for any investment in teams, including coaching. What are we trying to accomplish? That clarity sets everyone up for success and puts the right guardrails around intent and business impact.

Fran: From some of the exits we have gone through, it would have been really useful to have Mary’s skill set to navigate the emotional journey teams were going through. When you are in the finance role, you are focused on the finance piece, and shifting back to the emotional side is a heavy load. Having Mary as a resource is meaningful.

Nicole: It is the drag and drift on talent capability. That is what I love about working with PBO, we look at the people impact and the money impact, and we coach our clients to look at both, because both are our largest assets and are scarce for many of our clients. A lot of times it shows up in the financials as you and I talk about, but the talent capability and the pace at which people get through, because they are emotionally navigating their own journey while also having to navigate their team, is where someone like Mary is critical. Most of our clients have never done this before, and they need the right resources to get there.

Chapter 6: Functional vs. Psychological Readiness and the White Space of the Org Chart

Fran: Kristy, you nailed it. There is a true cost to all of this. I want to shift now to the demands of the incoming leader, because we tend to focus on whether they are functionally ready, can they do the job. We spend less time on their psychological readiness. Mary, what does that distinction look like?

Mary: We might be talking about someone who has been a peer being promoted into leadership, or a new owner coming in as a new leader. When I look at the psychological readiness of leaders, I expand the topic out to who the organizational leaders are, and I would argue that everyone in the company is an organizational leader. If you look at an org chart, the boxes show what people are functionally ready to do, their job, their role, and the boxes that report into them show team functional readiness. But the biggest part of any org chart is the white space. That is where vision, mission, and culture exist and get cultivated, by every single person in the organization.

Mary: The skills needed in the white space are emotional intelligence, the ability to influence, to enroll others, to inspire. The information flow lives there too, what people doing day to day work with clients need from senior leadership, what senior leadership needs to hear from them. The single skill I would emphasize is the courage to have important conversations. A lot of conversations between people in an organization should be about the relationship, what is working and what is not. Most people default to what is comfortable, talking about content, project, and process. So my tip for every organizational leader is, on a weekly basis, ask: what are the important relationship conversations I need to take on, and when would be the right timing for the other person? Don’t rush, don’t postpone.

Fran: In our organization, we see informal leaders leading by example, and we see people stepping into the white space, driving mission, vision, and values even on projects they are not directly involved in. It comes down to culture. We have leaders throughout the organization, and that really shifts how we transition. Nicole, this connects to the psychological shift from peer to leader. Have you seen a way that works in organizations that is generally more successful?

Nicole: It runs the gamut. The teams that have done this well, to Mary’s point, have solid information flow and a real nurturing of what it takes to be a leader. The lanes are clear, the role designs are clear. Teams with strong foundational structures of role design, and clarity about how to navigate to those roles in a way that aligns to culture, can navigate the peer to leader shift relatively consistently. We are all capable of the human swerve once or twice, but the goal is consistency of demonstrated behavior in those roles.

Nicole: We tend to think about succession only at the executive or leadership team level, but there is succession in middle management and across many highly pivotal roles. The clients who do this well do not make large assumptions, they meet teams where they are, they have the right people in the right roles to help navigate peer to leader transitions, and they have leaders with strong emotional intelligence who can sit with their own awareness of the situation. It is a foundational build, an investment in people that keeps succession top of mind as a high priority. We are continually building bench, and change is constant, which is counterintuitive to many people. They feel like a decision has been made for them when we make succession changes. As you and I have said, when buyers and founders sell, we have effectively just selected our team’s new employer for them, which does not feel great at the employee level. Be conscious of that at every level. You can be a role model and a leader at any level. If I were to pull one action item: make sure you have the right foundational structures in place for role clarity and the right resources to navigate succession.

Chapter 7: Readiness, Standards, and High Performance

Fran: Mary, role clarity is critical, and we are always trying to attract the right kind of talent to navigate change. Succession is one change, but organizations are constantly evolving. As a coach, and someone who has competed at the Olympic level, what patterns do you see in high performers with the emotional intelligence to navigate this kind of change?

Mary: I really like the focus on the word readiness. As a coach, I often work with executives preparing or planning for something, and they spin out a lot, spending time on getting themselves ready. I have them split apart their readiness as a human being to be the leader, and the prep moves much faster when those are separated. With that in mind, looking at readiness for them to be leaders is very much on the human side. Human beings are complex, and the dynamics between human beings are even more complex. So high performance is really the result of three things. First, attending to my own well being as a leader, foundational. Second, holding the standards of excellence, the vision, mission, and desired culture. Third, being able to navigate the complexity of human dynamics.

Mary: A great leader is ready when they can speak to the truth of the desired culture, the vision and mission and the promise of life on the other side of change, and also meet people where they are at, in the actual experience of the current reality. You have to speak the truth of both. The human brain hears a leader talk about the promise of the future while the listener is being told their job is changing, and there is a disconnect the brain cannot handle. Leaders have to be ready to speak to both the ideal and the current reality, and to walk with people emotionally to navigate that path to what is on the other side of change.

Fran: Kristy, Mary talked about readiness. There is the human impact of readiness, but there is also the financial. How do we provide leaders with financial readiness for a succession plan?

Kristy: It is not just the leaders we need to ready, it is the entire organization, and that involves letting go of loyalties to the outgoing leader, building confidence and respect in the incoming leader, and acknowledging the financial consequences that come with organizational readiness. Loyalty to the outgoing leader can manifest in voluntary turnover six to twelve months after the transition, when people simply could not transition themselves to accept the new leader. You can manage and adjust around that. One simple lever is to add a question to your exit interview about the transition, so you can pinpoint where communication missed, address it now, or build the lesson into the next transition plan.

Chapter 8: Normalizing Change and Communicating Well

Fran: In organizations, we are constantly evolving. Succession is a big change, and human beings approach change with difficulty. There is uncertainty, discomfort, identity disruption. Mary, how do you coach leaders and organizations to normalize the impact of change?

Mary: I appreciate you using the word normalize the impact of change rather than get comfortable with change, because we don’t expect people to get comfortable with it. Change when personally chosen can feel empowering and exciting. Organizational change is challenging. Individuals not involved in the decision typically experience the feeling that something is being done to them, even when they understand the need for the change. So as coaches and consultants, we support individuals navigating organizational change they did not choose, and we also support those who chose it, because they don’t always know the totality of what they chose. Accepting personal discomfort increases the odds that people can embrace the promise of what is on the other side.

Mary: Statistically, 80 percent of people will ride the fence to see where the change goes. About 10 percent are gung ho and ready to move forward. About 10 percent are resistors who are never going to embrace it, whether they leave or stay. The 80 percent are who you support, allowing their humanity, helping them choose what is available on the other side. That increases the odds of a successful transition and decreases both the emotional cost and the financial cost.

Fran: What is impactful in big change moments is communicate, communicate, communicate. We have to keep talking to each other, because the people on the fence need help thinking it through and sounding boards. Nicole, what do you also recommend for navigating and normalizing change?

Nicole: From a Chief People Officer lens, I immediately go to org design, designing teams in a way where agility and adaptability are part of the cadence. Whether through product design, project rotation, or other means, give them the opportunity to practice the muscle of identifying, communicating, integrating, adapting. Being adaptive is part of the culture. Especially as we move into this new era of AI, which is a whole other bottle of wine, we need to understand the skill set we are trying to develop, not just for managers, but for individuals across the organization. What is the real skill we need so that adaptability is not a one time muscle?

Nicole: Things change all the time, and recently it feels like we are in an accelerated race. Normalize that it is okay to go at your own pace and to adopt things in real time. I see the same pattern Mary identified, the 10 percent gung ho, the 10 percent resistant no matter what, and the 80 percent waiting for indicators. It is a lot of small reps done well. The other thing that falls down often is that people think they are entitled to know everything at every part of the organization. Sometimes that is just not how it goes. Navigating that, and admitting when you don’t know the answer as a manager, is okay. So set management teams up for success on talking points and difficult conversations. From a design perspective, normalize agility in everything you do, so that when bigger changes come, you have muscle memory to flex into.

Fran: We all need to give ourselves a little grace, particularly in succession. We have all been through more of these than most people because we are consultants, and even great integration plans don’t go exactly as planned. Staying curious, communicating, over communicating, and being willing to adjust to the reality and pivots is really important.

Nicole: I want to circle back to something Mary said earlier, the weekly pulse check with your teams. Knowing your people, because work isn’t the only thing happening in their lives. If this is one of a thousand changes happening for them, they may have more tolerance at one time in their life than another. That pulse check, knowing what their needs are at a human level, helps personalize the transition for the team you are managing. The human condition: work isn’t the only thing going on. Be sensitive to that and aware of it. Pulse checks are revealing in those moments.

Chapter 9: Emotional Intelligence in Execution

Fran: We are all human beings, such a good reminder. Mary, in the context of human beings and emotional intelligence, what do you see as emotional intelligence in the execution of a succession plan?

Mary: Whatever the change is, there is the human side of it. The pathway from the news that there is a big organizational change to the promise of the future on the other side is not a straight line. Human beings will be shocked a little or a lot, and the news will trigger most people into the fight or flight part of their brain. Productivity goes down as people process the news. The emotional intelligence here is for leaders to attend to every part of this roller coaster. What I see often is leaders willing to do this for a while, then they get impatient. So part of the work for leaders is being patient, because they have had this information much longer than most of their stakeholders. Always ask: what news can we share, who can we share it with, and just keep doing that throughout the whole process, not just until they are impatient.

Chapter 10: Mary’s Closing Reflection

Fran: My gosh, isn’t that true. You’re talking to one of the most impatient humans on the planet, and my daughter would agree. We are running short on time, so I want to spend a little time with you, Mary. Given your distinct background, Olympic level competition, business owner, years of coaching leaders and organizations through transitions, what does your work in this space actually look like, and what do you see that the rest of us miss when we are in the trenches?

Mary: I’m not sure what all you are missing. What I appreciate is how much you understand the value of the deep work associated with professional business and life coaching. As someone passionate about performance, I believe succession planning is ultimately about the intersection of people and performance. It is a human experience, and every stakeholder needs the emotional intelligence to navigate the change, and what I call HI, the human intelligence to know how to bridge from their emotions to what they are committed to. Organizations that design EI, emotional intelligence, and HI, human intelligence, into succession planning, alongside AI, become a living commitment. That is what produces what is promised on the other side of change.

Mary: The integrated approach you talk about is really important. The organizational culture will be different. Who is in charge will change. But the fundamental fabric of high performance, the work I do with clients who want to play big, is built on well being, strong and caring relationships, and standards of excellence. That is what will thrive in the next chapter of an organization’s existence. My final words: it is not enough to understand the humanity of succession planning. It takes rigor to do the deep work, to attend to the actual experience of stakeholders and the dynamics between human beings. For me, it is an honor and a privilege to coach individuals, partners, teams, and organizations willing to take on this rigor in order to win.

Closing

Fran: Wow. I agree. That is the most sage wisdom we can have in this episode, and this conversation has tied together everything from our previous podcasts on succession planning.

Nicole: I think you just have to mic drop on that.

Fran: Mary O. Andrews, our own Kristy Facchini, and Nicole, thank you. If you have any thoughts about a thoughtful leadership transition, please take a look at this episode and the others, and visit pboadvisory.com. It has been such a pleasure. We are going to have to do this again, more to discuss.

Nicole: Yeah, thanks for joining us, Mary.

Kristy: Love it. Thank you.

Mary: Thank you, it’s been a pleasure. Great conversation.

Fran: Great conversation. Thanks, everybody.