How Coca Cola Got CEO Succession Planning Wrong
Despite being mentored by the previous CEO for over 10 years, Ivester failed to adopt his predecessor’s most valuable leadership skills.
While some CEO turnover is organic and inevitable, most can be attributed to faulty succession planning. When companies don’t take time to intentionally groom successors, they end up promoting the wrong candidate or failing to equip the right one. Despite its status as a global brand and giant in the consumer-packaged-goods industry, The Coca-Cola Company (Coca-Cola) is no stranger to issues with their succession planning.
After two years as CEO of Coca-Cola Doug Ivester retired. Unfortunately, during his time as CEO the beverage companies’ shareholder equity and overall earnings declined substantially. The former CFO despite being mentored by the previous CEO for 10 years failed to adopt his predecessor’s most valuable leadership skills. How could someone so strong as a CFO be so lacking as CEO? Unfortunately, it’s not an uncommon occurrence, and it’s a phenomenon that has been explained by the Peter Principle in the following case study.
SIGMA believes in ongoing learning and development. One of the most efficient ways to do this is to learn from the successes and failures of others. These cases highlight some of industry’s most powerful lessons in succession planning, drawn from the example of those who went before us.
Download SIGMA’s case on Coca-Cola’s CEO succession planning process to learn:
- How key concepts in management psychology apply to Succession Planning
- The value of communication between the board and the company
- The importance of having a Plan B
- The importance of having a proper Plan A
How SIGMA Can Help
Like Coca-Cola today, you can get succession planning right. We’re here to help. Over the last 50 years, SIGMA has worked with more than 8,500 private and public organizations to develop people’s potential and increase organizational effectiveness. We provide full-service succession planning, custom consulting, and a range of templates and resources. We also offer a number of succession planning workshops. To learn more about our solutions contact us directly for more information.