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David Werdiger's Familosophy

The Non-Family CEO

The non-family CEO

As a family enterprise matures, and often in the context of succession planning (or ageing incumbents), the decision to appoint a non-family CEO comes to the fore. Having made the decision to consider one, families ask the usual question: what do we want in a (non-family) CEO?

Perhaps they should turn it around and ask themselves: what non-family member would want to be our CEO and why? Putting themselves in the shoes of a prospective CEO makes it easier to reduce the risk in the hire and avoid setting the candidate up for failure.

For the prospective CEO, well-defined authority and autonomy is essential, as is the comfort that the role is not interim while the family works out the ‘real’ next CEO. The boundaries of the role are also essential. A family cannot expect an external CEO to also be burdened with family issues. That could be a huge distraction from their main role.

That means (a) the family governance must be in order, and (b) the family may also need the assistance of externals who have a focus on the non-business aspects of family.

Consider This: Is your family considering a non-family CEO? Do you have a clear delegation of authority as part of the position description? Have you considered how long the CEO might stay on the job and why?

Further reading: 

 Here is more on reading on family business succession planning.

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