It is often difficult for a qualified executive seeking a new career to bypass the established hierarchy of a company’s leadership team and gain a position as CEO. Prior knowledge of the corporation, years of dedicated service, and personal connections with the executive team make internal managers the natural selection for executive positions. In recent years, however, major corporations have begun to realize that internal promotions often lead to favoritism and resistance to change. Over the last 20 years, the hiring of outside CEOs has gained traction: today almost 10% more CEOs are mined externally than in the 1990’s.
Difficulties Faced by an Outsider CEO
The major drawback of hiring an outsider CEO—disregarding the time it takes to learn the business metrics and acclimate to the company culture—is internal resistance to change. Board members often hire outside executives to change a company’s structural failings, but those same leadership teams sometimes resist when a new CEO attempts to enact said changes. This dichotomy can make it difficult for outsider CEOs to work effectively. It may also destabilize the job security of an externally hired executive, making them less likely to take risks for the greater good of the company.
How Outside CEOs Effect Positive Change
Studies from MIT and the Harvard Business Review have noted that under certain conditions, an outsider CEO can be as effective or more effective than an internal CEO. Conditions for an external CEO to succeed include:
- A company in crisis, or a business in need of internal changes
- Prior knowledge of the company’s culture and infrastructure
- A CEO who shares the company’s vision
- No acclimation period under the former CEO, which can make a new executive feel beholden to the old leadership
- A new executive team who won’t resist changes within the company
- A CEO candidate who does not make immediate changes, but recognizes the immediate and long term fallout of changing the direction of the company
When it comes to succession, many companies are becoming more open to hiring outsider CEOs. Showcase your talents, your drive, and your dedication to success with a professionally written executive resume crafted by the career advancement experts at Executive Resumes Atlanta.