When clothing retailer Lands’ End Inc. CEO Frederica Marchionni was forced out in September after just 19 months on the job, the company didn’t have a ready successor in place. So it did what many companies in such a position have done: it appointed an interim executive.
Except the interim CEO in this instance wasn’t one person. Lands’ End temporarily filled the role with its chief operating officer/chief financial officer and its chief merchandising and design officer — a two-person team. Weight Watchers International Inc. around the same time took a similar approach. After CEO James Chambers stepped down, the New York company turned to not one or two, but three people to take on the interim CEO job.
More often than not a single person acts as a company’s chief executive, but when an interim candidate is needed it’s not uncommon for companies to turn to multiple people to fill the role. Such a CEO-by-committee approach, however, isn’t ideal, say some succession planning experts, either on a temporary or permanent basis.
“On the surface of it, it appears to be an incredibly lame, Band-Aid, short-term solution to the leadership need that [Weight Watchers has] got,” said Robert Jordan, CEO of the Interim Execs, a talent scouting firm based in Northbrook, Illinois. His firm vets and deploys experienced interim executives.
So why do so many companies opt for this approach?
If a successor isn’t identified prior to a CEO leaving, the knowledge or skills required for the role might not lie with a single person. “In this way, the ‘collective brain’ will be smarter than any one of the individual members of the group,” said Karen Cates, adjunct lecturer of executive education at Northwestern University’s Kellogg School of Management in Evanston, Illinois. “This could be desirable in the short run, but it is not a viable long-term strategy.”
The demands of having to coordinate structure and accountability quickly become tedious, Cates said. Additionally, larger and more mature public companies often seek the more traditional leadership structure of a single CEO to appeal to investors.
“Largely speaking, in society we are familiar with the notion of a singular CEO,” said Elliot Ransom, co-interim CEO and director of school improvement at UChicago Impact, a nonprofit arm of the University of Chicago Urban Education Institute.
Since Ransom’s appointment in May, he admits there has been some trepidation among employees around the decisions he and his co-interim CEO, Margaret Walsh, make. “That is perhaps as much a part of the ‘interim’ portion of the role as it is the ‘co’ portion of the role,” he said.
Still, Ransom said there are some advantages to the arrangement.
Each of the co-interim CEOs, for instance, carries different strengths, expertise, connections and experiences, which Ransom said helps them make more thoughtful decisions when it comes to running the organization. “The decisions that we make are more completely thought through and are, I would argue, stronger and better for the organization than either of us would likely arrive at individually,” he said.
Ransom shared some advice on how co-interim CEOs can make the structure work:
- Act as if you’re the actual CEO, unless explicitly told otherwise.
- Ensure the message being delivered is unified.
- Reach joint decision-making when possible.
- Meet as co-interim CEOs often, especially if aiming for joint leadership and collaborative decision-making.
- Have the best possible relationship with the board, establishing their confidence in the co-interim leadership.
- Keep lines of communication open with the board.
As for his advice for boards overseeing a CEO-by-committee structure: “If you’ve selected individuals to take the mantle of leadership, you’ve selected them for a reason,” he said. In other words, respect their abilities and trust that they will know the best way to execute the responsibilities given. “If you create the space for that to happen, you’re going to allow those leaders to be more authentically themselves as leaders.”
Nevertheless, there are inherent differences in the qualifications of interim and permanent CEOs, according to Interim Execs’ Jordan. Both types of hires will need excellent experience, skills and a track record of success.
The biggest differences are location and industry:
- Location: The temporary nature of the interim position means they won’t need to live in the corporate headquarters location, unlike a typical permanent hire.
- Industry: The board might have a bias in favor of a permanent executive with industry experience, but they could also go for the opposite. A CEO with experience outside of a particular industry might infuse fresh ideas into the organization. For the interim, it’s usually not important to have experience within the company’s industry.
Lauren Dixon is an associate editor at Talent Economy.