In most cases a graceful exit, in which the founder leaves the organization completely, is the most appropriate way for an organization to manage the transition from a founding or long-time chief executive.  In many cases, the fears about potential problems if the founder stays are well-founded.  Violating this conventional wisdom takes significant effort and invites some predictable risks.
 
However, the conventional wisdom about founder transitions has taken on the character of an absolute rule.  Most boards, executives, and consultants do not seriously consider the potential benefits of having the founder stay on in a substantial role.  Consequently, they overlook the considerable opportunities that are lost when they discard such a valuable asset.  

To explore these often missed opportunities, MAG conducted a study, Table for Two: Can Founders and Successors Co-Exist So Everyone Wins?, on situations where the value a founder brings to the organization makes it worth the risk and effort to find ways for the founder to stay on in a permanent role or to have a significant period of overlap with his or her successor.  These situations can occur because:

• Many founding executives have a huge amount of talent, experience, wisdom, energy, institutional memory, and connections that could continue to be used in the service of their organization.

• Keeping founders more involved for longer periods may help organizations that have not developed adequate second generation leadership or succession plans to navigate the transition to new executive leadership. 
  

• When faced with the choice of leaving completely or staying on as CEO, some founders may delay stepping down as CEO long beyond what is good for them or their organization.  (This is especially true when inadequate retirement planning or an economic downturn makes retirement less possible.)

Table for Two found that there are specific conditions under which a founder and new executive leader can co-exist — maximizing the founder’s assets for the overall good of the organization and reinforcing one another’s success in their new roles.  


What Table for Two Provides
Based on in-depth analysis of six cases of successful co-existence, Table for Two provides:

• A new, innovative model for leadership transitions.
• A broader range of options for the founder’s continuing role and contributions.
• Insights into the personal and organizational factors needed for success in such transitions.
• An integrated approach to weighing and managing the risks and benefits if the founder stays on.
• Challenges, coping strategies, and recommendations for founders, successors, boards of directors, and staff.
• Recommendations for funders who wish to support this kind of transition.

Wondering If This Makes Sense for Your Organization?
Consider if your organization, founder, and potential successor have the characteristics that make it possible for a founder and new leader to successfully co-exist.

Organization Does the organization have the characteristics necessary -- including an organizational imperative -- to make it worth the additional time and effort? Learn More

Founder Is the founder prepared to deal with the inevitable loss of centrality, importance and positional power that comes with stepping down yet staying on? Learn More

Successor Does the successor have what it takes to fully assume the authority of their role when the founder is still involved? Learn More

Want to Learn More?  Visit Table for Two or download the Summary of Key Findings or Report to help you explore these key questions and deepen your understanding of how other organizations have implemented this model.

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About the Author

Mark Leach is a researcher and management consultant with a particular interest in strategy, leadership development and transition, and issues of diversity and inclusion in organizations.  As a consultant and coach at the Management Assistance Group, he has worked with a range of social justice nonprofits and funders, primarily in the civil liberties, reproductive health, and environmental arenas. Prior to joining the Management Assistance Group, Mark worked as a consultant and researcher in nonprofit and private-sector settings.  His work has covered international development, inter-organizational collaboration, and diversity and inclusion in organizations.