You have handy it to Sir Elton John. Not solely is he the one musician ever to have top-ten hit singles in Britain for six a long time in a row. He can be a uncommon septuagenarian megastar who is aware of find out how to bow out in fashion. On November twentieth at a comparatively tender 75 years outdated, he carried out what he stated could be his final ever live performance in America at Dodger Stadium in Los Angeles. One of the showstoppers was “Goodbye Yellow Brick Road”, the theme music for sleek retirements. If solely Disney, who live-streamed the occasion on Disney+, had been listening.
It wasn’t, as a result of shortly earlier than the efficiency began, a bombshell landed. Its hospitality tent on the stadium was convulsed by the information that Robert (Bob) Iger, the Walt Disney Company’s personal Rocket Man, was popping out of semi-retirement, aged 71, to retake management of the agency he left solely 11 months beforehand, leaving Bob Chapek, his handpicked successor, out on his ear. It was startling. It shouldn’t have been. After all, as Jeffrey Cole, a communications professional at USC Annenberg places it, “Disney has had a 40-year succession problem”. During his decade-and-a-half as CEO, Mr Iger postponed his retirement 4 occasions, elevating and nixing potential successors. His predecessor, Michael Eisner, expensively jettisoned attainable replacements twice throughout his 21-year reign, earlier than lastly selecting Mr Iger. Disney’s board has now given Mr Iger two years—a deadline unlikely to be set in stone—to have one other go at discovering an acceptable inheritor.
Succession issues usually are not distinctive to Disney. In truth they plague company America, particularly when departing CEOs obtain close to legendary standing—apart from Mr Iger, recall GE’s Jack Welch and Howard Schultz, Starbucks’ barista-in-chief. Some high-profile CEOs cling onto energy for therefore lengthy that their companies seem to develop outdated with them: exhibit a is FedEx, the supply agency whose founder Fred Smith stepped down as boss in June after 49 years. There is a probationary air to some imperial handovers. Andy Jassy could have accomplished all the suitable issues to turn out to be boss of Amazon, however there may be little doubt Jeff Bezos, the founder, would swoop again in if the e-commerce large acquired into hassle. Then there are the leaders who’ve made their companies so iconoclastic they’re nearly irreplaceable: consider Berkshire Hathaway’s funding genius, Warren Buffett, or Elon Musk and his impossible-to-emulate best present on earth.
What makes it so exhausting to fill such outsized footwear? One clue comes from Mr Iger himself. It is hubris. In his memoir, “The Ride of a Lifetime”, revealed in 2019, he acknowledges that each one CEOs prefer to suppose that they’re irreplaceable. Yet good management, he provides, calls for the alternative. It is about bringing on a successor, figuring out abilities they should develop and being sincere with them when they aren’t prepared for the subsequent step. That is true. Yet what he doesn’t admit is that grooming a substitute is psychologically powerful. It brings leaders face-to-face with their very own mortality. It brings up the vexing query of legacy. Tellingly, Mr Iger writes nearly mournfully concerning the day in 2005 when Mr Eisner left Disney for the final time with no board seat, no consulting function—not even a farewell lunch thrown by his colleagues. “Now he was driving away knowing that his era was over,” he wrote. “It’s one of those moments, I imagine, when it’s hard to know exactly who you are without this attachment and title and role that has defined you for so long.” With such a bleak notion of company afterlife, it’s no surprise Mr Iger was loth to let go.
In concept, that’s the place robust, unbiased board members ought to have are available. It’s their job to deal with succession planning. While the CEO has a accountability to nurture layers of expertise inside the agency, it’s as much as the board to look at inner and exterior candidates and resolve on a substitute. In observe, nonetheless, A-list bosses usually dominate their boards. In Disney’s case, the administrators went so far as elevating Mr Iger to chairman in 2012 after his masterful acquisitions of Pixar and Marvel, two animated-film studios, sealed his standing as monarch of the Magic Kingdom. When Mr Chapek took over as CEO in 2020, the board continued in Mr Iger’s thrall. He remained government chairman till the top of final yr, reportedly nonetheless calling the pictures in ways in which undermined his successor’s authority. In June, underneath Susan Arnold, a brand new chairman, the board unanimously prolonged Mr Chapek’s contract, although by then his credibility was just about shot. Five months later, the board sacked him. It might barely disguise its delight at having its more-beloved Bob again.
For all such corporate-governance fiascos, some comebacks work. Mr Iger’s may. Jeffrey Sonnenfeld of the Yale School of Management likens his return to that of second-world-war generals reminiscent of Douglas MacArthur or George Patton, motivated extra by restoring Disney’s lustre than by private ambition. The day after taking again management at Burbank, Mr Iger swiftly got down to dismantle the centralising technique orchestrated by Mr Chapek, placing decision-making again within the palms of Disney’s creators. Mr Sonnenfeld believes the returning boss already has “excellent” substitute candidates up his sleeve. If he does, he’ll be capable of rectify the largest mistake in a largely blemish-free profession.
When are you gonna come down?
Some high-profile successions work, too, most notably the transition at Apple, maker of the iPhone, from the late Steve Jobs to Tim Cook, and, certainly, Mr Iger’s follow-on from Mr Eisner. In each circumstances, the brand new bosses succeeded first by not trashing their predecessors’ legacies and second by articulating a powerful imaginative and prescient for the longer term. Yet in the end an important factor could have been that their long-serving bosses, nonetheless celebrated, had by then left the stage. Long-standing financiers reminiscent of Jamie Dimon of JPMorgan Chase and Larry Fink of BlackRock; moguls, reminiscent of Rupert Murdoch, of News Corp; all ought to take be aware. Listen to Sir Elton’s ode to life after superstardom—and be taught. ■