What happens when industry leaders retire?

With 5 industry execs set to retire this year, HNN Editor-at-Large Ray Allegrezza contemplates what it will take to fill their shoes

Tom Conley of the High Point Market Authority, Roy Calcagne of Craftmaster, Jeff Scheffer of Universal Furniture, AICO’s Martin Ploy and John Conrad of the ISFD, have lots in common.

They have each earned and held top posts at their respective companies. They each are well-known and well-respected members of the home furnishings industry. And each has announced that they are retiring.

One other thing these five guys share is that they have each left their mark on their respective companies, and as they depart to experience the next chapter in their lives, they will leave a void that their successors will challenge themselves to fill.

While the changing of the guard will be noticed and felt by all of us in the home furnishings sector, this reshuffling of the deck is impacting businesses both nationally and globally.

Some time ago, I read an article in the Harvard Business Review by Dorothy Leonard, Walter Swap and Gavin Barton that spoke to the issue of the voids that often manifest when leaders leave their posts.

In preparation for their book, Critical Knowledge Transfer, the three authors interviewed dozens of CIOs, CTOs and HR managers about this topic and discovered that, often, key managers did not know what they had lost until after the top person had left the company.

The interviews also revealed that critical losses occurred in four areas: relationships, re-work, regeneration, and reputation.

Commenting on the issue of relationships, the authors were told that over the years, the key leader could pick up the phone and get whoever they needed to speak with on the line. As one manager told the authors, “Smart people know other smart people.”

So, when a leader leaves, it is important that the new person finds ways to hold on to those relationships.

It also became apparent that, in many cases, when the key person left, the company’s reputation took a hit, at least right after the leader’s departure.   

Based on that, it would seem prudent for the incoming leader to waste no time reaching out to key contacts to show that things are firmly under control.

The issue of re-work is also a red flag and one that can eat up time, money and resources.  Often, an incoming leader feels the need to revamp every system his or her predecessor developed.

While the authors agreed that a clone of the departing leader would probably not be desirable, even, if possible, they also warned about a new broom sweeping every corporate floor, just because it can.

Underscoring that point, the authors referenced one company that completely changed their internal financial reporting system, spending almost $6 million over two years, only to find that the system did not fit the practices of their widespread businesses. The investment was made without the guidance of the outgoing director, who had been with the company 30 years but had left and then died shortly afterwards.   

Apparently, the new director never asked the right questions of the company he hired to revamp the system.

Lastly, there was the issue of regeneration, which the authors concluded was the most expensive knowledge to lose. Defining regeneration as the capability to bring out the next new product, they concluded that while innovation springs from fresh thinking, it is also often built on years of experience and expertise with designing and producing a particular kind of product.

While I’m confident that the folks ready to take over for our ‘five guys’ have all the tools necessary to take their companies to the next level, they will have some big shoes to fill.

I want to wish Tom, Roy, Martin, Jeff and John continued good things and success as they begin to enjoy the next chapter of their lives.