Passing the torch at Northlich Inc Featured

8:00pm EDT May 26, 2008

Mark Serrianne describes

Northlich Inc. as his

life’s work. His career at the $19 million advertising and

public relations firm began in

1974, and over the next 23 years,

he worked his way up to the

top, becoming Northlich’s CEO

and majority owner in 1997.

But all good things must come

to an end, and by last year,

Serrianne was ready to leave

the company’s top post and

assume the role of chairman.

However, it’s not as simple as

just stepping down. When the

time comes to pass the torch,

you need involvement on many

different levels to make the

transfer of control a success.

Paving the way for a successor takes planning and team-work from the outgoing CEO,

the incoming successor and

employees throughout the company. The more people know

and understand what is going

on, the better off everyone will

be during the changeover.

Smart Business spoke with

Serrianne about how to approach

succession planning in a way

that benefits everyone in your

company.

Q. How do you set the stage

for a successful transition of

control?

There are three or four kinds

of very vital components that

you work to put in place to successfully transfer control of a

company. When I say successful, I mean you want to keep

your culture and reputation in

place and maintain the stability

of your business.

No. 1, you want a high-performance leadership team with

an acknowledged leader in

place. No. 2, you want to have a business model that is working

and performing well and is a

strong foundation for a new

leadership team to spring from.

No. 3, having a clarity of vision

in an environment that fosters

fresh ideas. In our world, it’s all

about change, so having a clarity of vision and an environment

that fosters that is very important.

A fourth point is shared values. ... I think when you’re looking to transfer ownership and

plan for succession, you want to

have a leadership team that

shares in those values.

You have to breathe life into

your vision. It’s not something

you occasionally breathe life

into. You have to actively

breathe life into it by forming a

plan of objectives, goals,

strategies and even measures that are very clearly

articulated. If you have

that, you are definitely

breathing life into that

vision. If you have consensus around that

vision, you have a kind of

leadership unanimity

driving that plan.

Q. How do you choose

the right successors?

You need to ask questions and make observations of the traits you’re

trying to identify in your

hand-picked successors.

You ask questions, but

there are also observations that you, as a CEO, are

making at the same time.

The No. 1 trait is having a fire

in their belly. It’s your legacy

that they’re carrying forward as

well as building on their own.

Secondly, they need to have a

tolerance for risk. When you’re

buying a company, you’re pretty

much putting your livelihood on

the line and you’re taking on a huge responsibility to look after

the livelihood of others. There is

no going back once you’ve purchased a company. Thirdly, they

need resilience. ... Another one

of the observations you look for

in successors is sort of a raw

creativity and high standards —

high standards about our work,

high standards about our people. And a last point is having a

really great intuitive judgment.

Street savvy is another way of

putting it.

How do you formulate those

observations? When you have a

business where your teams

work so intimately together,

when you have multidiscipli-nary teams actively working

together, you’re able to observe how people lead, how they

respond to high-performance

needs, intense timetables,

demanding client requests and

the ability to inspire and lead

others. When you’re working

together that intimately, the

cream rises to the top.

You’re observing so much and

experiencing so much when

you’re working with these people closely, you see the results,

what are they delivering, how

are they training and growing

people under them.

Q. What do employees and

clients want to know?

Employees want to know

what the outgoing CEO’s role

will be. The reaction from people during an ownership change

kind of covers the whole range.

On one end, people are going to

be thrilled knowing there is going

to be a passing of the baton. On

the other end, people are going

to be nervous. People want to

know in succession planning

that the leaders are going to be

available. When I say people, I

also mean clients. Clients want

to know that you are going to

be available to coach, to be a

connector and an ambassador.

Q. How do you ready yourself

to relinquish control?

Transferring ownership of a

company you’ve led for so long

can be difficult. But transferring

ownership is all about creating

opportunity for others. Organizations need fresh ideas, and you

want to build and sustain what

you helped create. A smart owner

has to be intuitive and know

when the timing is right. You just

have to be brave enough to know

when to get out of the way.

HOW TO REACH: Northlich Inc., www.northlich.com