FPMG Announces Reasons Leadership Transitions Often Fail

Share Article

The track record for leaders developed in-house is better than for those hired from outside the company ranks, but that doesn’t mean that failures don’t often occur. To assist leaders in being successful, FPMG, a performance management firm, has studied the reasons why leaders fail and announced its conclusions.

FPMG Announces Reasons Leadership Transitions Often Fail

FPMG Announces Reasons Leadership Transitions Often Fail

The decision to put someone in a leadership role can never be taken lightly.

According to a recent article in the Financial Post, the track record for leaders developed in-house is better than for those hired from outside the company ranks, but that doesn’t mean that failures don’t often occur. To assist leaders in being successful, FPMG, a performance management firm, has studied the reasons why leaders fail and announced its conclusions.

“The decision to put someone in a leadership role can never be taken lightly, and in fact, many companies have in-depth processes in place to screen internal and external candidates,” says Denise Federer, Ph.D., FPMG’s founder. “Despite this, research on leadership transitions doesn’t bode well for their success; the failure rate in the first two years is the same for both those recruited from outside companies or promoted from within: 40-60%.”

FPMG believes new leaders’ failures aren’t typically due to a lack of time or effort being put into the hiring/promotion decision, but may be the result of one or more of the following factors:

  •     Unclear communication/undefined hierarchy. This is more likely to occur in smaller companies, where some promotions aren’t even announced, leading to reporting confusion among employees.
  •     Lack of ability. People who are skilled technically may not necessarily be well suited to take on leadership roles, especially if they aren’t provided with management training.
  •     Poor environment/lack of empowerment. Upper management often fails to create an environment that adequately supports new leaders’ ability to achieve organizational goals.
  •     Misrepresentation. Regardless of how much due diligence occurs during the hiring process, people have been known to embellish their credentials and abilities.

When leaders fail, FPMG notes, it results in more than just individual disappointment; lack of success at the management level can have implications throughout the organization. The issues of wasted time and financial resources exist, as well as the potential for negative emotional impact on the entire company culture—especially when the leader in question has damaged morale and/or customer relationships.

“While leaders who fail must take some personal responsibility for what’s occurred, when one or more of the issues noted above are in play, upper management must be accountable for its failures as well,” Federer says. “There are plenty of actions that can be taken to support new leaders and help ensure their success that we’ll cover in a separate communication.”

About FPMG
FPMG is a Florida performance management consultancy dedicated to guiding successful people to be their best. Based in Tampa, we help you uncover the non-financial issues that impact the bottom line. FPMG offers consulting for family business problems, financial advisors legacy advising, leadership development, and more.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Denise Federer, Ph.D.
Follow us on
Visit website