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CEO Update LIVE: Getting, keeping and leaving top job

Show vision and optimism, but stay aligned with your board

CEO Update LIVE panel

From left, Stephanie Tomasso, Michelle Korsmo, Todd Hauptli and Bill Hudson.

Sept. 13, 2019
By William Ehart

Does the search committee really want what it says it wants in a new CEO? What are the most important traits of a chief executive? How much notice should you give of your retirement?

An expert panel of association leaders and executive recruiters answered those questions and more at CEO Update LIVE: Skills for the C-Suite, held Sept. 10 at the Fairmont Hotel in Washington, D.C.

The attributes that groups say they want in their next leaders are not necessarily what they really want or need, panelists said.

“A lot of times organizations will say, ‘We need someone who knows us, who knows our industry or our profession, who knows how we tick,’” said Stephanie Tomasso, executive recruiter with Russell Reynolds Associates.

“And I really push back on that. How important is that really?” she said. “Because there are a lot of transferable skill sets going from one regulated industry to another. Or if your key challenge is finding new revenue outside of dues, why do you need somebody who knows your industry or profession to do that?”

The other panelists were Michelle Korsmo, CEO of the $11 million-revenue Wine & Spirits Wholesalers of America; Todd Hauptli, CEO of the $76 million-revenue American Association of Airport Executives; and Bill Hudson, executive recruiter at Heidrick & Struggles. CEO Update Managing Director Mark Graham moderated the panel.

Hudson agreed that industry credentials can be overrated in association management.

Association boards “will often say they need someone from the industry (because it’s) very complicated,” he said. “Others will say we need an association person, and for others we’ll present a mixed slate of candidates so they can see the value of both.

“And they’ll see that one candidate stepped in from outside the industry and did very well at another association” and become convinced the executive can do the job for their industry too, Hudson said.

“They are looking for somebody to work with them and understand their association, maybe from outside the industry, maybe from inside the industry, who can help them understand trends and map out the future for them,” he said.

Forward, with confidence

Hauptli and Korsmo said vision—and the optimism to pursue it—are the most important traits in a chief executive. Korsmo is in her second CEO position and Hauptli has led AAAE for six years, after 22 years as its chief lobbyist.

“I would say optimism,” Korsmo said, in response to a question about most important characteristics from Graham.

“All of the other (traits) will fall in line. So much of what the CEO has to do now is help the industry see the future and figure out that path. Being optimistic about how you see that future is really key and the best way to be optimistic is to have a structure behind it, and one of the things that involves is having that vision.”

Hauptli put vision first and optimism second.

“You have to demonstrate that you’ve got this, that you see it, that you know the plan and you’ve thought it out,” he said. “It’s all about executing on it and aligning people around a common vision and set out to accomplish that. That requires a lot of optimism.”

Keeping the CEO position once you have gained it requires alignment with the board. Often, hiring organizations say they want change, but it’s important to define that.

“Change means something different to everyone,” Korsmo said. “The kinds of things a CEO would view as change are probably very different than what the board views as change.”

Korsmo actually went back to the WSWA search committee after it selected her to ask why she had been chosen. She created a vision for the group based on what she heard during and after the interview process.

“And then I spent a lot of time going out and testing that vision. I was on the road constantly at the beginning, going out and testing with my members whether that vision really resonated. And that requires a lot of really hard listening,” she said.

Losing touch with the board is a career risk for top executives, and is often the reason for short CEO tenures.

“CEOs fail because they are not attuned to what’s going on around them, what the pulse of the membership looks like and whether people are happy with the direction the association is heading,” Tomasso said.

But getting attuned in the first two years is not enough—you have to adjust your frequency as board seats change hands, she said. New board members can be dissatisfied even if they don’t know exactly what their predecessors asked of the CEO.

“Sometimes, the board that hires you completely transforms within the space of three or four years,” Tomasso said. “I would urge CEOs in those environments to keep a paper trail, and work to get that annual review done.” 

Job hopping?

One school of thought in the association sector is that executives—particularly CEOs—should move on after five or six years for the benefit of their associations and their own professional development.

But Hudson said executives also can demonstrate growth within their current roles.

“There’s an expectation for career growth and professional growth,” Hudson said. “(But) look at what Todd’s done with his association and the growth he’s had internally.” (AAAE revenue has increased to $76 million in 2017 from $17 million in 2013, the year Hauptli became CEO.)

“He’s had huge professional growth, he doesn’t need to change his position to have that,” said Hudson, who oversaw huge growth as CEO of the Global Cold Chain Alliance during his 32 years there. “Your professional life and your personal life have cycles, and you have to make sure it’s right, personally and professionally, to make a change.”

But Korsmo and Tomasso did emphasize that your leadership never should grow stale.

“Increasingly we are seeing that nobody can be in maintenance mode,” Tomasso said. “What was needed when you were hired five years ago may be totally different than what the organization needs today.”

“A really important thing for any CEO is that you have to have a constant fire in the belly about how you make it better,” said Korsmo, who led the American Land Title Association for seven years before joining WSWA in 2018.

Many associations have the same schedule year after year of meetings and appropriations bills and taxation issues, she said.

“As the CEO, you cannot let it be repetitive,” Korsmo said. “It really has to be about where are the challenges, where is the hard stuff, and how you are going to address it.”

Aspiring CEOs need to be sure that the top job really is what they want. The position may take you away from aspects of your current job that you find rewarding, and it can be lonely.

“Don’t put your name in unless you have prepared,” Hudson said. “Make sure you have that broad spectrum of (familiarity with) finance, technology, board leadership, all the things the CEO needs. Don’t think you can walk in and it will come magically.”

Hauptli said the constant travel and ultimate responsibility can take a toll.

“I would say be prepared to be a little bit lonely,” he said. “You end up being physically lonely, you’re traveling a lot, you’re becoming quite intimate with hotel rooms in strange towns.

“And there’s also the piece that as much as we try to be collaborative and transparent, at the end of the day, the buck stops in one spot,” Hauptli said. “You can’t always have a full conversation with the people who work with you and for you about every single issue. Sometimes you have to suck it up and make a decision, and that can be a little lonely at times.”

Tomasso also said CEO candidates should be patient and fully absorb the posted job description before applying.

“CEO Update will publish that we’re going to be doing a search for XYZ organization, and within 24 hours I have received a handful of resumes,” Tomasso said. “And we haven’t even put a position description together yet.

“We all know these searches don’t happen overnight. You’ve got a little bit of time to think about this. Send a thoughtful note that reflects why you are a strong candidate for this position. It is shocking to me how that does not happen very often,” she said.

The proper exit

Hudson said CEOs thinking of retiring should give adequate notice, but not too much.

“No matter how good you are, there’s some excitement about new leadership and a new stage for the organization,” he said. “And if you say, ‘I’m thinking about 2022,’ boy, it’s set in their minds. Then if you say ‘I’d like to work a couple more years,’ they say, ‘Oh, we’ve already talked to a recruiter.’”

Tomasso agreed, saying CEOs need to give adequate warning for a thoughtful search process to replace them but not so much that it sabotages their remaining tenure.

“Anything more than about 12 months’ runway is probably too much advance notice,” she said. “Just because it positions you in a way that may actually be counter to your own interests.”