One of the most difficult decisions for great leaders to make is that which has to do with when to bow out of their leadership position. It is such a difficult decision because it is not just about the leader but also about the organization and its people. If a leader leaves before it is right for him to do so, the destiny of the organization and its people may be put in jeopardy. Again, if a leader delays his exit, he may overstay his welcome and may be shoved out eventually. So, getting the right reading of the timing is crucial.
On Friday, May 24, 2019, Theresa May, British Prime Minister, offered to step down as leader of the Conservative Party with effect from June 7, but said she would remain in office as Prime Minister till July when her party elects a new leader to take over the reins of office from her. The announcement didn’t jolt any Briton or follower of British politics. The question before that fateful Friday had been “When will Theresa May be courageous enough to throw in the towel?” It was clear that her time was up. The Prime Minister had failed to deliver on her promise to the people; she had failed to meet the people’s expectations, so she had no choice but to leave.
Mrs May became leader of her party and consequently leader of the country following the decision of British citizens to exit European Union. Former PM, David Cameron, who had campaigned for the country to remain in the regional body, felt he had to leave for another leader to take the country out of EU thus paving the way for the emergence of Mrs May. But in her three years in the saddle, not only had Britain not moved beyond the point it was when Cameron departed, her handling of the whole process had polarized the country and cost her her authority as a leader. By the time it dawned on her that her time was up, she had lost the confidence of MPs and her Cabinet as well as the respect of members of her party and the general public. Theresa May started on a high but she is leaving on a low.
On January 17, 2017, about six months after her assumption of office, PM May addressed the country giving the steps she would take that would culminate in Britain leaving the EU by March 31 2019. At this point, she had most of the people behind her but her vacillation, indecision and politicization and personalization of national matters turned the people against her and her party. This weakened her administration. So weak has Conservative Party become under May’s leadership that Brexit Party, a party that was founded only in January this year, worsted May’s party in the European Parliament elections held between May 23 and 26.
May overstayed her welcome and as a result polarized her country and ruined her party.
Dr Erastus Akingbola
Dr Erastus Akingbola built Intercontinental Bank from the scratch in 1989, and nurtured it to one of the most profitable financial institutions in the country, becoming the first Nigerian bank to hit the N1trillion deposit mark. As of August 2008, Intercontinental Bank’s asset base was N1.7 trillion, its balance sheet size was N1.6billion, while paid-up capital was N230 billion. A tier 1 bank, it had 330 branches and 10 subsidiaries. It was the envy of other banks.
For a while, the Chief Executive, Erastus Akingbola, had played with the idea of getting younger and hungrier persons to take over the management of the bank but he kept pushing back until June 2009 when the Central Bank of Nigeria (CBN) took over the bank, alongside others, sacking the board and management.
The undoing of Intercontinental Bank was the global financial meltdown of 2008 which made it difficult for a number of organizations to honour their financial obligations to the bank. This shot up its non-performing loan profile and forced liquidity squeeze on it. Intercontinental didn’t see this coming because the leadership was comfortable. Akingbola had been the CEO for so long that it became too difficult for him to understand the importance of an outside perspective. The banks that survived the meltdown ill-wind were those with agile leadership who had no sense of complacency or fulfillment and took steps to mitigate the effect of the meltdown before it became apparent to all.
Like many entrepreneurs, Akingbola had a special attachment to the bank which made it difficult for him to let go when he ought to have stepped down. The well-decorated banker forgot that the life of a corporate entity is in stages and each stage requires different focus and different strategy to attain the next level. Those who fail to understand this usually end up with either a dead or a semi-conscious enterprise. Today, Intercontinental Bank, which was once a dominant force in the financial services sector, has become history. It has been swallowed up by Access Bank because of a leader who did not know when to say his goodbye.
Pope Benedict XVI
Pope Benedict XVI shocked the whole world with the announcement of his intention to vacate office on February 28, 2013 without any prompting from anyone. Many people were taken aback because of the widely-held belief that the appointment to papacy is a lifelong career, so resignation on whatever ground was, as it were, a taboo. But in his letter to the church announcing his intention to disengage from papal functions, Pope Benedict XVI said, “After having repeatedly examined my conscience before God, I have come to the certainty that my strengths, due to an advanced age, are no longer suited to an adequate exercise of the Petrine ministry.”
Unlike Cardinal Stanislaw Dziwisz, Pope John Paul II’s secretary, who was of the view that “one doesn’t come down from the cross,” Benedict XVI was of the opinion that being on the cross loses its essence if the one on the cross is incapable of performing his function on the cross. He had no intention of holding on to the papacy at all costs. He realised that leadership was a task to be performed, not a title to parade; a test to pass, not an emblem to bandy about; and a trust that must not be betrayed. So, he opted out because he realised that he lacked the capacity to lead the 1.3billion-member Catholic Church.
When is the best time for a leader to quit?
When you have achieved the target you set for yourself
Most leaders go into office with specific goals that they want to accomplish. Many of them also set definite time by which they want to achieve the set goals. Once the target is achieved, there is nothing more to wait for unless you want to set a new target for yourself and the organization. Goal setting is very important in leadership. Goals keep the leader on the go. Where there is no goal, energy will be low. Where there is no goal, leadership will not only be laborious and uninspiring, it will also be a waste of time for both the leader and the led. Without goals there will be no inspiration and where inspiration is lacking, dissipation of energy and resources is imminent.
So, once a leader achieves the goals he set for himself and there is no room to set new ones, it is best to take his leave. If he extends his stay he will become an irritant.
When you run out of ideas
Idea generation is the strength of great leadership. Leaders distinguish themselves through their ideas which result in solving problems. Ideas birth innovation and innovation gives organisations an edge. Without fresh ideas, there can neither be progress nor advancement, and stagnation will be the end result. Since leaders are appointed or elected to improve the lot of their organizations and people they lead, when they get to a point that they can no longer come up with ideas that can spur innovation, they have reached the end of the road and it is in their best interest to call it quits. If they opt to stay on rather than quit, degeneration will set in and collapse may be inevitable.
Theresa May, in her almost three years in office, tried a number of tactics to extricate Britain from the clutches of the European Union in consonance with the desire of the majority of her citizens but none worked. Since she was put in office to lead the country out of EU, she has no reason to continue in office having failed to do so, hence her resignation.
When you lose your passion
A passionless leader is an ineffective one. Passion is what makes people work out their hearts and go the extra mile for their organisation. When passion is high, productivity goes on the upswing and so does profitability. But when passion goes out, profit plummets. Passion usually flows from the leader. When a leader is passionate about the organisation, his passion ignites others’ passion and soon it becomes an organisation-wide phenomenon. But when the leader is not impassioned, there is nothing to energise others. So, when it gets to a point that a leader is no longer passionate about the organisation he leads or that he is more passionate about other organisations than the one he leads, it is time to say his goodbye.
Darwin Smith became the CEO of Kimberly-Clark in 1971 when the fortune of the company was heading downhill. He led the company out of the tight corner into prosperity and remained as its head for 20 years until 1991. What was his secret? Smith said, “I never stopped trying to become qualified for the job.” This means he was so passionate about the job that he kept learning new ways of doing what he was doing. His passion was unflagging and so was his organisation’s profitability. He eventually led the company that had existed for over a century without any remarkable progress into greatness because of his passion.
When the organisation outgrows you
Leadership at any level requires some skill sets. Leadership skills enable the leader to deliver on his mandate and keep the organisation a going concern. But business is dynamic and this dynamism calls for change of strategy from time to time. It is dynamic leaders that are able to sense a change in trend in an industry before it becomes apparent and they are the ones that are able to profit maximally from such changes. When leaders get out of tune with the realities of the industry in which they operate, the business has outgrown them. It means their skills are no longer adequate for the role they play. If they do not step down, they will drag down the organisation.
Before Professor Charles Soludo, former CBN governor, came up with his banks recapitalisation and consolidation agenda in 2006, Guaranty Trust Bank had gone to the market to raise fresh funds to shore up its capital base. So, when other banks were running helter-skelter after the CBN’s recapitalisation order, GTB had no cause to worry. The failure of many banks to raise the required capital led to their demise and cost their CEOs their jobs.
When you are so comfortable that you no longer feel challenged
Leaders should always feel challenged. Leaders should not get to a point that they feel they have done enough. When a leader feels he has done enough, it is best to throw in the towel because complacency has already turned in and he will merely go through the motion day after day. There won’t be any sense of urgency; there won’t be any urge to accomplish new things. When a leader gets to that point, his leadership has already ended.
Arsene Wenger, former Arsenal Football Club manager, in his last 10 years as the club manager did not feel challenged. Year after year, he won no silverware, yet there was no reprimand from any quarters. Unlike other managers who knew that their performance was being weekly assessed and that there would be consequences for any below bar performance, Wenger didn’t feel any pressure; he took everything in his stride. He was not performing and he didn’t feel bad about it. He kept on renewing his contract after every two years until it got to a point that the board of the club felt they had had enough of his non-performance and showed him the door.
Great leaders do not feel comfortable in unchallenging situations.
When your legacy is in the past
Leadership is progressive and never stagnant. Great leaders never stop developing themselves, that is why they keep improving on their performances. But when a leader is unable to beat his own records and all he makes references to are the milestones of the past, it means his best is in the past and there is nothing more that he can achieve. At that point, it is best for him to say his goodbye.
The best time for a leader to quit is before the need for it becomes obvious.