An interesting article on the Stanford Graduate School of Business website examines three key reasons why a CEO perhaps should not have a prominent role in selecting his or her replacement. First, selecting a CEO is fundamentally different than hiring other top managers. The outgoing chief executive often has no experience selecting a CEO, while many board members may have that type of experience. Second, CEOs worry about their legacies. As a result, an outgoing boss may pick someone who will preserve his or her legacy, rather than someone who will make bold, but necessary, changes. Finally, people have a tendency to hire others similar to them in a variety of ways. CEOs may do the same when selecting replacements. I would add one additional reason. The outgoing CEO may not recognize the future needs of the organization. They may be looking backward at what has been necessary to make the company successful in the recent past (during their tenure). The outgoing CEO may not recognize that new challenges and opportunities await, and those issues require a very different set of skills and expertise.
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