As chair of the Federal Reserve since 2014, Janet Yellen has had to make decisions amidst uncertainty over the health of the economy and inflation. But now she's facing another unknown—what will she do during her final months on the job.
Yellen's term ends in February and President Trump has nominated current Fed governor Jerome Powell to succeed her. It’s not a unique position. Indeed, short-termism is running rampant in leadership slots in politics and business.
With CEO tenure on the decline for the last two decades and several high-profile CEOs recently replaced, the challenges are fairly obvious: Do you plow ahead and implement strategies—or shift direction toward succession plans? “The most well-respected leaders are the ones who keep their focus until the end of the term, whether that end comes suddenly or as expected,” says Tierney Remick, vice chairman of Korn Ferry’s Board and CEO Services practice.
For many, that means continuing to drive the strategy, being supportive of the broader leadership, creating the most impact you have in your current role, and demanding the best of your talent. Savvy leaders are aware that their leaving will likely have ripple effects on other top leaders, who may be candidates for promotions.
Some see staying the course in a lame duck slot as a morale move, at its core. Leaders in today’s world face a high-level of uncertainty, and their ability to navigate around distractions, solve problems, and, perhaps most importantly, inspire their teams to do good work, will help them no matter whether they’re a lame duck or not, experts say.
The ultimate hope is that organizations aim for smooth transitions rather than sudden ones. Companies that embed succession planning in corporate culture tend to reap the benefits, ensuring that a company’s leadership will never have a void even during a sudden departure. “If the succession was a surprise, it has the potential to be rocky,” says Remick. “If the organization and the board has been very strategic around succession, then the opportunity to make the transition more seamless and less disruptive to the organization is higher.”