Slepin thinks these are good things to consider. “Are there people among the senior managers who can likely succeed you?” he asks. “If those people get hit by a bus, who can succeed them?”
It’s widely accepted in the industry that the best way to breed a capable successor is to “build your bench.” “You don’t want to be in a position where you have to fill a lot of senior positions,” says David Fitch, CEO of Atlanta-based Gables Residential, which manages 54,000 units nationally.
Cultivating talent to that point is a challenge, but over the past decade, a number of companies have stepped up their employee development programs. Front and center in this movement has been Houston-based Camden Property Trust, a REIT with more than 50,000 units nationally, which regularly over the past few years has been on Fortune magazine’s list of the best companies to work for.
Like many of the best-in-class apartment operators in the business, Camden cross-trains its potential leaders and exposes them to parts of the organization they may not otherwise have been exposed to. Maybe that means taking a good asset manager who doesn’t know about finance and putting him in the finance group. It will also expose these up-and-coming leaders to investors, shareholders, and analysts at NAREIT and other industry events.
“It’s all about picking the right people, grooming them, and figuring out what their strengths and weaknesses are,” says Ric Campo, Camden’s CEO. “We’re grooming the next generation of senior vice presidents and, hopefully, CEOs one day.”
At Chicago-based Equity Residential, a REIT with 132,699 units nationwide, chairman Sam Zell says the best way to groom young leaders is to throw them right into the fire. “You put these guys in a position where they aren’t in any way uncomfortable about coming to me and saying, ‘I don’t think we should do this,’ or, ‘We have a problem,’ or whatever,” Zell says. “I encourage everybody to get their hands dirty.”
4. Let Go.
Unfortunately, in some cases, the biggest challenge of implementing a transition plan can be the departing executive him- or herself. With so much personal wealth and legacy tied into a company, letting go of the reins is not easy.
