Developing leaders with 2020 vision: companies can develop deep, enduring bench strength by combining succession planning and leadership development to create a long-term process for managing the talent roster

The recent tragic death and swift replacement of McDonald's Corp. Chairman and Chief Executive Jim Catalupo has been cited as an event that "could become a textbook case on solid succession planning" by Carol Hymowitz and Joann S. Lubin, writing in The Wall Street Journal. Just hours after Catalupo's demise, directors announced that Charlie Bell, the president and chief operating officer, would take over as CEO. Few companies are as prepared--not only for such an unexpected change-in-command, but even for one given more lead time. Much has to do with proper advance preparation and planning.

Consider the succession woes at these well-known companies:

-- M. Douglas Ivester, The Coca-Cola Co.'s longtime CFO and second-in-command to CEO Roberto Goizueta, served only two-and-a-half years as CEO following Goizueta's death, when he was forced to resign due largely to a perceived insensitivity in dealing with people and external relations. Coca-Cola recently named a retired executive, E. Neville Isdell, as its new CEO after electing to replace chairman and CEO Douglas Daft.

-- Mattel Inc.'s Jill Barad had an impressive track record in marketing that catapulted her into the top job--but didn't give her insight into the financial and strategic aspects of running this large global corporation.

-- The Walt Disney Co.'s board of directors and shareholders are currently expressing concern that their once "golden-boy" CEO, Michael Eisner, has stayed too long at the helm and has largely failed to develop adequate bench strength for succession.

These talented leaders failed, in part, because although each was accomplished in at least one management area, none had mastered more general competencies such as designing and managing acquisitions, building consensus, public relations or supporting multiple constituencies. And, they are not alone. The problem is not just that the shoes of the former chief are too big, but that leadership development and succession planning, as traditionally conceived and executed--when it is in process--is often too narrow and hidebound to uncover and correct skill gaps that can derail even the most promising young executives.

Why should a firm appoint a CEO or CFO without a vision for its long-term future? What could be more vital to a firm's long-term health than the choice and cultivation of its future leaders? And yet, while companies maintain meticulous lists of potential successors who could step into the shoes of a key executive, an alarming number of newly appointed leaders fail spectacularly by using skills and perspectives that were ideal for their old jobs but not appropriate for their new assignment. These are but a few of the leadership succession issues facing today's...