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14 14 CEO/STRATEGY HBR: Why Companies With Visionary Leaders Rarely Have Visionary Successors By Tamara Rosin L eaders like Bill Gates and Steve Jobs are renowned around the world for their innovative genius and in- spiring leadership styles. But their successors — not so much. Despite Microsoft and Apple's continued growth and success, neither company's current leaders have demonstrated an aptitude for imagination on par with their predecessors, according to the Harvard Business Re- view. After heading Microsoft for 25 years, Mr. Gates handed his title to Steven Ballmer in January 2000, who served as CEO for 14 years. Mr. Ballmer tripled the company's sales to $78 billion and more than doubled profits from $9 bil- lion to $22 billion, according to the report. The company also launched Xbox and Kinect and acquired Skype and Yammer during his tenure. In terms of revenue growth, Mr. Ballmer was top notch. But in terms of long-term survival, he was a failure, according to the report. The problem was Mr. Ballmer organized the company around the execution of its current strengths: Windows and Microsoft Office. As a result, it lost to Google in search, to Apple in mobile operating systems, to Netflix in media and to Amazon in the cloud. By 2015, out of the 2 billion smartphones out there, Microsoft's mobile OS share was 1 percent, according to the report. One of the many strengths of visionary CEOs is they de- velop an executive staff filled with top operating execu- tives. When Mr. Jobs was CEO of Apple, he led the vision but placed strong operating executives throughout the company — in hardware, software, product design, supply chain and manufacturing — who then translated his vision into new products and services. The problem arises when it is time for the visionary CEO to depart. Most often, the outgoing CEO appoints one of the operating executives who reported to them to run the company, as in the case of Microsoft and Apple. Usually one of the first things these operations/execution-minded CEOs do is try to eliminate the chaos in the organization, as they value stability and process. While this helps ensure predictability, it can be a death sentence for creativity, according to the report. Cre- ative people leave the organization and a cultural shift de- scends from the C-suite: What used to feel like a company out to change the world begins to feel like any other job. Visionary CEOs err when they select execution executives for their successors. They confuse execution with passion and market insight, but these traits are the not the same — for long-term survival, the latter is more valuable, accord- ing to the report. n CEOs Underwent 'Generational Overhaul' After Economic Crisis: 4 Takeaways By Mackenzie Bean A new report from e Conference Board, a New York City-based business research association, shows many older CEOs le their roles as heads of S&P 500 companies in the years aer the financial crisis. Now, this trend is leveling out, indicating a 'generational overhaul' in C-suites throughout the U.S., according to e Washington Post. Here are four things to know about the re- port's findings. From 2009 to 2014, a quarter of S&P 500 CEOs age 64 and older le their jobs, compared to just 8 percent of younger CEOs. ese figures include both retirements and forced exits, ac- cording to e Washington Post. Researchers note this gap was much larger af- ter the financial crisis than in the eight years before it, according to the report. From 2001 to 2008, the average CEO turnover percent- age was 16 percent for older leaders and 11 percent for younger CEOs. In 2015, the turnover gap between older and younger CEOs decreased considerably, ac- cording to Matteo Tonello, a managing direc- tor at e Conference Board. Mr. Tonello said it's difficult to deduce exact- ly why companies made this shi. However, given its timing in relation to the financial crisis, he believes boards may have felt pres- sure to hire a younger generation of leaders to switch up their strategy, according to the report. "Over the course of a few years you practical- ly have an entire generation of CEOs exiting the S&P 500," he said. "e financial crisis gave an opportunity to boards to refresh their management suites." n What used to feel like a company out to change the world begins to feel like any other job.