CEO Succession planning in small community banks: A qualitative case study of a Pacific Northwest bank
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The research case study purpose was to explore a single chief executive officer (CEO) succession at a small community bank through a qualitative investigation to identify relationships between the succession planning process and consequences. The research questions investigated were to describe and understand various consequences and dimensions of the CEO succession planning process. The results can benefit a bank’s executive leadership and board of directors in developing effective succession plans. Two main frameworks form the research foundation, stakeholder theory and management practice of succession planning. These frameworks support that the outcome of CEO successor choice can have a substantial impact on the organization’s strategy and success (Berns & Klarner, 2017; Cragun, Nyberg, & Wright, 2016; Zhang, Wierschem, Mediavilla, & Hong, 2016). Lack of an effective succession planning process presents a challenge for these banks that are thinly staffed and have aging CEOs and executives. Data collected from questionnaires, interviews, and archival data were analyzed for themes and triangulated to describe how the succession planning process was effective or ineffective and the resulting consequences. The data supported that the CEO succession case was an effective, successful process that reduced the risk of unintended consequences to the organization. The emergent themes and major findings were initial vision of candidate, intentional communication during transition, successor cultural fit, and trusting relationships. Other small community banks can use the major findings for succession planning to reduce the risk of negative or unintended consequences.