Q009
What if there’s
An Emergency?
our take .
When Permanent Equity first got serious about succession planning with our portfolio companies, the common first question was about timeline. Leaders wanted to know which of the following questions they were being tasked with answering:
How would the business run without you tomorrow? (1-6 months)
What are the key hires to make so the business could continue running on the same course? (1-5 years)
What needs to happen if you’re planning for growth, directional change, or other long-term goals? (5-15 years)
Frankly, our answer was “Yes.”
Of course, it’s challenging to optimize for the short- and long-term simultaneously, but since the future is unknowable, it’s helpful to know you can pivot, if needed. But at the very least, we need an answer for the “break glass in case of emergency” scenario.
Emergency succession is a fundamentally different mode than a well-intended mid- to long-term plan. We’ve had it go well, and not so well. It can be triggered by tragedy, or by bad actions. And, by the nature of being an emergency, it’s never going to be the ideal plan.
Because emergency changes are going to catch everyone off-guard, there’s a higher likelihood of emotional volatility among the team and in communication. That reality contributes significantly to the skillsets required to lead through such a period. Depending on why the transition needs to take place, swift intervention may also be required. The point is, it’s going to be difficult to hide that this is crisis management, not business as usual.
When tragedy strikes, it is invaluable to have a set of instructions that enables people to do what needs to be done, while not discounting or depressing their emotions. This can be as simple as a template announcement and notification chain in the case of a death, and as thorough as a departmental-level crisis plan set and a process with the family or trust to manage through crossover communications. As awkward as it is, the lens is to consider how you would want to support people if you’re not there to do it. Just in case.
In the case of bad actions, the communicator of change needs to be someone who can be trusted. Hopefully, that’s someone who is already a part of the team. In most cases, detailed reasoning for the shift will be highly confidential, making that person’s known character all the more imperative.
But crisis management and long-term leadership do not have to be a unified decision. Interim leadership should be the default in an emergency. Making long-term leadership decisions should rarely be done quickly, as this series has hopefully made clear.
on paper.
character to consider: Henry VI
From Warrior King to Unprepared Heir
Imagine: Your highly capable, charismatic ruler (uniter of England and achiever of military victories, writer of stirring speeches and connector to the common man) dies unexpectedly, leaving a supposed heir who’s little more than an infant. What’s more, an infant saddled with enormous expectations and a legacy impossible to uphold. The transition from Henry V to Henry the VI is fragile, to say the least. Without specific instructions on what was to happen should something happen to him, Henry V left his son and heir dependent on regents and advisers, who were often more interested in personal gain than in protecting the kingdom, in the midst of immediate political chaos.
Lack of Clear Guidance and Vision for the Future
With no guidance or long- or short-term plan for governance, there was no plan for the future of England, so newly united and tenuously held. It seems strange to talk about a “vision” for a nation, but in this botched transition, Shakespeare presents a court and country running only on who is able to grab power and hold onto it – the fatal flaw in an unprepared heir unexpectedly inheriting a throne from a particularly strong, independent king. In the power vacuum, supposed advisors like the Houses of York and Lancaster, laying the groundwork for the Wars of the Roses, pursued short-term gains.
Internal Conflict, Competing Factions + Fragile Foreign Alliances
With a child on the throne, England's nobility pounced on supposed and actual vulnerabilities, fracturing into factions, vying for influence and control. Newly gained territory in France almost immediately falls back into French hands, the English troops themselves know the monarchy is tenuous, the vultures start circling almost immediately. What’s notable about the aftermath of Henry V’s unexpected death is how quickly the pathology sets in and the rapidity with which things fall apart. From The Hollow Crown: “The interests of England are ignored or subverted by a flawed elite consumed by their competition for power at the expense of their country’s needs. The kind does not understand them and cannot control them. The patriots, like Talbot or Gloucester, are carried off by the accidents of war or by their own naivete in the face of wilier aristocratic rivals. As a result, throughout the serial, England slides into civil war and a decline that culminates in the rise of the tyrant Richard III.” The fallout from one unplanned, unexpected succession.
Works Consulted:
Personating leadership: Shakespeare's Henry V and performative negotiation
What Shakespeare's 'Henry V' Tells Us about Leadership, Motivation, Wooing and Hanging
A history of succession to the throne
Time and the Problem of Royal Succession in Shakespeare's History Plays
We welcome your questions, feedback, and suggestions as series installments are released. Our emails are:
Subscribe to receive new installments in the series.
The information, opinions, and views presented in this publication are provided solely for general informational and educational purposes. They should not be interpreted or considered as legal, tax, financial, or other forms of professional advice. All information, opinions, and views expressed herein are of a general nature and have not been tailored to address the specific circumstances or needs of any individual or entity. As such, they do not constitute a comprehensive or complete statement of the matters discussed. Readers should consult with their own legal, tax, financial, or other professional advisors regarding the applicability of this information to their own circumstances.
This publication may include links to third-party websites and provide access to other third-party content, such as articles, news reports, company information, or other materials (collectively, “Third-Party Content”). These links and resources are provided solely for your convenience and general informational purposes. Permanent Equity Management, LLC (“Permanent Equity”) does not endorse, approve, certify, or guarantee the accuracy, completeness, or timeliness of any third-party websites or Third-Party Content, nor does Permanent Equity imply any affiliation, partnership, or endorsement between us and the owners/operators of any third-party websites or the providers/creators of any Third-Party Content. Permanent Equity has no control over third-party websites or their content and disclaims any responsibility for their accuracy, security, privacy policies, or the quality of any products or services offered through them. Accessing third-party websites or relying on Third-Party Content is done entirely at your own risk. Permanent Equity is not liable for any damages, losses, or liabilities arising from your use of, access to, or reliance on third-party websites or any Third-Party Content. Any transactions, decisions, or actions made based on third-party websites or Third-Party Content are solely between you and the respective third party.
The information provided in this publication does not constitute investment advice, nor does it represent an offer to sell or solicit the purchase of interests in Permanent Equity or any private fund it advises. It is not intended for marketing purposes to existing or prospective investors in any jurisdiction and may be subject to correction, modification, or supplementation without prior notice. Permanent Equity provides investment advisory services only to the privately offered funds it advises and does not solicit or make its services available to the public or other advisory clients.