White Paper
Turnover to Tenure
How Succession Planning can Stabilize Leadership and Position Organizations for Long-Term Growth
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Key Findings
- Senior leader tenure is declining across industries. Average executive tenure across C-suite positions is now 4.6 years — down from 7.9 years in the mid-1990s.
- Short tenures create real organizational damage: disrupted strategy, loss of institutional knowledge, change fatigue, and erosion of competitive advantage.
- 86% of leaders believe succession planning is urgent or important — yet only 14% believe their organizations do it well.
- Internal promotions reduce the risk of forced CEO turnover by 15% and extend average CEO tenure by 1.4 years compared to external hires.
- Organizations with formal succession planning and talent processes see stronger financial performance, greater leadership stability, and higher employee retention.
- Succession planning works best when treated as an ongoing organizational discipline, not a one-time event or crisis response.
The Leadership Tenure Crisis
After an exhaustive search, your board has finally found a CEO from outside the organization who seems to be the perfect fit — energetic, experienced, full of creative solutions to some of your most vexing challenges. Shortly after they begin, they announce a bold five-year strategy. Unfortunately, by year two, a new search committee is already looking for their replacement.
For over a decade, your firm has hired a string of VPs from outside the organization, each one with a grand plan for transformation. One wants to create a bold new vision. The next wants to quickly turn everything into a product. The third thinks the organization should look and feel “more corporate.” They all shake things up in turn — and they all leave before the transformation is complete.
With a strong bench of leaders coming up through the ranks, filling open leadership roles should be simple. But radical changes in the business environment lead senior leaders to hire new executives from outside. These leaders mean well, but their ideas clash with the organization’s long-held beliefs and values. Company-wide fissures cause long-term employees to leave. As the leadership bench begins to break down, the board expresses dismay, internal culture frays, and financial metrics slip.
Sound familiar?
Executive leadership tenures have been in decline since the mid-1990s. The story of the ambitious outside CEO brought in to “fix” an organization, only to be ousted or leave after a short, unsuccessful tenure, is one of the most common narratives in business today. Within organizations, mid-level leaders struggle to implement the initiatives of the latest CEO, only to abandon their efforts when that leader leaves.
External realities multiply these challenges. Pressures on the business environment create a climate of uncertainty that makes talent development and succession planning genuinely difficult. How can organizations prepare leaders for the next decade when they don’t even know what tomorrow holds?
The answer is not prediction. It’s preparation.
Revolving Doors in the C-Suite
The data around executive leadership reveal challenges across industries, geographies, and levels:
7.9 → 4.6
years
average executive tenure, mid-1990s to today4.8
years
average CEO tenure in S&P 500 companies (2022)+16%
increase
in global CEO turnover in 2025 vs. 202455%
of
CEO turnovers are performance-inducedSeveral forces are driving the decline in executive tenure.
Performance pressure is the primary cause. Up to 55% of CEO turnovers are performance-induced, meaning that even many “voluntary” resignations are ultimately performance-driven. Activist investor pressure has compounded this: out of 327 CEOs who resigned from public companies in 2024, a record 27 of them resigned under activist pressure, nearly three times the number in 2020. Investors show an increasing unwillingness to wait for results.
The digital age creates new forms of accountability. A paper trail follows every decision, and social media amplifies scrutiny. One lapse in judgment or ethics — even one that is only perceived, not actual — can trigger sudden leadership changes.
Other factors include misalignment between boards and senior leaders, generational shifts as Baby Boomers leave the workforce in large numbers and a smaller Generation X fills the majority of global leadership positions, and a general shrinking of tenures across all positions. Median employment tenure across all positions fell from 4.6 years to 3.9 years from 2014 to 2024.
None of these forces are going away. Organizations that wait for conditions to stabilize before investing in succession planning will keep waiting.
What Happens When Senior Leaders Leave Too Soon?
Shorter executive tenures produce real, lasting damage to the organizations they leave. The costs go well beyond the expense of a new search.
Disrupted Strategy and Momentum
Whether transformation initiatives are working or failing, they still cause upheaval, and organizations must pick up the pieces when a leader leaves. Rebuilding, starting over, or shifting direction can set an organization back years.
Change Fatigue
Workers have experienced a volume and pace of change that few generations have seen. Compounding external disruption with leadership upheaval accelerates employee turnover and reduces engagement, as people seek more stable environments.
Loss of Institutional Knowledge
When key leaders leave without internal successors, decades of knowledge leave with them. Senior leaders carry the unwritten rules of the organization — insights, philosophies, and values that can only be passed on through intentional mentoring and deliberate preparation of successors.
Erosion of Competitive Advantage
Every organizational upheaval means time spent restoring reputation, employee morale, and financial position. While an organization rebuilds from the inside, competitors establish stronger market positions on the outside.
Is Succession Planning the Answer?
Yes.
Research consistently shows that organizations that intentionally identify and develop future leaders see longer executive tenure, stronger business performance, greater leadership stability, and higher employee retention.
The Four Advantages
Longer Executive Tenure
An analysis of nearly 5,000 US CEO tenures from 1992 to 2018 showed that internal promotions reduced the risk of forced turnover by about 15%. Internally hired CEOs average 8.7 years in the role, compared to 7.3 years for external hires.
Better Leadership Stability
Intentional talent identification and development preserves institutional knowledge, ensures continuity in critical roles, minimizes disruptions, and sustains strategic direction across leadership transitions.
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Stronger Business Outcomes
A 2023 study found that succession planning contributes to organizational sustainability by fostering transformational leadership, learning agility, and resilience. Organizations with formal succession processes that include talent identification and development show better overall firm performance, including financial results.
Improved Employee Retention
Succession planning ripples through an organization. When employees see clear pathways for career growth, they stay longer. Strong internal mobility programs correlate with 53% longer employee tenure on average.
s
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Where Succession Planning Falls Short
Despite the evidence, most organizations still struggle. Research adapted from Harvard Business Review (July 2025) identifies five common failure modes:
- Too much talk. Leaders spend time analyzing promising employees but not enough time actually preparing them.
- Political influence. Internal politics — hoarding talent, feeling threatened by potential successors — distorts the process.
- Tackling too many roles. Trying to build a succession plan for every position rather than focusing on the critical few.
- Transactional mindset. Treating succession planning as an annual check-the-box exercise rather than an ongoing discipline.
- Not embracing new realities. Using strategies that worked in the past but don’t fit today’s business environment.
Why Most Organizations Still Don’t Do It Well
Succession planning’s advantages are well-documented. So why do only 14% of leaders believe their organizations execute it well? Organizations face real barriers — and understanding them is the first step to overcoming them.
Short-Term Thinking
In many organizations, succession discussions happen only when a transition is imminent or a departure is sudden.
As one executive put it:
“Succession planning is one of those things that has no lit fuse.”
Without urgency, it gets deferred — until it can’t be.
“Ungovernable Change”
The first quarter of the 21st century introduced what Gartner has dubbed “ungovernable change” — a combination of complex, stacked, and continuous disruptions that make even quarterly planning feel impossible. Long-term succession planning can feel like an unaffordable luxury when the immediate demands never stop.
Generational Shifts
Organizations face shifting attitudes toward work and leadership alongside the sheer numbers of Baby Boomers exiting the workforce. Some younger Millennials and many Gen Z employees express less interest in traditional management roles, creating real pipeline challenges for organizations that haven’t built development cultures.
Interpersonal Dynamics
Some leaders perceive intentional succession planning as a threat to their own positions. When naming a successor feels like accelerating one’s own departure, the natural response is avoidance. This dynamic is especially common when the CEO is the source of resistance.
Lack of Clarity
Who is responsible? HR? The board? Individual leaders? Without clear ownership, a defined process, and the right data systems, succession planning stalls before it starts. Starting can feel like pulling one loose thread and unraveling an entire organization.
The Stewart Leadership 3D Model for Future-Ready Talent
Over decades of working with organizations at every stage of change and growth, the experts at Stewart Leadership have seen every barrier to succession planning come into play. The conversations touch on financial, cultural, and psychological dimensions simultaneously — and that complexity is often what stops organizations from starting.
The 3D Model gives organizations a practical, disciplined starting point. It is not a rigid program. It is a framework adapted to each organization’s context, scale, and readiness that can be applied with organizations ranging from small leadership teams navigating their first structured process to large enterprises rebuilding from the ground up.
1. Determine
Resist the temptation to dive immediately into names and candidates. Start by defining the organization’s talent strategy and securing buy-in. Identify two to five critical positions — those that would cause real strategic damage if left unfilled, and that require six months or more to fully integrate. Build talent profiles that capture performance data, aspirations, and leadership potential.
Consider: an up-or-out talent philosophy requires a very different approach than a long-tenure, career-building culture. Getting clear on this distinction shapes everything that follows.
2. Discuss
Bring the right people into structured talent review conversations. These discussions — facilitated well — surface perspectives that no single leader holds alone. Tools like nine-box grids provide a framework, but the real value comes from the quality of the conversation: candid, focused on the organization’s future needs, and grounded in objective data rather than internal politics.
Candidate aspirations must be part of this conversation. Organizations can invest significantly in preparing someone for a role they have no interest in filling.
3. Develop
Turn the conversation into action. Everyone in the leadership pipeline should have access to the talent review. Individual action plans, stretch assignments, coaching, and ongoing feedback from managers create the conditions for actual readiness — not just readiness on paper.
Development without consistent follow-through is an annual exercise. Organizations that build the habits and structures to review, adjust, and reinforce development plans are the ones that build leadership that lasts.
Best Practices for Successful Succession Planning
No succession planning model guarantees results in every context. But across decades of work with organizations at every stage of change and growth, Stewart Leadership has identified practices that consistently improve senior leader retention, strengthen the leadership bench, and deliver stronger business outcomes.
1. Shift Accountability from HR to the Business
Establish clear accountability, well-defined roles, and specific succession objectives. Succession planning cannot be owned exclusively by HR. Leaders must fully participate — including identifying potential successors and actively supporting their development.
2. Practice More Development, Less Calibration
Top executives should be actively involved in developing future leaders — assigning stretch assignments, targeting future executives for coaching, creating real growth opportunities rather than spending most of the time on reviews and calibration meetings.
3. Build a Talent-Multiplying Mindset
Encourage everyone to source candidates for current and future roles across the organization. Talent hoarding — protecting high performers from advancement to preserve team continuity — is one of the most common and damaging patterns in succession planning.
4. Create a Strong Talent Identification Process
Every organization must develop a talent identification process tailored to its culture, strategy, and goals. Effective processes combine competency frameworks with psychometric tools, 360° assessments, and structured tools like the nine-box talent grid. The goal is objectivity — reducing the influence of familiarity and politics on succession decisions.
5. Encourage a Development Culture
Provide clear opportunities to grow and develop at every level and function, backed by transparent performance and development feedback. Leaders can come from anywhere. Organizations with strong development cultures retain more people — and build a larger, more diverse internal pool of future leaders.
6. Clearly Link Succession to Strategy
The organization’s overall strategy should define the skills successors will need to deliver future results — not the skills that worked in the past. In an era of rapid change and AI disruption, some of the most important capabilities (tolerance for ambiguity, ability to reconcile shifting dynamics) are not easily measured. Identify them deliberately and emphasize them in talent planning.
7. Leverage Technology and Data
Create, store, and update talent profiles in a shared system. Set up notifications when action plans are incomplete or due for review. The discipline of maintaining current talent data is what separates succession planning as an ongoing process from succession planning as an annual document.
What High-Potential Future Leaders Look Like
Identifying the right candidates for development is as important as the development itself. The best high-potential future leaders share five characteristics, and understanding them helps organizations look beyond current performance to future readiness.
High Learning Agility
Employees with high learning agility learn quickly from past experiences, prefer variety in their work, keep their skills current, and consistently deliver strong results on new initiatives. They adapt well to change — a critical quality in an era of ongoing disruption.
Self-Awareness
Thought Leadership
Desire to Grow
Talent Development Orientation
Building Leadership That Lasts
Between the pressures of modern leadership and the shrinking tenure of positions across every level, it’s easy to understand why leaders and HR professionals feel overwhelmed by succession planning. Trying to predict what kind of leadership will be necessary for the next year, five years, or decade feels impossible when the ground keeps shifting. It is tempting to focus only on immediate needs, or to hope that talented people will emerge when needed.
But that is a recipe for the very instability that undermines organizational success.
Organizations don’t need to predict the future perfectly. They need to build the capabilities that will help them adapt to whatever comes next. Research consistently demonstrates that formal succession planning delivers. The same data that reveals declining tenures also points to the solution: internally promoted leaders stay longer, perform better, and face lower risk of forced departure.
Succession planning does more than fill seats. Done well, it creates a virtuous cycle that improves organizational resilience, strengthens the internal talent pipeline, and builds the conditions for leaders — and organizations — that last.
Frequently Asked Questions
Why is executive tenure declining?
What are the consequences of short executive tenure?
What does research say about the benefits of succession planning?
What are the biggest barriers to effective succession planning?
What is the Stewart Leadership 3D Model for succession planning?
What qualities should organizations look for in high-potential leaders?
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