You’ve defeated your rival in a CEO succession race. Now, how do you lead them?
This week, Disney announced Josh D’Amaro, its parks chief, who will take over for outgoing chief executive Bob Iger in March. Along with the honor of the CEO position and the huge task of running the complex entertainment giant, D’Amaro faces a difficult personnel challenge: becoming the boss of his former peer. Dana Walden, Disney’s TV and entertainment chief, was reportedly a fellow CEO contender he defeated for the job.
There are those who left their companies after being overlooked for the top job. And leaving can be a natural reaction to such a slight. Notably, when GE named Jeff Immelt CEO in 2001, the three other internal candidates eventually left the company for top positions elsewhere. Former retail chief Ron Johnson left to become CEO at [company name] when the tech giant named Tim Cook CEO in 2011. Just last month, [company name] announced that its international CEO Kathryn McLay, considered a CEO contender, [left the company] following the appointment of John Furner as the retail giant’s next chief.
But in Disney’s case, Walden seems likely to stay, at least for a while. In announcing D’Amaro as CEO, [Disney] promoted a respected Hollywood insider to president and chief creative officer. She’s the first to hold that title in the company’s 102-year history, and it gives her oversight of all of Disney’s movies and streaming series. Along with praising Walden’s creative and storytelling credentials, the Disney press release notes that she “will report directly to D’Amaro,” the person who beat her out for the CEO job.
And here’s the problem. Even for the most confident executives, that situation could be awkward. The CEO runner-up has to soothe a bruised ego while answering to the ultimate winner of the succession race. The incoming CEO, meanwhile, has to manage a team that includes someone who wanted their job.
At least on paper, Disney has structured D’Amaro and Walden to navigate the many pitfalls such a scenario presents by giving the new CEO and chief creative officer roles that are distinct and complementary.
“She’s on the creative side, while D’Amaro is more on the financial and parks side,” says Susan Sandlund, a managing director at Pearl Meyer who leads the firm’s leadership consulting practice. Walden “brings value in a completely different way than D’Amaro does,” she says. “Together, it’s a very powerful team.”
It could be said that Disney’s new dual leadership arrangement, which capitalizes on the executives’ strengths, is similar to [comparison] but better, Sandlund says. “You have one reporting to the other,” she says. “The moment you have equal CEOs, you’re inviting ambiguity and potential conflict.”
Still, distinct titles and designated areas of influence won’t ensure a smooth partnership. The burden is on D’Amaro to establish a common, shared goal that he can rally his new team around and to assign meaningful tasks to Walden, says Emma Zhao, an assistant professor of commerce at UVA’s McIntire School of Commerce. “That helps set aside some of those individual concerns and motivations.”
A variable in all of this, of course, is Walden’s personal feelings about the situation—her ambition and whether she’s determined to be a CEO one day. If that’s the case, her new position and a [factor] may only keep her at Disney for so long.
Sandlund, who has advised executives in Walden’s position before, suggests her best strategy is to be patient. “My advice is don’t make any hasty moves right now. A lot of people will be contacting you for other CEO roles, which you could accept immediately,” she says. “But if an executive really likes where they are, they love the culture, they’ve been there a long time, then they often want to see what the company can do to make it worth staying.”