W.S. Darley & Co.

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1. Bill Darley found it hard to make a decision himself as to who would succeed him as CEO of the company. He did not want to show a preference for any of the three candidates, his two sons and his brother’s son. The candidates being family members, makes choosing a successor a very hard decision as it becomes an emotional issue and affects family relationships. I feel that this indecision also implies that these three candidates were relatively equal in their capabilities to be the CEO of the company. Advantages of having the third generation developing their succession plan: Since, it is the third generation that will ultimately be responsible for the continuation of the company, by involving them in the decision making; Bill is ensuring their continued investment in the company. When the third generation develops a succession plan themselves, they will be more cognizant of each other’s strengths and weaknesses. This will allow them to choose positions that will play to their strengths. As the three key players of the third generation make a succession plan together, the process will build a stronger relationship between them. When they are actually running the company, this bond will result in a stronger leadership and hence a stronger company. By giving this responsibility to the third generation, Bill has ensured that there is no resentment from the third generation towards the second generation or between the members of the third generation. This will result in a peaceful and successful transition of leadership and also a peaceful and happy family. Bill has paved the path to a company that will be strong knowing who its future leaders are. Disadvantages of having the third generation developing their succession plan: The third generation may be hampered by a lack of maturity. Their decisions are made using their current knowledge base. The third generation

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