Editor’s note: This story appears in the latest magazine issue of Talk Business Arkansas, which you can read online at this link.
Political realities that inhibit succession planning could result in uncertain leadership transitions at a state agency that has seen certain and stable leadership since its formation in 1971.
Richard Davies, the executive director of the Arkansas Department of Parks and Tourism, is set to retire at the end of 2015. Technically, the Parks and Tourism Commission approves the hiring of a director, but the director is appointed by an Arkansas governor.
Davies was appointed department director in May 1990 by then Gov. Bill Clinton. Prior to that, Davies had worked 14 years as director of the Parks division within the department, and served 18 months as interim department director. As a testament to his popularity within Arkansas’ tourism industry, Davies was reappointed by Gov. Jim Guy Tucker (D), Gov. Mike Huckabee (R), and Gov. Mike Beebe (D).
Also, Davies, who has been in the top job for more than 23 years, is just one of three department directors in the agency’s more than 42-year history. Bill Henderson was appointed by Gov. Dale Bumpers (D). Jo Luck followed Henderson, and Davies replaced Luck.
And it’s no small job. The agency employs more than 1,500, and has an annual budget of more than $125 million. The economic impact of tourism and business travel in Arkansas was estimated to total $5.687 billion in 2012, with more than 22.859 million business and tourists traveling to the state in 2012.
So who replaces Davies?
“The problem is that it’s hard for me to groom somebody because I have no idea who will be around to pick it,” Davies said during a recent interview about the possible leadership transition at the agency.
What’s more, Greg Butts, director of State Parks is set to retire in January 2016. Joe David Rice, director of the Tourism division, could retire a year or two after that. Davies, Butts and Rice are the top three execs at the agency. And while most private sector companies with a more than $125 million budget would have a leadership succession plan in place, Davies said that is not always possible with politically appointed jobs.
“The truth of the matter is, that Greg’s job in Parks and my job and Joe David’s job … are generally looked on as a governor’s approval type of job,” Davies said. “We worry about it, but there is only so much that can be done in advance, especially for the top jobs. … We can make plans below the top level, and we’ve been doing that.”
Davies said they are able to manage succession for most of the “senior management” jobs below the appointment jobs.
“A whole lot of our senior management started here in the 60s and 70s, and so they are retiring, they are dropping out like flies. … We have many of our respected senior people leaving, we’re losing four this summer. So what you have is that everything starts shuffling with people moving from the smaller parks to the larger parks,” Davies said.
An ideal situation, Davies said, would be for his replacement to be on the job for at least six months prior to his December 2015 retirement. But that will be a decision for the next governor. The gubernatorial frontrunners as of June 2013 are Republican Asa Hutchinson and Democrat Mike Ross.
When or if the next governor asks Davies’ opinion on who should succeed him, Davies said he would encourage the governor to hire someone who “knew something about parks and tourism.”
He said a governor might hire “someone who had been an operator of resorts” and knows the “fundamentals of parking lots and air conditioners.” He said the director has to manage a range of employees from “cops to artists to engineers” who have different roles and motivations.
“You have to manage all that, but more than anything, you need a good manager and a good coordinator. A lot of what I do around here is, ‘Who else needs to know about that?’ or ‘Who else needs to know about this before we make that decision?’” Davies said. “And it’s important to know what might happen two or three turns down the road after a decision.”
Davies’ concern about the political nature of the succession is the element of uncertainty.
“The biggest morale breaker is uncertainty. The longer that drags out, it’s bound to affect people’s morale,” Davies said.
Paul Harvel, the CEO of the Fort Smith Regional Chamber of Commerce, agrees that uncertainty can be a morale problem. Harvel, a 45-year veteran of chamber work that has included a lengthy stint at the Greater Little Rock Chamber of Commerce, is part of a succession plan at the Fort Smith chamber. It was recently announced that Tim Allen, who joined the Fort Smith chamber in November 2011, will become president and CEO of the chamber at the end of 2013. Harvel has been at the Fort Smith chamber since May 2009.
“I think transitions are good, because it gives you time to see if the person you have in mind for the job will be good for the job,” Harvel explained of the chamber’s succession plan. “In our field (private sector), you don’t necessarily have to go through a headhunter phase or the selection phase. You don’t have to spend any money on a headhunter firm. Also, the way we did it was not very time consuming.”
As important is the staff involvement, Harvel said.
“From the staff standpoint, then they know who the boss will be and they can make decisions about what they want to do,” he said.
If the next director is not hired from within, a transition would provide the person a chance to learn about the state and the agency, Davies said. A six-month overlap would allow the new appointee to learn about department functions and to see “people around the state you really need to get to know.”
“It’s sort of unfair to a new person to not give them the opportunity to have been part of something like that (succession transition),” Davies said.
Davies and Harvel agreed that there is one element of stability in the process: the Parks and Tourism Commission.
“One thing that will help with the transition will be the State Parks, Recreation and Travel Commission. There is a lot of experience there, and they understand why we do things from policy, research and pricing perspectives,” Davies said.
Harvel, whose wife Barbara is a member of the commission, said the diverse group will be hard for the next governor to ignore.
“You know, with Parks and Tourism they’ve always had a very strong commission from the standpoint that they have a lot of involvement from those members. They are committed to Arkansas and really work to see that (tourism and parks industry) grow,” Harvel said. “I believe there is enough credibility with the commission that a governor will listen to their recommendations.”
The other factor is that a director must adapt to a governor’s leadership style. Davies said the four governors he has served under had completely different styles.