Success Is Not a Succession Plan: School Governance Lessons from the NVIDIA Debacle

"The worst time to start thinking about a catastrophic scenario is when you’re already living through it." Amy Webb

In less than three weeks, the company at the center of the AI revolution went from untouchable to unmoored.

After at least fifteen quarters in a row of beating Wall Street earnings estimates and standing at the pinnacle of the AI economy, it took just three days between NVIDIA CEO Jensen Huang admitting his affair, to the start of an investigation, to Huang’s resignation.

Unpack the consequences of the infidelities from Esther Perel. For this newsletter, I’m interested in the leadership and succession lessons. As James MacDonald and I discussed in our spontaneous recorded conversation, many things can remove a leader suddenly: illness, a family emergency, a scandal, a better offer. My question is about school governance: when the unthinkable happens, is the institution ready? What could have been prevented? What’s the lesson from Nvidia?

The cracks were there

The public may have been stunned, but inside NVIDIA and across the industry, the warning signs were there. Huang’s biographer, Stephen Witt, describes a leader who couldn’t tolerate disagreement, protected by “a culture of omertà that was difficult to break.” And in May, short seller Culper Research flagged Huang’s “uncomfortably close relationship,” but the report was easy to dismiss, likely because of all the money at stake.

Was the institution ready?

Yale’s Jeffrey Sonnenfeld said, “There is no board succession plan, which is extraordinary.” Huang reportedly had about 60 direct reports and no second-in-command. To be fair, Huang’s flat structure was also a strength. It let him see more, take bold risks and pivot fast, without the bureaucracy that slows most large companies down. But that is exactly why the board’s job mattered. The more an organization depends on one extraordinary person, the more it needs a plan for life without them. Asking “What if we need to change him?” got too tough.

Schools don’t make chips. They are trusted with something more precious: the intellectual, emotional, physical and often spiritual development of children. Across Boards we work with around the world, we see some clear parallels and lessons.

For example:

1. Strong performance in one area can hide fragility. A charismatic, long-serving head and some exceptional university results or a big incoming class make it easy to put off hard questions. Look deeper, to the culture, what might we be overlooking? Who is unheard?

2. Don’t wave away the warning signs. People within organizations might notice worrying signs about a colleague and choose to look away, especially when that person seems successful or well liked. I’ve seen this on the finance side at schools, or environments with a history of volatility. People want to believe the best about a colleague, so they avoid the hard conversation that might have saved everyone, including that colleague. Good governance doesn’t mean suspicion. It means having systems in place, like independent audits, clear reporting lines and safe ways to raise a concern, so the school doesn’t depend on goodwill alone. A culture where no one can tell the leader a hard truth is a risk in itself.

3. Treat succession as organizational readiness, not only as filling a vacancy. Naming a new leader is only one part of succession. Readiness decides whether the school can absorb a sudden transition and keep moving. That depends on whether leadership is spread across the team, whether there are strong relationships beneath the top, and whether the senior team is used to making decisions together and supporting each other's success. It’s worth asking how much of your school’s reputation rests on one personality.

4. Build strategic foresight in the Board. A board’s main job is oversight and strategy, not day-to-day operations. That includes thinking through plausible worst cases before they happen: the sudden loss of a head, a safeguarding crisis, a cyberattack, a fire or flood, a geopolitical shock to international enrollment. Then follow the second- and third-order effects on families, faculty, accreditation and trust. Boards rarely share contingency plans publicly, but they have a fiduciary responsibility to plan for risk, and a regular foresight process strengthens risk mitigation.

5. Pay attention to the leader’s inner work. School leadership only seems to be getting more complex and stressful. Ensuring the leader’s success also means paying attention to the heart of leadership: self-awareness, ethical judgment, how a person handles stress, power and influence, and a place to express their most difficult challenges. This is one reason why we consider coaching leaders to be a critical component when we partner on strategy. Boards’ care for leaders’ well-being and continued growth should be a normal part of how they support and evaluate a head. This care might take the form of spending time and resources on coaching, offering generous feedback, and practicing radical candor, particularly with the board chair.

6. Look beneath the headline numbers. The AI economy has been widely described as K-shaped. A soaring stock market doesn’t mean everyone is thriving. In the same way, high test scores and elite university admissions can mask that every child is not flourishing. Some students do well under that model, while others stagnate. A board that only watches the top-line results can miss both kinds of risk.
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Big Questions for the Board:

🟣 Have we seriously thought through the loss of our most important leader?

🟣 Have we looked at the consequences beyond succession itself?

🟣 When did we last update our scenarios?

🟣 Could we carry out our contingency plans tomorrow?

🟣 What concerns have we heard and set aside because the messenger was inconvenient or the person in question had more social capital?

🟣 Can people in our school tell the Head a hard truth, and would we know if they couldn’t?

🟣 Whose story of success are we hearing, and whose are we missing?

James mentioned John F. Kennedy’s advice to fix the roof while the sun is shining. I tell my kids to network when they don’t need a job. Boards should have the hard conversations when things are going well. Trust isn’t only personal. It’s organizational and strategic, and it calls for courage to have hard conversations.

Don't hesitate to reach out if you'd like to explore ways to build Board and leadership capacity.

Onward and with hope,

Homa
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Resources to Further Explore this Theme

​Profits, Prophets, Coaches, and Kings: (When) Do Leaders Matter? By Jared Diamond

What’s the actual value-add of an individual leader? How replaceable is any one individual? Legendary writer Diamond argues that true leadership effectiveness usually depends on a rare alignment of personal traits with underlying resources, timing, and environmental circumstances.
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Blue Skies Leadership Podcast: Navigating Systemic Leadership Transitions with Kevin Baker, Director, American International School of Guangzhou

Kevin has carried out significant and useful research on Head of School transitions, and the many gaps embedded into a process that too often invest heavily in recruitment, but underinvest in leadership transition. Transition is a piece of the succession puzzle and deserves further development for good governance and institutional health.

​How the Mighty Fall: And Why Some Companies Never Give In, by Jim Collins

Institutional decline is like a disease: harder to detect but easier to cure in the early stages; easier to detect but harder to cure in the later stages. An institution can look strong on the outside but already be sick on the inside, dangerously on the cusp of a precipitous fall. Collins outlines stages, starting with “hubris born of success," then "the undisciplined pursuit of more,” to "denial of risk and peril," "grasping for salvation," and "capitulation to irrelevance or death." Rather than see this as a negative conversation, consider the benefit of confronting difficult truths, even if things seem fine today.

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