The Leadership Skills of Late Night

How Letterman, Leno, and Stewart’s leadership skills saved late night TV

By — on / Leadership Skills

The Leadership Skills of Late Night

Selecting the right person for a challenging job is often more than just a hiring decision. It’s a negotiation. Doing it well requires exceptional leadership skills. Nowhere is this clearer than in late night television. First Jay Leno left The Tonight Show. In mid-May 2015 David Letterman followed suit and then Jon Stewart did the same. For each host, the choice of a successor had been a high-stakes process worth millions of laughs for viewers, and millions of dollars for television executives.

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Jimmy Fallon took Leno’s spot and Stephen Colbert took Letterman’s chair. Trevor Noah then succeeded Stewart. As the new hosts took center stage, however, it is worth contrasting the calm transitions with the botched negotiations that bedeviled late night TV over the last 20 years.

How Not to Handle a Negotiation

At one time Johnny Carson was the only game in late night television. When Carson stepped down from The Tonight Show in 1992, a highly public battle for his job erupted between Leno and Letterman. Letterman ultimately lost and headed for rival network CBS. Leno won the slot, but it cost him millions of viewers. The Late Show with David Letterman topped the ratings for years before Leno could recapture his show’s audience.

Leno’s retirement in 2009 went just as badly. A highly publicized battle with his presumptive successor, Conan O’Brien, led to Leno’s brief return and O’Brien’s departure from NBC. It wasn’t until Jimmy Fallon stepped in to take Leno’s place that late night quieted down. In the interim, The Tonight Show’s ratings suffered once again.

The Right Leadership Skills Limit the Costs

The reason for this year’s easygoing handoffs is not a fluke. Ratings determine what advertisers will pay a network for placement on their program. By fighting between one another, late night hosts turned many viewers off, and viewers turned them off in return, costing networks millions of dollars in revenue.

Instead, the last year has shown that the outgoing hosts and network executives have a nuanced understanding of the leadership skills needed to ensure a smooth transition. Their careful decisions, and the hard-fought lessons behind them, have value for anyone looking at how to manage a highly public transition.

Every Negotiation Has Value, Even When You Lose

When Carson announced his departure, few people thought that the consequence would be David Letterman ending up at rival network CBS. CBS had a poor record of competing for late night ratings and had resorted to showing reruns. Letterman’s departure is what negotiation experts call the best alternative to a negotiated agreement (BATNA) and it shows how there is often more value in a negotiation than might first appear.

Rather than stay at NBC, Letterman did something decisive and unexpected. He jumped ship and convinced CBS to take a chance on The Late Show. The leadership qualities that led him to walk away served him well. Letterman taped 6,000 episodes in two decades at CBS, bringing in $114 million in revenue for the network in 2014 alone.

“Big” Isn’t Always A Good Leadership Quality

Just as negotiation experts advise that we look at the interests behind positions, it is important that leaders recognize the leadership skills for a given situation, not just the titles of the people in charge. Late night television hosts are big personalities, as are their agents and their network executives. Each one has a place in finding the right successor, but the most recognizable leader in a group can’t necessarily do it alone, as Leno discovered when he was dissatisfied with O’Brien taking his place. Backtracking that decision lost value for everyone and left interpersonal damage that will last for years to come.

Good Leaders Share Well

Things haven’t gone well for late night when the network executives and hosts haven’t supported one another. Carson and Leno’s indecisiveness about their successors was extraordinarily damaging. Instead, network executives and hosts appear to understand that each possesses a unique set of leadership skills necessary for picking the best new host. Letterman, Leno, and Stewart know what it takes to be the public face of a show, but network executives know whether that meets the bottom line. Sharing the decision-making process limits the possibility that a feud will erupt over who comes next.

Recognize Competitors Who Aren’t At the Table

An unsophisticated negotiator would say that selecting an outstanding successor to an outgoing late night host is all that matters. A more nuanced negotiator would say that the selection should take into account the rival late night programs on TV. In actuality, the choice of successors has to take into account an array of competitors that includes people and platforms. Even when The Tonight Show was the only game in town, there were more parties at the table than anyone bargained for, and the results were dire. The same is true, perhaps even 20 years later.

Good News is Better Than Bad

When Stewart’s replacement, Trevor Noah, took criticism for past standup routines, Stewart recognized that an old adage isn’t actually true. All news isn’t actually good news. Eager to convince advertisers that their shows will continue to have value with new leadership, networks can’t afford to have bad news about the incoming hosts.

Having been relatively silent about his successor, Stewart recognized a moment where he could nip the spiraling crisis in the bud. A few even-handed words of praise stunted what could have been a damaging start for the new host and a costly one for the network.

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Claim your FREE copy: Real Leaders Negotiate

If you aspire to be a great leader, not just a boss, start here: Download our FREE Special Report, Real Leaders Negotiate: Understanding the Difference between Leadership and Management, from Harvard Law School.

Originally published in 2015.

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