If leader leaves the alliance, longevity in the alliance determines who gets promoted to new leader. If that person is active, you are good. You can kind of tell who that might be by the order people are listed in chat.
If you want to decide who the leader is and it isn't the person next in line, your present leader needs to boot everyone until the preferred person is the next up. Then he quits, and everyone rejoins. If you don't know how long people have been in the alliance, this is tricky. We booted everyone, giving a week's notice, on a weekend when most people would be online. Only the new leader was not booted, then old leader quit. First person to rejoin was the person we wanted to be first lieutenant, second person was second lieutenant, as it were. Then everyone else came back in.
We did lose some players who never came back in, though.