November Continues Growth Trend in Executive Turnover
2011-12-12 11:42:28
Liberum's executive turnover data for the month of November has continued to show growing turnover within the executive ranks similar to what we have seen for most of previous months this year. This trend was a complete reversal of what we saw for the previous two years. November's increase in executive turnover took place while we saw a positive trend with regard to the number of people filing new unemployment claims and, even more significantly, the economy has actually generated more jobs. This is not say we are out of the woods with regard to overall employment and the economy but more positive employment signs continue to show up. In early December, the United States Department of Labor's Bureau of Labor Statistics (BLS) announced the latest employment numbers. The official unemployment rate dropped a modest 0.4% down to 8.6%, the lowest rate since March 2009. There still remains 13.3 million people unemployed a seriously high number. The modest gain in employment is further tempered by the fact that according to BLS 315,000 people had given up looking for work. Even las t week we saw another drop in the number of people applying for unemployment. Below Liberum has outlined in graphical format a November breakdown for CEO, CFO and overall C-level related turnover. C-LEVEL RELATED CHANGES FOR NOVEMBER
CEO RELATED CHANGES FOR NOVEMBER
CFO RELATED CHANGES FOR NOVEMBER
For the month of November, CEO changes increased a huge 125%, CFO changes increased 111%, overall C-level (as defined by Liberum Research as board of directors, CEOs, CFOs down to corporate VPs) changes increased 94% while board of director changes declined 11% as compared with November 2010 totals. The month to month change in executive turnover on the other hand was negative for November 2011 when compared with October 2011 totals. CEO changes declined 12%, CFO changes declined 15%, overall C-level changes declined a mere 2% and board of director changes declined only 3%. Liberum expects the fourth quater of 2011 to show an increase over the same quater in 2010. Stay tuned.
Third Quarter Executive Changes Continue to Grow
2011-10-10 12:18:41
The third quarter has been a rough time for workers, retirees, federal and state governments and companies. The economy has been crawling forward with blips of positive and negative news changing on a weekly basis sometimes even daily. The debt crisis here and abroad weighs on the U.S. and other world economies. Attempts to get the debt under control have in many situations actually exacerbated the job situation here in the United States and in Europe. One surprising statistic remains the increasing level of executive turnover at public companies in North America over the last few quarters. Typically in recessionary times, executive turnover tends to decline as companies hunker down and tend to keep most top executives in place while laying off lower level employees. This trend was quite apparent for most of 2009 through all of 2010. While overall unemployment has not been really increasing of late, the economy has not been producing many new jobs. At the end of last week a bit of slightly positive news came out on the growth of job production. The question remains whether it can continue to grow. Executive turnover, however, has been trending upward for the last few quarters. The current third quarter has seen that trend continue, which remains one of the few positive signs for the economy. Executive turnover may actually serve as a leading indicator for the future.
Liberum Research theorizes that the declining level of executive turnover over the previous number of years (2009 and 2010) related to the reluctance corporate boards and top executives had to change top leadership during tough economic times except in situations where the firm in question performed so poorly that a top executive change was necessary or if a major strategic change was needed. The overall U.S. economy continues to creep along despite heavy debt burdens, reduced consumer spending and a lack of growing capital investment on the part of companies.
Below are three simple graphs outlining the quarterly change totals as registered through Liberum's Management Change Database for 2005 through 2011 (third quarter) for CEO, CFO and overall C-level turnover. The first three quarters of 2011 dramatically illustrate the reversal in trends we have seen for a number of years. Executive turnover is again in the ascendancy. We expect this trend to continue unless the economy encounters some kind of major shock, lack of agreement on the debt ceiling going forward, or a major sovereign bankruptcy (Greece) or something totally unforeseen.
AMD Finally Fills CEO Post
2011-08-25 16:04:23
After over six months of searching for a new CEO to replace former CEO Dirk Meyer, who resigned back in January and had been
rumored to be forced out due to his lack of vision, AMD NASDAQ has finally chosen a new CEO. AMD has selected Rory Read, Lenovo's President and Chief Operating Officer to lead the firm as its new CEO. AMD's search for a new CEO has been painfully difficult. The semiconductor firm, which has managed somewhat of a resurgence while under the direction of former CEO, Dirk Meyer, and its current interim CEO, Thomas Seifert still has a difficult road to true recovery and long term survival. While AMD has been reasonably successful in the PC world as second banana to Intel, the company has very far to go with regard to processors for mobile phones and tablets the current growth generators. AMD has been through rough waters for sometime and many potential candidates have chosen not to be considered for the CEO position. Throughout the CEO search process a number of potential candidate names have been rumored under consideration including Tim Cook, Apple's soon to be new CEO after Steve Jobs made his dramatic resignation, Mark Hurd, Oracle's co-president and former HP CEO, Pat Gelsinger the Carlyle Group Chief Operating Officer and others have all supposedly turned down AMD.
Read's selection to run AMD is a positive, the company has finally found someone to take on the challenge. While Read has an impressive background while at Lenovo as well as significant leadership work while working at IBM for twenty three years he has a monumental task ahead of him. AMD's press release announcement contained a terrific spin on Read's selection. we will just have to wait and see. At least company now has a new leader and get to work on addressing many of the firm's future needs and strategic direction.
Investors need to closely monitor what Mr. Read does upon taking the reigns and going forward.
Second Quarter Executive Turnover Shows Real Growth
2011-07-19 12:15:29
With the end of the second quarter, the United States economy appears to have turned a major corner in relation to executive turnover. Executive turnover, as tracked by Liberum, has seen a continuing jump in the totals for June 2011 and the second quarter. The jump in turnover has been apparent when second quarter was compared with the same quarter in 2010 as well as in relation to the previous first quarter of 2011. The continuing jump in executive turnover appears to be at odds again with the level of employment and unemployment in the United States economy. Troubling signs for overall employment continue to haunt the U.S. economy as the recovery continues to limp along.
Now that we are finally seeing changes at the top of corporations, hope can increase that companies will finally begin to start hiring again. Liberum contends that the slow level of executive turnover over the previous number of years related to the reluctance corporate boards and top executives had to change top leadership during tough economic times except in situations where the firm in question performed so poorly that a top executive change was necessary or if a major strategic change change in strategy was needed. As we moved into 2011, we finally saw the level of unemployment bottom out.
Liberum expects that if the economy manages to recover, even ever so slightly, the level of executive turnover will continue to rise. Both the pent up demand for new top executives and the possibilities for new job opportunities will account for growing executive turnover. Also boards are expected to be more willing to make changes as the economy continues to move in a positive direction especially if the debt ceiling problem is resolved, even temporarily.
Below are three simple graphics outlining the quarterly management changes as registered through Liberum's Management Change Database for 2008 through 2011 (second quarter) for CEO, CFO and overall C-level turnover. The first two quarters of 2011 dramatically illustrate the reversal in trends we have seen for a number of years. Executive turnover is again in the ascendancy. We expect this trend to continue unless the economy encounters some kind of major shock, lack of agreement on the debt ceiling, for example, a major sovereign bankruptcy (Greece) or something totally unforeseen.
Newell Rubbermaid Picks Wisely
2011-06-24 13:16:11
Newell Rubbermaid NWL (NYSE), the consumer products manufacturer, yesterday announced the selection of Michael Polk as its new CEO. Polk, currently the president of global foods, home and personal care at Unilever is also a member of Newell's board of
directors. Polk will succeed Mark Ketchum who was selected as Newell's CEO back in 2005. Ketchum back in January of this year announced his intention to retire. The firm hired a search firm to find a new CEO. Wisely, the firm selected a seasoned executive familiar with their business but with experience outside the firm. Polk, who is fifty years old comes in as CEO as Newell has failed to live up to expectations. While he has a difficult task ahead of him, he has both the skills and the drive to help find ways to make the firm perform better going forward.
Earlier today, thestreet.com's Miriam Remer
wrote a piece expressing concern about expectations the new CEO will create about the firm. Remer wrote,
Jefferies analyst Douglas Lane cautioned that Polk will have his work cut out for him in managing expectations after Newell Rubbermaid recently trimmed its full-year outlook. The guidance revision came, in part, because of soft demand in some of Newell Rubbermaid's consumer product categories such as baby and parenting.I am not nearly as sanguine as the Jefferies' analyst quoted. Polk has a real opportunity to shine in his new position. Stay tuned.