All hell is breaking loose in company heaven: Numerous companies experience abrupt management changes. Some have to, others can’t after more than two years in crisis mode. The problem: There are not enough good successors ready. A great danger for Germany.
The Swiss luxury watch manufacturer Audemars Piguet knows that money obliges. And so the grande dame of chronometers, Jasmine Audemars, announced her retirement from the board of directors of the family company calmly and in well-chosen words. There will also be a CEO change – definitely at the end of 2023.
This is what serious planning looks like in a traditional company. The departing great-granddaughter of the founder is at least 80 years old. You also have to be able to let go, she is said to have said. Erwin Müller has a decidedly different opinion. The drugstore boss fires more than he hires. Just recently the youthful-looking CEO Günther Helm (43). Müller himself is 90 and is now taking over the helm himself again.
There can be no question of age at Adidas if you look at the abrupt cut that Kasper Rorsted (60) has overtaken. The initially celebrated sportsman pissed off investors and was responsible for some of the damage to the reputation that Adidas had suffered in the past. Rorsted’s product pipeline, which critics say is currently not very imaginative, was associated in the most unfortunate manner with loyalty to Qatar, the host country of the upcoming World Cup.
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In times of flash mobs and real-time campaigns via social media, some disgrace increases and what has been achieved no longer counts for much. Exaggerated savings plans such as the cessation of rent payments for branches in the lockdown, although quickly corrected, remained a source of excitement. The most ephemeral job title in these circles is probably “bearer of hope”.
Much of what one now seems to blame Rorsted for, however, once distinguished him: the market value climbed until it stopped climbing; its efficiency and fixation with numbers were praised, as was its focus on the digital. His contract was extended until 2026 two years ago – but now it has suddenly been shortened. Successor? Sought, demanded, but not yet delivered. Not a good sign with such a personality.
It was similar at VW: Herbert Diess, the former BMW car man, worked on the corporate change and used or wasted a lot of energy on the most stubborn horse in the stable, namely the VW digital subsidiary Cariad. At Volkswagen, a lot depended and still depends on their operating systems and software, and if it doesn’t work, cars get stuck or aren’t built at all.
That seems to have seemed even more expensive to the supervisory board than continuing to pay the boss without a division until 2025. Although there is a direct successor in Porsche CEO Oliver Blume, he has a double burden: Porsche and the entire VW group? Investors are skeptical, as some large investment funds immediately put on record. Sounds like a contingency plan too.
The health group Fresenius, mother of the clinic operator Helios, which is also listed in the Dax, also made a clean sweep. Board member Michael Sen will soon succeed Stephan Sturm, who has to leave early. At Fresenius there are numerous problem areas for which the supervisory board has long wanted at least a semi-new hand. The former Siemens manager Sen should get the dialysis yields of the subsidiary FMC out of the valley again, lead Helios to new shores, beyond the nursing shortage; and make a breakthrough in fresh product lines.
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All of these examples show a clear trend and an enormous problem for Germany as a business location: there is not only a lack of skilled workers, but also of sufficiently qualified managers. And not only in DAX corporations, but also across the board in medium-sized companies.
Inspiring managers and especially women managers are hard to find. And the few that seem to exist can choose their jobs: “The fight for sufficiently qualified executives has become much tougher. The number of qualified executives is declining sharply. We now clearly have a candidate market,” says a headhunter specializing in executives.
According to the findings of labor market experts, this already applies to middle management and the specialist level, where around 120,000 euros are earned a year. In the case of the German medium-sized and family businesses, often praised as hidden champions, it becomes even more difficult – they often cannot keep up with the offers of large corporations for their executives. Hardly any down-to-earth company has tennis courts and an indoor swimming pool directly on site or various opera houses in the vicinity. The Association of German Chambers of Industry and Commerce predicts bleak things: “In addition to the shortage of skilled workers, our economy is also heading towards a shortage of entrepreneurs,” says DIHK President Peter Adrian.
What’s the problem? The well-known demographic problem is that, in purely quantitative terms, there are fewer young people than there are baby boomers retiring. Still, not much was done about it. Second, the current generation of well-educated people has different priorities than the older generation, which leads to misunderstandings and cultural problems: many young people give their all for the cause, want to drive projects forward and achieve everything for their company. They rely on speed and want to achieve a lot in as few hours as possible thanks to new technologies. Not everyone is interested in all the bureaucratic tasks, including empathetic appraisal interviews.
However, many older managers expect executives by definition to work 50 or 60 hours a week, almost out of habit. That doesn’t work, especially since work-life balance is playing an increasingly important role and parents of generations Y and Z – namely mothers and fathers – also want to see their children.
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A so-called expert career with a lot of home office and specific project responsibility seems more attractive to many. Especially since the salaries here are now comparable. And then, of course, the crucial question: Does a candidate fit the company and the task? After all, the demands have not exactly decreased, and even self-confident, ambitious managers from the second tier may sometimes be mistaken about their qualities for the really big task. Nothing good can be expected for the future of the highly developed German economy.
In the farewell statement, the head of Adidas, Rorsted, said of the crisis years: “It took a lot of strength to master these external challenges.” What he is openly addressing for his circumstances: The past two years have been extremely strenuous and exhausting for managers. Even top people burn out.
Given the circumstances, the current spate of top-level shifts seems no coincidence, and more surprises are sure to follow. The already bad image of company leaders – by far the most common group among the murderers in the “crime scene” – will continue to decline.
It’s a shame and dangerous for Germany, because the cliché of the “old white man” with a broken private life has nothing to do with a modern manager. Here you need good marketing for a job that doesn’t have to be that bad. Investors see the numerous problems that are caused simply by circumstances outside the company. And calculate soberly: A CEO should be able to get these risks and adverse circumstances under control – that’s what he’s paid for. Or replaced.
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