Is It Becoming More Difficult To Hold On To One’s Seat?

The era of CEOs becoming synonymous with their posts is coming to an end. Managing the same company for 15-20 years is now just a dream. Economic slowdowns, competition, and the pressure of globalization are threatening CEOs and reducing the time they spend in their posts. The length of time executives spend in their posts in the 500 largest companies in the world has fallen to an average of six years. Amongst the 25 largest companies in Turkey, the average period that CEOs remain in their posts is 4.4 years.

Jack Welch, the legendary CEO of General Electric, remained in his post for fully 20 years from 1980 to 2000. Edward Whitacre ran AT & T for fully 17 years. Lou Gerstner, who became famous as the executive who revitalized IBM, served as CEO for nine years from 1993-2002.

In Turkey, Hayrettin Çaycı has served as general manager of Sarkuysan for 23 years. Turan Erdoğan has worked as general manager of Vestel Dış Ticaret for 20 years. Tuncay Özilhan was first appointed as board chairman of the Anadolu Group in 1984. Agah Uğur has been CEO of Borusan Holding for 13 years. But, despite these examples, the time that CEOs in Turkey remain in their posts is becoming shorter. It is not just in companies which post a poor performance. The times even the most popular CEOs spent in their posts is also shortening. Turkcell, which was chosen as the most popular company in Turkey in 2008, has changed CEOs three times in 15 years. When we look back over the last 10 years, there have been two CEOs at Akbank, four at Yapı Kredi Bankası, and three each at Garanti Bankası, Sabancı Holding, Tofaş and Koç Holding. Last year alone, 32 of the first 200 companies in the Capital 500, which is made up of the largest companies in Turkey, changed their CEOs.

The S & P 500 Average Is 6 Years
The length of time CEOs remain in their posts is becoming shorter all over the world. According to the survey conducted every year by the SpencerStuart company, the average time CEOs in the S & P 500 companies in America remain in their posts is six years. Whereas, according to data from research by the same company, in 1980 nearly two thirds of the CEOs in the 100 largest companies had served in the same company for as long as 25 years.

What Is The Life Expectancy In Turkey?
When we look at the length of time the CEOs and general managers in the 50 largest Turkish companies in the Capital 500 spend in their posts, we see that the average is 4.6 years. The average in the largest 25 is 4.4 years… 30 of the CEOs and general managers in the 50 largest companies have been in their posts for less than three years. Koç and Sabancı, the two largest groups in Turkey, have restructured their management in the 2000s. Both Koç and Sabancı have had three CEOs in the last eight years.

Ayşe Tarcan Aksakal
aaksakal@capital.com.tr