Bernard Forgues, with colleagues, looked in detail at the full career history of every single CEO in the Fortune 100 list of top companies. Here we ask what he found:
What motivated you to look into the careers of CEO’s in the first place?
Top CEO’s are an interesting group – they demand attention, people want to know how they operate and what they did to gain success. They publish books, they’re in the public eye, there’s a fascination with their habits and rituals. They are also very important for other reasons; they shape society and they personify the organisations that people pay attention to. This has meant that they are also very well researched and are perhaps the most studied group of individuals in business organisations.
MBAs and other business students look up to them as models to be emulated – but as the labour market has changed over the last twenty years, what does this mean for those that aspire to the top job? Have CEO careers changed accordingly or do they operate in a unique way?
So how did you find out?
We decided that the only way was to scrutinise the career trajectories of top CEOs, so we took the Fortune 100 list of the top global companies and looked into every career move made by the CEO of every one of the companies in the list from the beginning of their careers to the present day – from the likes of Walmart’s Michael Duke at the top of the list through to Jeff Bezos at Amazon and James Dimon at JPMorgan Chase.
We looked at three main variables on a yearly basis – the status of the job they had, the function they fulfilled and the kind of job change they had had over the previous year, if any. We used sequence analysis to find patterns in the career paths before applying clustering techniques to identify distinct groups of career paths that led these individuals to the uppermost management level.
And what were the results?
They were very interesting. Essentially, we found that if you want to be a CEO, it is best to have a traditional, linear job progression. 37% of the list had been with the very same company since the beginning of their careers. And even though it took on average almost 28 years to reach the most senior position, CEOs averaged only 2.7 employers during that period. Changing industry was also relatively rare with 62 CEOs in the list only ever having worked in one sector – with an average of only 1.6 industries per CEO across the whole sample of 100 leaders.
Being promoted at regular intervals was also a key feature, with CEOs having changed jobs on average 9.3 times on their route to the top. The average job duration between promotions was three years.
And the message to those who want to climb the corporate ladder to the very top?
The message from this analysis is very clear. The typical career has changed a lot in the last twenty years. People have more jobs in a lifetime and are generally far more willing to move around different industries and job roles. But if you want to become a top CEO, it pays to be more conservative in your career choices.
CEOs tend to have traditional careers and they tend not to move around very much. There is a belief amongst some that trying different things and having diverse experiences will make them more employable and/or promotable. But, when it comes to the top positions, companies look for linear, logical career paths and steady progression.