CEOs & The Great Resignation
Two significant tech resignations have already happened this week in Jack Dorsey of Twitter and Kedar Deshpande of Zappos. Jeff Bezos resigned from Amazon earlier this year. And while we’ve written about the Great Resignation previously, we’ve never looked at it at the CEO level.
Fast Company posted a story in November titled “The Great Resignation rages on: CEOS are fed up with their jobs, too.” It referred to a Heidrick & Struggles report (yes, we’re not afraid to share great data from other search firms) that specifically showed CEO openings had significantly increased in the first half of 2021 compared to the first half of 2020.
In another article by ZDNet titled “Why is the tech industry losing record numbers of CEOs?“, they dig in deeper specific to the tech arena. They used a report from the career transition/outplacement firm Challenger, Gray & Christmas, which shows 144 tech CEOs had exited their companies this year alone.
But why is the tech arena seeing more resignations this year?…
- The pandemic has been brutal on everyone. CEOs have had to navigate taking entire companies remote, implementing hybrid schedules, and the potential beneficial and detremental long-term effects.
- It has been a crazy 12-18 months related to VC/PE funding, acquisitions, etc.
- There is a constant battle with various governments, regulations, and fines if you’re big tech.
- Sometimes a CEO knows they are not the strategic visionary or cultural leader needed for their company.
Some of these are definitely “is the juice worth the squeeze” resignations. For others, it simply has to do with wanting a new challenge. But, the faster technology changes, the more investment dollars that go into startups, and the greater the societal and governmental pressures impact tech companies, the more volatile the CEO seat will become in tech companies. Not to mention that needs to be compounded with generational changes with regard to career motivations/goals.
The bottom line is that it’s hard being at the top and only getting harder.
The 8-page Challenger, Gray & Christmas report had some great insights…
- The tech sector saw the second most CEO exits (only behind government/nonprofit).
- The tech sector numbers should be even higher as Challenger, Gray & Christmas separated FinTech and telecom from technology. There could also be some companies listed in other sectors (ex. electronics, health care, pharma, etc.) that are tech companies, so the number of tech CEO changes is higher than what is reported.
- Based on their data, 2021 should be in line with what we saw in 2020 and 2018, but nowhere near what we saw in 2019 when a staggering 1,640 CEOs left their posts.
The 17-page Heidrick & Struggles report is packed with some excellent data. Here’s some of what jumped out to us…
- Historical trends (dating back to 2018) show us that more resignations happen in the second half of any given year vs. the first half.
- Female and non-national CEO representation has seen a substantial increase over the past year. We will point out that since this is a global report, diversity metrics and what can be tracked vary greatly from country/region to country/region, so you will not see some of the DE&I categories that can be used in the US.
- More appointments are coming from within the organization.
- Companies are increasingly looking outside of the CFO and COO ranks to fill their CEO openings.
- Inc.: Jack Dorsey’s Resignation Letter to Twitter Reveals a Harsh Truth About Leadership Most People Never Learn
- Fortune: Jack Dorsey blasts other Silicon Valley founder-leaders for choosing ‘ego’ over their companies
- Forbes: Zappos CEO Is Stepping Down, A Year After Tony Hsieh’s Death
- Inc.: Jeff Bezos Quit His Job as Amazon’s CEO to Work on the Company’s Biggest Problem. It Could End Up Saving the Company