14 August, 2012
Turnover rates in many sectors have begun to swing in favor of the C-suite. But for hotel executives, there is an increasing lack of job security and overall uncertainty in the industry.
According to a recent study from global executive search firm HVS Executive Search, CEO turnover doubled in 2011 amongst the world's 50 largest hotel companies. 12% of companies surveyed have a new leader at the helm, reported industry website Bighospitality.
The hospitality industry is becoming more conservative in selecting candidates during executive hiring searches, with appointments generally coming from within the hotel industry.
"During the early days of the global economic meltdown, we certainly witnessed shareholders and boards electing to either stick by their management teams and support them out of recession, or to make a quick change and recruit a CEO suitable for the tough times ahead," noted Chris Mumford, HVS President for EMEA and co-author of the study.
Mumford also speculated that boards are losing patience with executives who have been unable to lift their companies out of the doldrums of the recession. "As we look ahead to the next two years,” he said, “we anticipate that changes will largely be driven by economic conditions; a company with financial stability and an aggressive growth strategy requires a different leadership skill set to one in survival mode."
The profile of the typical hotel CEO is also changing, as younger executives are making their way to the top, reported Hotel Industry Magazine. This is attributed to the entrance of Chinese hotel companies, which tend to have younger CEOs, into the ranks of the industry’s biggest players. North American and European hotel CEOs, typically in their early 50s, are roughly six years older than their Chinese counterparts.
The growing presence of Chinese companies in this group points to globalization in the hospitality industry as well as a greater number of international brands. As searches for hotel chief executives broaden geographically, it might be expected that executive searches will also reach outside the industry to tap into a more diverse pool of candidates.