Swiss managers play musical chairs

Rudolf Hadorn (left) became Ascom's sixth CEO since 1990 when he took over from Juhani Antila Keystone

Swiss managers are paying the price for the weak economy, as many underperforming companies replace their top bosses.

This content was published on July 13, 2004 minutes

But firms with solid results have shown themselves less likely to reshuffle their boardrooms.

In 2003, over ten per cent of CEOs of leading companies in German-speaking Switzerland left or lost their jobs, according to consultancy firm Booz Allen Hamilton, which polled 2,500 companies.

That number is expected to increase further in 2004.

“Managerial changes are accelerating,” said Christian Muggli, a partner at another consultancy firm, Egon Zehnder International. He added that management errors could not be covered up in a sluggish economy.

“Today, you cannot sit back if your company is not generating revenue,” he explained. “If the results aren’t there, management will be changed, something which is perfectly justified.”

Top managers at the well-known Swiss companies Forbo, SIG, Lonza and Loeb have recently been replaced following unsatisfactory results.


But not every manager in Switzerland is quaking in his or her shoes at the prospect of bad results.

At multinationals such as Novartis, Roche or Nestlé, changes are few and far between. And they are most likely to happen when a company reaches the end of a restructuring phase.

Two recent examples are Credit Suisse Group and ABB.

The Credit Suisse management duo of John Mack and Oswald Grübel has been trimmed to one with the non-renewal of Mack’s contract by the board. But Grübel’s nomination as sole CEO of the banking group comes after the two men successfully restructured it.

ABB headhunted Fred Kindle from Sulzer, to replace Jürgen Dormann as the managing director of the Swiss-Swedish engineering group. Dormann is now concentrating on his activities as chairman of the board.

Telecommunications specialist Ascom is used to change. Juhani Antila, a Finn, handed the CEO position over to the head of finance, Rudolf Hadorn, making him the company’ sixth managing director since 1990.

New jobs

Another factor is that managers are often lured away by tempting offers from other companies.

ABB’s chief financial officer, Peter Voser, had set his heart on the top job, but when the board chose Kindle, he left for the Royal Dutch/Shell oil company.

Life isn’t so tough for top managers who have been pushed out of their jobs. The survey shows that most find a similar position with another company quickly.

And they are normally well compensated, occasionally receiving a payoff worth millions of francs.

“There are some losers, though,” warns Muggli.

The former Swissair Group CEO, Philipp Bruggisser is still looking for a new career opportunity, while André Dosé, the erstwhile head of Swiss, the national carrier, has begun writing what he can only hope will be a bestseller.

swissinfo with agencies

Key facts

Over 10% of all CEOs in German-speaking Switzerland changed jobs in 2003.
According to consultancy firm Booz Allen Hamilton, this number should increase in 2004.
Globally, the change rate is closer to 9.5%.

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In brief

When the economy slows, top management changes more often.

Consultancy firms see two reasons for this:

In a bad economic environment, management errors cannot be hidden behind good results.

Company boards are more likely to implement top-level changes if they are dissatisfied with company results.

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