How to get the corner office-key factors about Fortune 100 executives and their education
A recent study examining the career profiles of top executives in Fortune 100 companies has some good advice for young, ambitious managers targeting the top echelon.
Good education, wide general knowledge, patience, and a good mix of internal and external moves all help a bid for the corner office. The research, which examined the key factors in successful executive careers in 1980, 2001 and 2011, found that education definitely counts. Executives in top-tier positions in Fortune 100 companies are five times more likely to have graduated from an Ivy League university than their counterparts in tier-three positions. They are three times more likely to have done an Ivy League MBA, especially if they were hired from outside the company.
“Elite institutions can still shape career paths in very visible ways. Top-tier education pays off,” says Monika Hamori, professor of human resource management at IE Business School, who conducted the research with her colleague assistant professor Rocio Bonet and Wharton School professor of management Peter Capelli.
According to the findings, Hamori explains, managers with a narrow area of specialisation get coveted promotions quicker, but they do not usually rise to tier-one positions. Chief executives, chairmen and chief operating officers are likely to take a more “generalist” route, gaining experience in more jobs with a wider scope.
“General management takes longer, but it is the best way to reach the top,” she says.
Length of tenure with the same employer has increased. Also, in 2011, executives took longer to reach senior positions than their counterparts in 2001.
“The 2008 financial crisis has slowed down executive career paths. There are fewer positions available and executives are not so willing to venture out to other corporations in the hope of landing an attractive position,” says Hamori, who advises patience until the effects of the economic slowdown are over.
Instances of a full career with the same company have drastically fallen since 1980, with executives finding it best to balance internal and external moves as they advance. However, job hopping too often is not advisable.
“When we analysed the career histories of the top executives of 2011, we found that the average executive worked for fewer than three companies,” Hamori says. “My advice is that if you jump between companies, then make sure that the next time you spend a longer stint with an employer and do your best to be promoted there.”
According to the study, there is greater diversity today than in 1980 in Fortune 100 companies and opportunities to get to the top have improved for both women and executives born outside the US.
“First of all, we see increasing diversity in the top echelon. In 2011, 18 per cent of top executive positions were held by female executives, a considerable increase on 2001, when 11 per cent of these jobs were filled by women. It is also a huge jump compared to 1980, when the proportion of women was zero,” Hamori says. This has been helped by broader trends within the Fortune 100. It now includes fewer heavy industries and energy companies, which employ fewer women, and more health care and retail enterprises, which employ more. Hamori adds that women usually stay in second- or third-tier positions. Only 6 per cent are in top-tier roles such as chief executive or chief operating officer.
In 2011, around 11 per cent of Fortune 100 executives had been educated outside the US, but 77 per cent of those come from English-speaking countries. The rest come from a broad range of countries, including Switzerland, Germany and Italy.
“Being a native speaker of English seems to be a requirement for most of the top-level positions,” Hamori says.
The research shows that the employment landscape is uncertain as the effects of the 2008 financial crisis continue to play out. It also points out that traditional recruitment methods are largely begin replaced by the new technology, with Facebook and LinkedIn often used as tools for hiring and background research.