Who'd Want to Be CEO Anyway?
IRCO, Burson-Marsteller
2006


Getting to the top demands great personal sacrifice. Spanish managers know this, and they are increasingly reluctant to pay the price. The rewards of being CEO "are not enough." So we learn from the report "La gestión empresarial en los años 2005-06" ("Business Management in 2005-06"), prepared jointly by the IRCO research center at IESE and communications consultants Burson-Marsteller.

Now in its 14th edition, the survey has become a touchstone for anyone interested in executive opinion and management trends in Spain. The focus this year is on the role of the CEO, and the CEO's influence on a company's reputation, competitiveness and business success. The authors also offer some recommendations for the present government.

The Tough Life of a CEO
The report reveals that 31.8 percent of Spanish managers definitely want to be CEO; 14.5 percent definitely do not want to be; and 9.3 percent maybe want to be. The main reason given for not wanting to be CEO is the perceived difficulty of combining CEO responsibilities with personal and family life (29 percent). The second and third most important reasons are the inordinate stress the job involves (22.6 percent) and the inadequate compensation, which does not always make the effort worthwhile (25.8 percent).

Another interesting result is the high percentage (79 percent) of managers who consider it more difficult to be CEO today than it was 10 years ago. The explanations given for this opinion, in order of importance, are: having to attend to and mediate between too many stakeholders, lack of work-life harmony, and over-zealous supervision by the board of directors.

The respondents believe that being CEO gives a manager an opportunity to take on new challenges (63.2 percent) and to put his or her own ideas into practice (47.1 percent). However, there are two sides to the coin. A substantial proportion of managers give up any ambition of becoming CEO because of the difficulty in achieving a satisfactory balance between work and personal life (29 percent), the unacceptable level of stress being CEO involves (22.6 percent) and the meager rewards, which in many cases are not worth the trouble (25.8 percent).

Reputation is Key
The survey shows that a company's reputation is closely bound to that of its CEO. Some 38.4 percent of the respondents believe that between 50 percent and 90 percent of a company's reputation depends on the prestige of its CEO. Given the impact they can have on a company's financial value, the personal qualities of the chief executive have become a priority for many companies. The most highly valued qualities are credibility, the ability to foster fluid communication within the company, and the ability to put together and maintain a highly skilled management team. Conversely, the main contributing factors to CEO failure, according to the respondents, are poor execution, leading to loss of credibility (68.8 percent), and lack of strategic vision (61.6 percent).

By far the most admired CEO is Bill Gates, followed by the celebrated leader of General Electric, Jack Welch. At the top of the list of chief executives of Spanish companies are Emilio Botín and Amancio Ortega.

Dwindling Competitiveness
The survey results reveal a concern for the competitiveness of Spanish companies. In the respondents' opinion, Spanish companies have become less competitive both at home (37.4 percent) and abroad (58.9 percent). The most important factors driving this deterioration are the government's political and economic measures (36.4 percent), offshoring (36 percent), and changes in business mentality (28 percent).

Some 60.7 percent of the managers surveyed consider the leisure and tourism industry to have the brightest future in Spain. Next in line are construction (28 percent) and telecommunications (27.6 percent). The sector with the poorest outlook is food and agriculture (2.8 percent).

Labor market reform is another significant concern for Spanish managers. According to 70.1 percent of the respondents, the government should seek alternatives to the open-ended employment contract. The second recommendation is to relax employment regulations in order to facilitate dismissal and compensated layoffs (67.3 percent). The third recommendation is to promote part-time employment (53.1 percent).

With a view to preventing any rise in unemployment due to offshoring, 85 percent of the Spanish managers who took part in the survey think training for the unemployed is the most important thing, in order to enhance their employability. Other options include promoting the establishment of RDI centers in Spain, and coordinating public-private "manufacturing cluster" initiatives.

Another suggestion is that the Spanish government should proactively encourage investment by Spanish companies in the countries of Eastern Europe. The respondents see this as something the present government has failed to do, demonstrated by the fact that 72 percent of them believe that Spanish companies are not investing enough in the new EU member states.

The low opinion of the government's record on immigration, reported in previous years, persists in this latest survey (48.1 percent). Indeed, the proportion of the managers surveyed who consider current immigration laws unsatisfactory has increased (21.5 percent).