Following is a letter sent to the Editor of the Financial Times:
Arun Sarin, the CEO of Vodafone, announces a profit of over €11 billion and his departure at the same time ("Five years of Sarin" Financial Times May 27, 2008). This is good news!
While he was criticised early on in his mandate, he appears to have found much favour with shareholders and brought the company he manages to a significant profit. That is usually a recipe for a CEO to stay on and on and on. And no shareholder was likely to stand up to him and ask him to go.
After five years at this high level, it is good for senior managers to go and find new challenges.
This is not about age but about tenure.
This experience should be repeated. What is the likelihood that we will see it happen more often?
Onésimo Alvarez-Moro
See article:
Few Manchester United fans would say that manager Sir Alex Ferguson has stayed too long – his 21st season has delivered two glittering new trophies – but when he started the job he was criticised for underperformance. By comparison, English soccer rivals Newcastle United are on their third manager in three years and fans were delighted to see the back of each humiliated coach. There is a lesson for business: nobody wants to keep a bad leader, but chief executives need time and they cannot work miracles.
The smooth departure of Arun Sarin as chief executive of mobile phone network Vodafone, after a respectable five-year stint, is a case in point. Mr Sarin had barely settled into his new office before coming under siege from investors angry about an attempt to buy AT&T Wireless of the US and the lack of payback from costly investments in new network licences and the purchase of Mannesmann of Germany.
See full Article (paid subscription required).
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