High management turnover is unsustainable, report warns
for about a year as the industry shifts from long-term vision
management to quick fix solutions, a report has found.
Last year a staggering 589 new directors were appointed to the UK's leading 500 companies, a record number, Plimsoll Publishing found. They said this is an "unsustainable position". Analysts concluded that this situation is potentially putting businesses under severe financial pressure, which in turn could effect a company's competitiveness. Around a third of businesses are already loosing money because of high management turnover. This turnaround culture also means new directors can "easily slip away" leaving others to pick up the pieces, Plimsoll warned. In wake of the findings, companies could do more to inspire company loyalty in newly-appointed leaders. Profile Plimsoll looked at the profile of business leaders across the food manufacturing market. However, it has not released the full report to the media. Nor has it explained how it came to the conclusion that the average director is called David. Plimsoll also concluded that the average director is 53 years old and earns £129,005 per year, up from £122,213 last year. The youngest director on the board of a food manufacturing company is aged just 23, whilst the oldest is 93. David Pattison, senior analyst, said that firms are all too keen to keep tabs on their customers but often fail to notice new management. Pattison said: "If you are dealing with these companies it goes unnoticed that new management has been put in charge. People are quick to credit check or search to keep and eye on their customers, suppliers or competitors, yet don't even notice when key management is replaced." Pattison said that when owner-directors either sell up or retire, a new wave of management emerges which does not have the same ties to the company and are free to move when they feel like it. He added: "There is a strong argument that business behaviour is heavily influenced by this style of management, as the emphasis switches from security, financial prudence and long term vision, to quick fix solutions. I don't think it's any co-incidence that a third of food manufacturing companies are losing money at the minute as the cavalier management chase the kudos of sales."
