4/02/2005

Another Gone?

Stephan Newhouse, ex-president of Morgan Stanley, was demoted this past week for reasons not released to the public. After his demotion he refused offers to continue with the company and has decided to go elsewhere. This type of action has been one of several that has occurred lately, leaving the public to question the decisions of many large companies. Why are so many executives being fired? And do the firms believe their new presidents will be better for a longer period of time? It seems as though the tenure for people in executive positions is not very long, and is even declining. Could it be that the market is demanding newer ideas more frequently causing more demotions?

2 comments:

trudy said...

There are 2 reasons that the tenure of these executives are shorter than ever. Like professional sports, most teams (organizations) are looking for a quick fix. The athletes (exec's) are paid top dollar and because of that much is demanded.

Mack said...

I think that executives are given short term contracts and replaced regularly because it makes them easier to control.