Posts Tagged ‘college education’

Restaurant Careers: The Path From Dishwasher To Chief Executive Officer May Now Include A Stop At Harvard

Sunday, November 28th, 2010

For years the food services industry has been labeled an industry for low pay and low skills. Research recently completed by Plummer & Associates, an executive search firm, shows quite the opposite. The food service industry now has highly educated leaders.

This new study on the education of Chief Executive Officers at the top 100 food service chains in the United States shows that today over 68% have college degrees. This study also shows a growing trend of CEO’s with advanced degrees as 18% hold MBA degrees, 2% hold MA/MS degrees, and 4% hold JD degrees.

For years the food service industry was known for its career path from ‘dishwasher to CEO’. Our research indicates that while this may have been a viable path in the past, the current trend is for a minimum of a college degree and there is an increasing importance placed on advanced degrees. This demonstrates the importance of the sophisticated intellectual tools and the strategic vision gained through higher education.

Like with other segments of the retail industry, the food service sector has consolidated from regional companies led by founding families into massive, complex businesses requiring sophisticated tools to manage them effectively. This new breed of food service businesses are intensely competitive and are constantly looking for cost and marketing advantages to enhance their market position.

According to Plummer & Associates, some of the complexities facing the food service industry demand a command of the following disciplines:

 Marketing – Sophisticated tools have elevated the ability to forecast demand and to measure customer buying pattern changes. These tools also help measure brand awareness, customer loyalty, and the return on investment for all marketing programs. With the advent of social network marketing, the methodology of communicating with the customer is changing.
 Merchandising – Food trends and tastes are constantly evolving. To create a competitive edge it is important that food service organizations be active in planning product life cycles, assortment strategies, and new product introductions backed by a superior product development process. All these strategies must mesh well with operations to prevent overwhelming production and unnecessarily impacting quality and costs.
 Supply Chain Management/Logistics – Today there are tools available to help food service companies secure significant cost advantages throughout the supply chain while simultaneously improving the quality of customer service. This can provide organizations with a significant advantage over competitors.
 Finance – This function has quickly progressed from recording history to active involvement in ‘creating value’ through analytics. This is important as the company competes in the market for capital.
 Legal – Our society has become more litigious making larger businesses more of an attractive target. The complexity of new regulations has resulted in an increase of the legal staff. A food service leader is now required to be more involved and responsible for setting the tone of legal strategies.
 Human Resources – Once considered just an expense, Human Resources managed effectively must now create differentiation versus the competitors. A company’s talent and culture, including a devotion to the customer, are now more important than ever.
 Information Technology – In the past, technology seemed to be the sole domain of the IT department. With advanced POS systems, the food service organizations learned the power of information and the ability to forecast demand by day part. Now, leading IT departments interrelate with the entire organization by providing useful information to aid in decision making, control costs, forecast and analyze. Companies are now operating enterprise wide systems and it is becoming mandatory that the CEO know the capabilities of these systems to ensure the company gains a competitive edge.
 Global Reach – The days when food service companies only operated stores in the U.S. with product secured from U.S. sources are long gone. The implications of global activities are enormous.

Forward thinking food service companies such as Pepsico (Yum!) and Pillsbury/Grand Met (Burger King) who saw the need for talented executives started recruiting programs to attract students from colleges and also actively recruited MBA’s. These recruiting programs are responsible for the majority of CEO’s now leading the food service industry.

For those who are looking to progress up the ladder in food service, the data demonstrates that it takes more than experience in the industry to become a CEO. The food service business now requires the sophistication that comes with a college education and the trend shows an increasing demand for the additional tools gained in an MBA program.

The research shows that a college education is far more important than the particular school attended. While Ohio State University produced three CEO’s, the University of Kentucky produced two, and the University of Central Florida produced two, no other school produced more than one. On the other hand, in regards to CEO’s with MBA degrees, the Graduate School of Business at Harvard University produced four which is statistically important. Close behind is the University of Chicago producing two. It is clear that the industry prefers graduates from the top tier graduate business schools.

Retail Executives: Education of the Highest Paid CEOs

Tuesday, August 31st, 2010

In 2009, our firm published an article (listed below) indicating the level of higher education held by the CEOs of the top 100 retail companies. We have now identified the ten currently highest paid retail executives and have discovered that this group confirms our previous study. The complexity of the retail business is such that executives who possess the most intellectual tools rise to the leadership roles. The statistics are as follows:

Education of Highest Paid CEOs             Education of Top 100 Retail CEOs

BA degrees                 90%                                             85%

MBA degrees              10%                                            23%

JD degrees                   10%                                             6%

According to our research, the following executives fall into the category of the top ten highest paid executives. Total compensation for each is based upon current public records of publicly traded retail companies in the U. S.

Andrea Jung. Chairman and CEO – Avon

Total Compensation: $13.7 million

Education: Bachelor’s – Princeton University

Michael T. Duke. President, CEO and Director – Wal-Mart

Total Compensation: $13.3 million

Education: Bachelor’s – Georgia Tech

Terry Lundgren. Chairman, President and CEO – Macy’s

Total Compensation: $8.7 million

Education: Bachelor’s – University of Arizona

Francis S. Blake. Chairman and CEO – Home Depot

Total Compensation: $8.3 million

Education: Bachelor’s – Harvard College

JD – Columbia University

Myron E. Ullman – Chairman and CEO – J.C. Penney Company

Total Compensation: $8.0 million

Education: Bachelor’s – University of Cincinnati

Trudy Sullivan – President and CEO – Talbots

Total Compensation: $6.9 million

Education: Bachelor’s – Manhattanville College

Katherine L. Krill – CEO, President and Director – Ann Taylor Stores

Total Compensation: $6.9 million

Education: Bachelor’s – Agnes Scott

Robert A. Niblock – Chairman and CEO – Lowes

Total Compensation: $6.1 million

Education: Bachelor’s – University of North Carolina

Gregg W. Steinhafel – Chairman, President and CEO – Target

Total Compensation: $6.0 million

Education: Bachelor’s – Carroll College

MBA – Northwestern University

Carol M. Meyrowitz – CEO – TJX

Total Compensation: $5.7 million

Education: no degree

Following is the study we released in April, 2009, on the education level of the CEOs for the top 100 retail chains.

TOP RETAIL EXECUTIVES HAVE TOP EDUCATIONS!

A new study conducted by Plummer & Associates on the Chief Executive Officer education at the top 100 retailers in the United States shows that today over 85% have college degrees. This represents a significant increase over Plummer & Associates’ 2002 study that showed only 60% had earned college degrees. The number with advanced degrees has remained about the same; however, the new study shows the breakdown at 23% with MBA degrees and 6% with JD degrees.

Does this continuing trend mean that the industry can no longer be led by the person who starts with a push cart? Our research shows that while working your way to the top may have been a viable career path in the past, the constantly evolving and complex nature of today’s retail landscape requires that executives must couple their ground up experience with the sophistication and strategic vision gained through earning a college degree.

Retailers have consolidated from regional companies led by founding families into massive, complex businesses requiring sophisticated tools to manage them effectively. This new breed of retailers is intensely competitive and constantly looking for cost and marketing advantages to secure their market position.

Some of the complexities facing retailers today demand a command of the following disciplines:

  • Marketing – Sophisticated reporting systems have elevated the ability to forecast demand, measure customer buying pattern changes, brand awareness and customer loyalty, and help build brand value. Each retailer now operates through more than one channel, (retail, e-commerce, catalog, direct marketing) requiring that the decisions made for each channel are highly strategic.

 

  • Supply Chain Management/Logistics – Today there are tools available to help retailers secure significant cost advantages throughout the supply chain while simultaneously improving customer service. This gives retailers significant competitive advantages.

 

  • Merchandise Management – Advanced technologies are now required to source merchandise for product development, assortment planning, SKU rationalization, customer knowledge, trend analysis, and inventory and category management. The most important part is using these technological advances to increase profitability.

 

  • Finance – This function has quickly progressed from recording history to active involvement in creating value through analytics and is now vital in allowing a retailer to compete for capital against all other industries.

 

  • Legal – Our society has become more litigious making larger businesses more of an attractive target. The complexity of new regulations has resulted in an increase in legal staff. A retail leader is now required to be more involved and responsible for setting the tone of legal strategies.

 

  • Human Resources – Once considered just a major expense, Human Resources managed effectively must now create differentiation versus competition. A company’s culture and devotion to the customer are now more important than ever.

 

  • Information Technology – In the past, technology seemed to be the sole domain of the IT department. With advanced POS systems, the retailer has learned the power of information and no longer relies solely on market information provided by the vendor. Leading edge IT departments now interrelate with the entire organization by providing useful information to aid in decision making, control costs, forecast, and analyze. Companies are now operating enterprise-wide systems and the CEO must know the capabilities of these systems to ensure the company gains a competitive edge.

 

  • Global Reach –The days when retailers only operated stores in the U. S. with product only secured from U. S. sources are gone. The implications of the global activities are enormous.

 

Forward-looking retailers who saw the need for talented executives brought highly educated executives into the retail industry. In the late 60s and 70s the retail industry started recruiting top students from colleges and graduates from MBA programs. The top leaders at that time were: Jewel Tea, Federated Department Stores, J.C. Penney Co, Sears Roebuck & Company, Kroger, The Dayton Hudson Corporation, and The May Department Stores Company. Those recruiting programs have produced many of the CEOs of today’s successful retailers.

For those looking to progress up the ladder in retail, the data indicates that the career path from bagperson to CEO is no longer viable, nor practical. Retailers striving to be successful must compete for the best educated. And future leaders in retail must strive to educate themselves and that education must include minimally the rigors of earning a bachelor’s degree. Earning an MBA and/or a JD degree greatly improves one’s chances. This is not because one needs a degree to punch up a resume; rather it is the intellectual tools gained through formal education combined with on-the-job training that prepares an executive for the rigorous and evolving challenges facing retailers today.

While the 2002 study indicated no particular school had the lead in producing future CEOs, the current research indicates that a new trend is starting to develop. Harvard University has taken the leadership position having five CEOs with undergraduate degrees and five with MBA degrees. Second is The University of Pennsylvania’s Wharton School of Business with three CEOs holding an undergraduate degree. Columbia University and the Kellogg School of Management at Northwestern University are tied with three CEOs each holding MBA degrees. The University of Illinois has three CEOs with undergraduate degrees.

It is clear the retail industry needs to compete in the market place to bring the brightest talent with superior intellectual tools and education to manage the business for the future.

Retail Executives: Are you a job hopper?

Friday, July 23rd, 2010

One of the worst labels an executive can get is “job hopper”. This is an executive who has had multiple employment changes in a short period of time.

In the eyes of the prospective employer this raises many red flags. Job hoppers are usually the first candidates to be ruled out by employers and search firms as there are so many good candidates who don’t carry this baggage.

There are many reasons for too many career changes. These can be:
-unfortunate circumstances
-bad choices
-bad timing
-incompetence/malfeasance
-the idea that one should always be looking for the next job
-listening to a self-interested recruiter who wants the executive to move on to earn another fee.

We all make bad choices. Once is understandable. After that, it is a reflection upon the individual’s personal judgment or his/her inability to do good due diligence before accepting new employment.

Obviously, the executive who changes employment because of incompetence or malfeasance is always eliminated.

Just as importantly, the one who is always looking for his/her next job with another employer is also eliminated from candidate slates. The reason is simple. Employers are not simply looking to fill a position. They want someone in whom they can invest for future returns.

The tough issue is for those who ran into unfortunate circumstances.
-They had to leave an organization because of personal or family illness
-The family ended up not making the move or could not accept the new city
-The executive who followed a superior to a new company and accepted the superior’s due diligence on the new company which failed shortly afterwards.
-The new employer was acquired or new management was installed that terminated current employees.
-The economy tanked in 2009.

One of these events in a career is understandable. But two or three such events make it difficult to avoid the deadly job hopper label. Be honest and factual when you describe the circumstances to a prospective employer. Covering up your mistakes will only hurt you.

If you are labeled as a job hopper, it is very similar to having a low credit score. You can work your way out of it. You need to be dedicated to your new employer and committed to building your new career in that organization.

If you are tempted to make a jump simply to catch up with your peers, consider that you may be about to commit a fatal error.