Industry Differences and Changes over Time in the Career Paths of Chief Executives
In this chapter we will return to some of the issues first raised in earlier chapters. These include the basic proposition that firms in different environments adapt different strategies and structures, different cultures, and different career patterns. This was first discussed in Chapter 2 and at more length in Chapter 3. In these chapters we saw that functional area was one factor that could influence early promotion opportunities. In Chapter 4, we discussed the issue of functional specialization versus general management as the route to the top, and the issue of inter-firm mobility in relation to upward mobility. Here we will examine the issues of how career paths differ across industries and how they change over time.
Much of the information on the functional backgrounds of CEOs comes from reports on the profile of the "typical" top manager. These studies look at all chief executives regardless of industry and imply that there is a tendency for CEOs to be chosen from particular areas. Conventional wisdom on this issue says that the functions of CEOs change with the critical challenges facing industry. For example, over the past 40 years the following functions have been emphasized: first production, then marketing, then finance, and most recently there has been a return to the production and technical areas. For example, in the early 1980s, much attention was paid to the replacement of financial expert Reginald Jones with the more technical- and operations-oriented Jack Welch as chairman of General Electric ( Landro, 1982). As the 1990s begin, this trend continues with the breaking of a long-term tradition at General