Spain's Executives Don't Move Much

PRLog (Press Release) – Apr 14, 2007 – This is one of the key findings of a study on executive turnover in Spain produced by Jakobsland Partners. Here some of the causes: 1. Generous statutory formula to calculate severance indemnities, 2. Low geographical mobility, 3. High proportion of single income families,  4. Large number of small companies managed by their owners, 5. Growing supply of executives as baby boomers, born between the late 60's and early 70's, reach adulthood.

However, executive turnover in Spain has grown considerably in recent years, and it is foreseeable that the trend will continue in the future. Forced departures have increased as a result of mergers and acquisitions as well as performance based terminations. Voluntary turnover has also gone up since more companies poach executives from other organizations to fill their vacancies. Executive employment in Spanish-owned companies is much more stable than in foreign corporations while turnover rates in Madrid and Barcelona double those in other provinces. Turnover concentrates among males between 30 and 40 and during their first five years of tenure.

Spanish companies are getting conscious of the causes and consequences of growing turnover among their higher rank officers. They have started to include turnover rates in their scorecards, run satisfaction surveys and maintain exit interviews with leavers to understand their reasons. Among the negative effects of executive turnover they mention higher recruitment and training costs, loss of knowledge and negative impact on productivity. To prevent those issues they try to retain their top officers and high potential employees through a mix of recruitment, development and compensation initiatives.

Surprisingly there is little awareness about the risks of low turnover, a real problem for some Spanish companies. When employee turnover is high, a stable management ensures continuity and can preserve organizational efficiency, but when all the executives have been in their positions for long years a company cannot be as adaptable, innovative and competitive as another one whose management has been rejuvenated with some new blood.

About Jakobsland Partners:

Jakobsland Partners is a human resources consulting firm focused on executive employment and change management. Its service portfolio covers the entire cycle of executive employment, from recruiting to succession, including performance management and career development. Experts in organizational change, human resources audit and due dilligence processes. More information in www.jakobsland.com