US Food Executives Dropping Fast
In what people are calling an ‘open season’, US food executives have been dropping fast from Big Food companies.
Since May 2016, an unprecedented number of CEOs and executives have been replaced with new hires.
Food executive switches
The first to go in May 2016 was the CEO of Smucker's, who was replaced by his nephew after 15 years in the role. Although it kept the company within the family, it triggered what seemed to be a wave of change throughout the US food industry.
Hormel changed their chief executive in October, then in December Tyson did the same. Walter Robb stepped down as co-CEO of Whole Foods by the end of the year, leaving John Mackey as the de facto leader. On the same day, Paul Bulcke ended his eight-year tenure at Nestle.
It was a big time for food recruitment, and the changes did not stop there. This spring saw the departure of Muhtar Kent as head of Coca-Cola after eight years, and Ken Powell left General Mills just before he reached ten years with the company. Then it was Irene Rosenfeld retiring from her CEO post at Mondelez after more than a decade in charge.
The result is that 17 CEOs from companies regarded as Big Food manufacturers had left their positions by the end of about as many months. “This is a pretty unprecedented situation where you see that level of turnover in such a short space of time,” says Bernstein analyst Alexia Howard.
What’s causing it?
Opinion is divided on what may have caused this many quick moves. It could be mere coincidence, of course – CEOs do tend to step down after a significant number of years in charge, as the stress of the position together with the age of those holding it tends to mean it can’t be a job they keep forever. But others think that we could be approaching some kind of milestone moment for the food industry in the US.
“There’s never been a time that’s more challenging for a CEO in the industry,” says David Garfield of consultancy AlixPartners. “They’re facing unprecedented change.”
Some feel that the climate of Big Food has changed, and that CEOs who have been in their positions for a while are craving a return to latter days – and no longer want to hold their position now that things are different. Marketing has become a whole different beast, and many heritage brands are now having to fight tooth and nail to retain their place in the market against younger, savvier companies. Tastes have also changed, with a swing towards organic, gluten-free, vegetarian, low-sugar, low-fat, and fresh produce.
“Consumers have lost trust in legacy food products,” says Howard. “As a result we’re seeing big packaged-food companies attacked from all sides.”
Not only that, but many large brands have started to cut costs (and potential profits) in favour of presenting the lowest prices for customers. This means that older brands are, again, struggling to adapt.
“The pace of change is increasing so much,” says Gaurav Gupta of strategy firm Kotter International. “What business needs today and five years from now are going to be dramatically different.”
Whatever the cause, it’s great to see so many high-powered food jobs coming onto the market at once. These kinds of opportunities don’t tend to come up so often, and for those who are hungry to cut their teeth in their first high-powered positions, it’s a time drenched in opportunity. Not only are the Big Food positions available, but also the newly-vacated positions of those who have risen up to take the first seats.