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Why is the turnover rate so high for technology leaders?


Oct 10, 2022

Nordstrom last week announced that Edmond Mesrobian, its chief technology and information officer since 2018, is stepping down, adding credence to the perception that turnover remains high for information technology executives.

A Korn Ferry survey of the top 1,000 U.S. companies by revenue conducted in late 2016 found that among five c-suite titles (CEO, CFO, CHRO, CMO CIO), the tenure of CIOs average 4.3 years, second lowest only to the CMO, 4.1 years.

“The pace of change is rapid and the breadth of increasing responsibilities continues to reconfirm the importance of the CIO role,” said Craig Stephenson, senior client partner, managing director, North America CIO/CTO Practice, at Korn Ferry, at the time. “CIOs continuously rise to the challenge and it’s common for this executive profile to leave after a few years, not because of dissatisfaction, but because the challenge they set out to accomplish is achieved and other, perhaps larger, opportunities await.”

According to a PWC survey, the failure of a major IT project is one of the primary reasons for a CIO dismissal. Also cited as causes were clunky inherited systems and lack of buy-in from key stakeholders.

According to articles on CIO.com, Forbes and elsewhere, strategic shifts and ever-expanding responsibilities due to rapid changes in technology, skills shortages, lack of advancement and burnout are other contributors to tech-exec turnover.

A Harvard Business Review article from last year concluded that the particularly-high turnover rate for chief data officers is due to “poorly defined” roles and “high expectations and low ability” to rapidly deliver data transformation that can take years.

Among other retailers, Starbucks, Walgreens, Kohl’s, CVS and Target are among those seeing changes in their tech c-suite this year. Nordstrom is seeking a replacement.

“We’re grateful to Edmond for his leadership and many contributions to our business, employees and customers,” Erik Nordstrom, CEO, said in a letter to employees attained by Women’s Wear Daily. “It’s clear that we’re in a much better place today than we were before he arrived. He has been a key contributor in building the architecture, infrastructure and resiliency needed for us to be a digital-first company.”

DISCUSSION QUESTIONS: What’s the reason for the apparent high turnover rates for CTOs, CIOs and other IT executives? What solutions do you see for supporting longer tenures, or are short stays inevitable?

Braintrust

“Longer tenures are possible with financial rewards that offer major bonuses or rewards when the technology proves its value upon use by the company.”

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