Boards of directors are holding the reins much tighter and the CEO performance is under a much higher degree of scrutiny. Chief executives, like their lower level managerial and executive colleagues, do not have long to prove their worth. The average tenure among October announcements that identified length of service was only 6.3 years. CEOs, as well as lower rung managers and executives, are all victims of the New Economy, but in slightly different ways, according to Challenger. Everything happens much faster in the Internet-driven New Economy.
Information spreads instantaneously, competitors pop up overnight, market demand shifts on the fly.
Companies cannot afford to fall behind. As a result, CEOs are under a microscope and those who do not meet high expectations are quickly asked to leave. For managers and executives, the New Economy has forced companies to make drastic changes in order to remain competitive. Organizations are constantly being streamlined and decision-making authority pushed further down the corporate ladder so that the company can react faster to changes in the marketplace. However, as more decision-making authority has been handed down to middle managers and executives, so has accountability.