Economy

Dump the CEO, improve returns: study… Mobile phone how-to… Social networking blocked… Wine up, despite dollar

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CEO turnover up, insider replacements preferred

Watch your back CEO – you could be gone before you get to spend your fancy pay packet. New research by Booz Allen Hamilton shows that annual CEO turnover increased by 59% in the nine years 2006. In those years, cases where CEOs were forced out for poor performance increased by 418%.

The number of Australian CEOs leaving their job last year was 15%, slightly down on the 2005 high of 15.5% but above the international turnover average of 14.3%. Merger-driven turnover isn’t as common in Australia as overseas, at just 17%, but this reason for exiting doubled between 2003 and 2006, to 22%.

An Australian CEO’s average tenure is 7.4 years, close to the global average of 7.8 years, but overall since 2000 the average CEO stays at the helm for just 5.9 years, compared with a global average of 7.2 years. The tenure of sacked chiefs was three years, compared with 4.4 years since 2000.

Echoing a global trend, domestic companies are beginning to prefer internal appointments to replace head honchos, with internal applicants comprising 57% of successors. Insider CEOs seem to do better – pumping out a return of 21% compared to 17% for outsiders.

And CEO turnover is good for business, with companies undergoing “regular” changes outperforming the average company, with a return to investors of 5.3% compared to the average return of 3.1%.

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Help, I can’t use my mobile phone!

Mobiles phones can be complicated little gadgets, and PDAs even worse. If you’re not a tech-savvy sort, it can be difficult to work out all but the most basic phone functions, which can make the expensive purchase of the latest snazzy device a bit of a waste of time.

The Kiwis, who no doubt often find themselves as confused as the rest of us, have come about with a solution. Springwise reports that the New Zealand based Mobile Mentor company provides hour long one-on-one or group training sessions to teach people how to get the best out of their hi-tech mobile.

Mobile Mentor claims to have already trained 20,000 people, but if they were to leap the Tasman no doubt they could find a whole new pool of confused people keen to figure out how to send an email from their brand new BlackBerry.

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Businesses block social networking

Businesses are getting more and more inclined to restrict employee access to online social networking and web surfing, according to new research by IT company Barracuda reported by WebProNews .

The study found that 44% of businesses who use Barracuda’s filtering products block MySpace, 26% block Facebook, and 19% block both sites.

And a separate survey of IT professionals by Barracuda found that 53% of businesses restrict the range of sites that employees can visit, while 65% plan to implement surfing restrictions in 2008.

The main reason cited by businesses for limiting how widely employees can surf the net was concerns about spyware or virus prevention, but 52% cited dropping employee productivity as their main reason for acting.

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Raise your glasses to a lower $A

Wine exports are on the up-and-up, with demand from Britain and the United States defying the strong Australian dollar. This overseas performance is helping winemakers recover from the grape glut hangover from 2003, which slashed profit margins, and a poor harvest this year.

While domestic sales are down, exports grew 9.1% in the past 12 months, passing $3 billion for the first time in the 2007 financial year. Exports to Britain were valued at $982 million, while the US ran a close second with $953 million.

Industry players aren’t resting on their haunches, with worries the strong currency will continue to bite into margins.

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