The big news in 1995 is that Operations/Manufacturing has broken out of last year's tie with Technical/Scientific as the preferred background of newly appointed CEOs. Management Practice Inc. (MPI) has just completed the twenty-second annual suney of CEO backgrounds to find that 26 percent of newly minted CEOs at the largest U.S. public corporations have Operations backgrounds, while 21 percent followed a Technical or Scientific route to the top. Both specialties dropped off from last year's peak of 30 percent of the incoming class.

For the total set of CEOs, Technical/Scientific at 24 percent was the leading route to the top of one of the largest American companies. In second place was Operations/Manufacturing, at 20 percent. Continuing to trend downward is Finance at 17 percent, tied for third with Marketing, which increased by two percentage points on a strong showing of 19 percent of the newly appointed CEOs.

                                                                   Newly

                          1991    1992    1993    1994    1995    Appointed



Corperations Sampled       518     510     503     461     464      80 



FUNCTIONAL SPECIALTY        %       %       %       %       %       %

Operations/Manufacturing    18      17      17      20      20      26

Technical/Scientific        19      20      21      24      24      21

Administration              17      17      18      15      14       8

Finance                     21      19      19      18      17      17

Marketing/Sales             17      19      17      15      17      19

Legal                        8       8       8       8       8       9

TOTAL                      100     100     100     100     100     100

Administration continues to fail off slowly, now down to 14 percent of the total sample. Legal trails at 8 percent.

MPI's inference from these findings is that boards of directors are focused on the product and service, both in ensuring optimum customer benefits and maximizing feasibility of manufacture and delivery. For new products, time to market (from design specification to first ship date) will continue to be a primary factor of competitive advantage.

Another interesting dynamic of this year's survey is the decline in the turnover of CEOs. In the 1995 update, 17 percent of the CEOs sampled were newly appointed, down from last year's 19 percent.

Notwithstanding the current supremacy of Technical/Scientific as the route to the top, an MBA remains the most frequent educational qualification. Over 29 percent of the CEOs in the survey hold an M13A, with over half of these having scientific or technical undergraduate degrees. Furthermore, among CEOs with MBAs, Hanard is more than four times as likely to be their graduate alma mater than any other school. Second is the University of Chicago, followed dosely by Wharton (University of Pennsylvania). Combining a technical undergraduate degree with a top-tier MBA is evidently an advantageous initial step on the route to the top.

One final note: there is now one woman in our CEO sample. Carol Bartz is CEO of Autodesk, producer of engineering software. When Ms. Bartz was named CEO of Autodesk (moving over from the presidency of Sun Microsystems) three years ago, it was not in our sample, but she has grown it into the 456th largest U.S. industrial company.