Investors tend to complain about lack of vision in the current crop of executives, but Wall Street also tends to applaud managers who know nothing about the businesses that they operate.
Take the case of the Minneapolis, Minnesota-based retailer Target. Last summer, it appointed the insider Michael Fiddelke as its new CEO, and the company’s stock dropped 6.3 percent. Then look at German automaker BMW, which tapped a company veteran as its new CEO. Investors were largely unimpressed, but the stock remained unchanged. Apparently, some investors were looking for change — but only if that change came from an outside candidate.
Then, take the case of the Paris, France-based luxury goods firm Kering. Earlier this year, it appointed former auto executive Luca de Meo as its new CEO, and the company’s shares began rising immediately. Similarly, tech company IBM experienced a dramatically good turnaround under Lou Gerstner, who was hired as CEO in 1993 from RJR Nabisco, a food and tobacco conglomerate.
But not all cross-industry hires result in success. Apple provided a case of poor results with John Sculley, who was hired from PepsiCo in 1983, moving from the consumer goods sector to the tech industry.
And in some cases, hiring an outsider as CEO leads to outright failure. Nike’s decision to appoint William D. Perez as CEO in 2004 is reported to be one such example. Coming from S.C. Johnson, a consumer products company, Perez served at Nike from 2004 to 2006.
Similarly, coffee powerhouse Starbucks faced challenges with Laxman Narasimhan, who was hired as CEO in 2022 from Reckitt Benckiser, a consumer health company.
However, more young professionals seem to be encouraged to take roles outside their industry. According to executive-search firm Taligence, half of the executives who took a sports CMO job in 2024 came from a different industry, a proportion that rose to 67 percent in November of 2025.
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