Less choice, higher demands: Companies that currently have a top management job available often face a double problem. Firstly, the shortage of skilled workers and the “war for talent” mean that fewer qualified candidates are applying for management jobs than before. And secondly, the demands placed on those on the move have increased to such an extent that experience and leadership alone are no longer enough.

Today, top managers are supposed to act “ambidextrous”: “They should optimize existing processes and at the same time develop other, new business areas,” says

Kaan Bludau

, founder of the Frankfurt-based HR consultancy Bludau Partners. These two tasks – trimming the store for efficiency and opening up new business areas – were previously Often spread across several positions, more is expected of top managers today: they should be efficient as well as flexible and innovative.

Above all, the pressure to innovate is high. Being a “steward of the calm waters” is not enough. Instead, it is all the more important to adapt more quickly to changing market conditions. “Managers have to come up with new ideas and implement them at ever shorter intervals,” says Bludau. Numerous restructurings in large companies show that the market is moving ever more quickly: The Amazon subsidiary Twitch recently announced a change in strategy. The AI ​​developer OpenAI constantly reviews its business processes in order to defend its pioneering position. And the software heavyweight SAP is radically restructuring and investing in the cloud and AI in order to secure its market share in the future.

Renew instead of just manage: In personnel interviews, managers are increasingly tested on their ability to quickly adapt to a new situation, explains Bludau.

New topics determine job interviews

Artificial intelligence (AI) applications provide managers with powerful tools to respond more quickly to new trends. Whether this will be a blessing or a curse remains to be seen. But one thing is already certain: top managers not only have to promote the use of AI technologies and create resources. You also need to understand these technologies yourself. “This is new,” says Bludau.

Today, managing directors have a dual mediating role that works in two directions: Firstly, they have to communicate the meaning and purpose of these new technologies “downwards” (to employees and middle management) and allay fears. Secondly, you must also communicate the effects of these technologies “upwards”, i.e. to boards of directors and stakeholders. “In the past, decisions were often made too timidly because people underestimated the importance for their own business and the market,” says Bludau. Top managers often have to delve deeply into the subject matter in order to convince supervisory boards and business partners.

Ambition alone is not enough

Flexibility, persuasiveness, deep understanding of new technologies: The new requirements offer many opportunities for job seekers these days, but also represent high hurdles. Ambition alone is not enough: many people want to lead in such an environment, but only a few can actually do it. “Not every person is suitable as a managing director. Many important qualities cannot be trained,” says Bludau. This also includes empathy for employees, because employee loyalty has become much more important in times of a shortage of skilled workers.

But where do these “ambidextrous”, innovative and team-oriented top talent come from? Due to a lack of external applicants, many companies would simply position experienced employees from middle management in managing director roles for which they are not necessarily suitable. Managers are often confronted with completely new areas of responsibility, the fulfillment of which overwhelms many people. “That’s a problem,” Bludau also knows. “That’s why it’s so important to compare expectations and skills through various tests and selection interviews.”

Loopholes in contracts

And what if the newly promoted manager doesn’t meet expectations? Companies are increasingly trying to protect themselves in this case. They often use contractual loopholes to get rid of unpleasant managers, reports Berlin labor lawyer for top managers

Christoph Abeln

. For many managers, this is often not immediately obvious or not important at first. Some are so blinded by the new decision-making position, prestige and bonus payments that they do not initially notice that they are falling into a trap.

While the task profile in the new position is constantly growing, many new managers would lose sight of the fact that there is no suitable contractual basis for their change of position. The trick of many companies: to keep managers on the job through certain clauses on the basis of a simple employee relationship and thereby create vague task profiles. “I’m seeing this more and more often at the moment,” says Abeln. “These are usually top performers who are highly motivated to take on their new position and often forget important details in their contract. The consequences are difficult to recover from.”

An example: A client of Abeln is appointed managing director of a subsidiary and in practice is given new tasks and a new contract that, on paper, still contains old tasks. Abeln calls these coupling contracts. The problem with such contracts: In the new role, the managing director is an organ of the company and no longer an employee. He represents the company externally and has no protection against dismissal because he no longer complies with the “principles of hazardous work”. He is therefore fully liable in the event of negligence; depending on the type of company, he can also be held liable with his personal assets. However, his task profile has not changed. In this way, companies can pin him down to unfulfilled tasks and force him out if he doesn't perform according to certain wishes, says Abeln.

Another risk of “promotion”: According to case law, the new managing director service contract also ensures that the written form for terminating the previously existing employment relationship is guaranteed. In case of doubt, protection of existing rights, protection against dismissal and length of service are lost.

Long disputes in the regional courts

For the managing directors who have been dismissed, this almost always means a checkmate. Because of the coupling agreements, disputes do not have to be settled before the respective labor courts, but rather before the regional courts. This often means higher costs and a longer process. “Especially for younger managing directors, a long process can also be a career risk,” says Abeln. Anyone who has been in court with their ex-employer for years often appears less attractive to a future employer.

Accepting mistakes, learning from them, making things better: Compared to the USA, the culture of mistakes in Germany still has room for improvement and is only slowly being accepted. This is exactly what has been discussed in theory for a long time: managers who can deal with their own mistakes and the mistakes of their employees would build trust and ensure psychological safety. But such top managers are still rare in German companies, says Bludau. Although the ability to work in a team is increasingly required, it is not demonstrated in top management.

“But companies have recognized this and also see the danger of false signals being sent into the company,” says the HR consultant. Potential managing directors and top managers are now being tested more frequently to see whether they can integrate into the existing management team and are generally a team player. “Candidates have to have this on their minds if they want to have a career.”