What's going on?

Shares of Burberry jumped more than 4%�on Monday as the British fashion house appointed a new CEO. The move is a tacit acknowledgement that the current CEO, Christopher Bailey, who is also the �Chief Creative,� was struggling with the dual mandate.

What does this mean?

The new CEO, Marco Gobbetti, is a veteran of luxury goods giant LVMH. The idea is that Mr Gobbetti can focus on the commercial and financial side of things while Mr Bailey remains in charge of the creative part of the business. Burberry has been suffering, along with other luxury brands, as sales have slumped (especially in China and Europe).

Why should I care?

The bigger picture: Luxury brands are undergoing a crisis – and that�s leading to lots of management changes.�China�s demand has fallen off a cliff as a crackdown on corruption has made it extremely untrendy (to say the least�) to flaunt expensive handbags and coats. Meanwhile, the rest of the world isn�t exactly experiencing a 1920s economic boom. And so a whole bunch of fashion companies are hiring new CEOs and brand managers, including at Hugo Boss and Gianni Versace, in an attempt to counter the malaise.

For the stock: Investors think it will be a much better leadership structure for Burberry.�It was a big ask for Christopher Bailey to run both the creative and commercial sides of Burberry�s business � and that�s especially true given the current challenging environment for luxury goods. The reaction of the stock price suggests that investors think this new setup is a much better idea.