Ma, Yao

2022-8-9, Ma, Yao, Miedtank, Tina, Jonczyk Sédès, Claudia

2021-7-29, Ma, Yao, Jonczyk Sédès, Claudia, Georgakakis, Dimitrios

We study the effect of new CEO succession origin on strategic change in firms facing turnaround situations. Taking a ‘relational perspective’ of CEO succession, we argue that the degree to which outside CEO succession associates with strategic change depends on the relational network between the outside CEO and key incumbent executives prior to succession. Using data from 108 companies with new CEOs in turnaround situations between 1993 and 2015, we find that high CEO outsiderness has a negative effect on strategic change in firms facing turnaround conditions – while this effect is weaker in the later years of the new CEO’s tenure. We further find that outsider CEOs with more connected intra-TMT network brings a higher degree of strategic change to the firm early after succession. Overall, our paper contributes to the extant literature on CEO succession by underscoring the important role of the relational CEO-TMT interface when a new CEO takes charge with the mandate to bring about strategic change (i.e., in turnaround conditions).

2022-7-8, Ma, Yao, Jonczyk Sédès, Claudia, Georgakakis, Dimitrios

2021-7-8, Ma, Yao, Jonczyk Sédès, Claudia, Georgakakis, Dimitrios

Extant research on Chief Executive Officer (CEO) succession has long questioned whether the appointment of a new CEO is beneficial, or detrimental, for firms facing conditions of financial distress (Finkelstein, Hambrick & Cannella, 2009). Our paper attends to answer this question by adopting a relational perspective to study the link between new CEO succession origin and strategic change in turnaround conditions. Specifically, we argue, that the degree to which outside CEO succession associates with strategic change depends on the relational network the outsider CEO has established with key incumbent board members prior to succession.

2022-4-1, Ma, Yao, Jonczyk Sédès, Claudia, Georgakakis, Dimitrios