Strategic consequences of executive succession within diversified firms

Article Abstract:

Systematic investigation of leaders and their influence on organizations has been a major area of research interest. In examining the upper echelon-organizational outcome linkage, researchers have come to focus on the issue of executive succession. This focus has been due in large part to an emerging theoretical perspective that managerial differences may explain much of the variance in organizational outcomes. The purpose of this study is to ascertain whether or not top management succession affects subsequent corporate strategy. This article extends previous research efforts by longitudinally examining the linkage between executive succession and the extent of corporate strategic change across a sample of Fortune 1000 diversified firms. The findings confirm that the nature of executive succession has substantial consequences for corporate strategy. Firms have a greater likelihood of experiencing significant changes in strategy when they choose successors from outside the organization; firms that select their key executives by promoting from within are more likely to experience significantly less change in their corporate strategy. The results of this longitudinal investigation of the strategic outcomes of succession have significant implications for those in a position to select successors to the executive ranks. (Reprinted by permission of the publisher.)

Management, Executives, Succession planning (Business)

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Contrasting planning systems in high, medium and low performance companies

Article Abstract:

Discriminant analysis was used to determine if the characteristics of planning systems varies for firms exhibiting high, medium and low levels of financial performance. The findings present an overall pattern of planning in successful firms that paid close attention to current markets, controlled operating costs and was very clear in regard to the actions and results expected. At the same time, these firms kept in close touch with external trends, used supplemental sources of information and applied their capabilities to new opportunities as they developed. High performers also reported a less complex planning process. (Reprinted by permission of the publisher.)

Planning, Business enterprises

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