Frequent CEO Turnover and Firm Performance: The Resilience Effect of Workforce Diversity

Kim, Youngsang; Jeong, Sophia Soyoung; Yiu, Daphne W.; Moon, Jinhee

doi:10.1007/s10551-020-04534-0

Cited by 54 publications

(29 citation statements)

References 109 publications

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“…However, a closer look at the findings suggests that this is not the case. For example, employees' ability to innovate during a crisis (Senbeto and Hon, 2020) might be affected by an organization's diverse workforce (Kim et al , 2020). Similarly, an organizational culture geared toward anticipating—and later coping with—adversity could be positively influenced by a manager who considers this to be important (Halkos et al , 2018; Labaka et al , 2016).…”

Section: Discussionmentioning

confidence: 99%

“…Another organizational factor that can help with coping is workforce diversity. As scholars have suggested, a diverse workforce can have complementary skills and behaviors that ultimately make it easier to handle challenges (Kim et al , 2020). However, to contribute to resilience, organizations must ensure they are able to understand and manage their various members (Yacob, 2018).…”

Section: The Building Blocks Of Organizational Resiliencementioning

confidence: 99%

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The building blocks of organizational resilience: a review of the empirical literature

Vakilzadeh

Haase

2020

CRR

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PurposeResilience is critical for organizations in today's volatile business environment, yet some will survive (and even thrive) despite adversity, while others will perish. Why do some organizations handle adversity better than others? The past literature confirms the importance of specific resources, capabilities and structures in dealing with adversity. However, empirical research on organizational resilience remains highly diverse, and the available results have not yet been presented succinctly.Design/methodology/approachA literature review of empirical research on organizational resilience was conducted to summarize the diverse findings of 69 studies, focusing on the factors that lead to resilience.FindingsSeveral building blocks affect how organizations successfully anticipate, cope with and adapt to adversity. Anticipation entails environmental scanning, resilience plans, specific leadership behavior and resources. Coping necessitates particular leadership qualities, a certain organizational culture and innovation. Adaptation requires an organization to learn from adversity and initiate change processes, which influences its ability to anticipate adversity in the long run.Originality/valueBy exclusively analyzing empirical research on organizational resilience, this study summarizes and assembles the results into building blocks for organizational resilience. The findings elaborate on the composition of a concept that is known for its complexity.

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Section: Discussionmentioning

confidence: 99%

Section: The Building Blocks Of Organizational Resiliencementioning

confidence: 99%

The building blocks of organizational resilience: a review of the empirical literature

Vakilzadeh

Haase

2020

CRR

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“…Besides, special assets accumulated by enterprises, such as their value propositions and relationship networks, are also impacted when top executive turnover occurs (Kim et al, 2020). It is difficult for new executives to master the skills of using certain assets; they need to learn in a multi-dimensional way, which requires more time (Rowe et al, 2005).…”

Section: Top Executive Turnover and Randd Investmentmentioning

confidence: 99%

Impact of top executive turnover on firms’ R&D investment: evidence from China

et al. 2020

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Though top executive turnover's economic consequence is highlighted in earlier studies, its link with innovation behaviour has remained relatively underexplored. This study aims to fill this gap through investigating whether, and if so, how, top executive turnover event influences firms' R&D investment. Based on a sample of 2,810 A-share listed companies in China for the period 2008-2016, our results suggest that top executive turnover is negatively related to enterprises' R&D investment. This is mainly because top executive turnover increases the departure rate of R&D personnel, which worsens enterprises' internal R&D environment. The findings also indicate that the negative effect of top executive turnover on R&D investment is accentuated for family enterprises and non-stateowned corporations. Our results have implications for the literature on top executive turnover and enterprises' innovation behaviour and can inform practice, particularly with respect to the selection of top management team members.

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“…CEO turnover is one of the most researched topics in the finance and management fields and constitutes a “trendy topic” among scholars and practitioners (see, e.g. Chen et al , 2019; Dalton et al , 2007; Dasgupta et al , 2018; Hermalin and Weisbach, 2003; Jenter and Kanaan, 2015; Jenter and Lewellen, 2021; Kim et al , 2020). Most empirical evidence comes from the study of public firms.…”

Section: Introductionmentioning

confidence: 99%

CEO turnover in public and private organizations: analysis of the relevance of different performance horizons

Lafuente

García‐Cestona

2021

JEFAS

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PurposeThis paper investigates how past performance changes, prior CEO replacements and changes in the chairperson impact CEO turnover in public and large private businesses.Design/methodology/approachWe analyze 1,679 CEO replacements documented in a sample of 1,493 Spanish public and private firms during 1998–2004 by computing dynamic binary choice models that control for endogeneity in CEO turnovers.FindingsThe results reveal that different performance horizons (short- and long-term) explain the dissimilar rate of CEO turnover between public and private firms. Private firms exercise monitoring patience and path dependency characterizes the evaluation of CEOs, while public companies' short-termism leads to higher CEO turnover rates as a reaction to poor short-term economic results, and alternative controls—ownership and changes in the chairperson—improve the monitoring of management.Originality/valueOur results show the importance of controlling for path dependency to examine more accurately top executives' performance. The findings confirm that exposure to market controls affects the functioning of internal controls in evaluating CEOs and shows a short-term performance horizon that could be behind the recent moves of public firms going private or restraining shareholders' power.

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Frequent CEO Turnover and Firm Performance: The Resilience Effect of Workforce Diversity

Cited by 54 publications

References 109 publications

The building blocks of organizational resilience: a review of the empirical literature

The building blocks of organizational resilience: a review of the empirical literature

Impact of top executive turnover on firms’ R&D investment: evidence from China

CEO turnover in public and private organizations: analysis of the relevance of different performance horizons

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