Will the New CEO Create Change?

Victor1558 (CC BY 2.0)

When a new CEO is appointed, how does his or her newness influence strategic changes? Does prior experience matter? David H. Weng of the City University of Hong Kong and Zhiang (John) Lin of the University of Texas at Dallas published “Beyond CEO Tenure: The Effect of CEO Newness on Strategic Changes” on June 28, 2012 in the Journal of Management (JOM) to answer these questions and more. Click here to access other articles in JOM’s OnlineFirst collection.

An excerpt:

We argue that a new CEO’s experience at a prior firm may influence the new CEO’s perspective, which may further affect his or her tendency toward change in a focal firm. To study this issue, we contend that the strategic distance between a focal firm and a new CEO’s previous firm (the definition will be provided later) may strengthen the relationship between CEO newness and strategic changes. Additionally, whether a focal firm and a new CEO’s previous firm are in the same industry may matter.

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