CEO succession: A conceptual model
Abstract
Chief executive succession is a phenomenon which affects many fundamental processes in organizations. The purpose of this dissertation is to examine factors in a conceptual model of CEO succession in order to develop hypotheses to be tested in future research. The proposed model analyzes succession in the context of four hierarchial factors: individual factors, organizational factors, industry factors, and environmental factors. Survey data are collected from 96 chief executive officers and secondary financial data are collected from 233 companies in three industries: banking, computer and petroleum. Results support previous literature in that poor organizational performance leads to succession and larger organizations experience more succession. Additionally, numerous individual factors such as general management experience, number of firms in which a CEO has worked, industry experience, and educational background also relate to succession. Significant differences on several variables were found across industries. In general, a case has been made that the choice of an appropriate successor can address an organization's need to (a) establish a new strategic direction, (b) increase the firm's ability to deal with changes in the environment, or (c) turn around poor performance. The study generated 15 hypotheses to be tested in future research. These hypotheses postulate the relationship between succession and the various factors of the conceptual model as well as posit factors which could predict, effect, or be effected by succession. Suggestions for future research include (1) exploring the entire succession process from start to finish, (2) exploring the reasons for succession, and (3) analyzing succession in light of the changing nature of management.
Degree
Ph.D.
Advisors
King, Purdue University.
Subject Area
Management
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