A Leader's Wake: Organization Member Reactions to CEO Succession

This article examines how the context and content of CEO successions affect the reactions of organization members in Fortune 500 firms. The influence ofpresuccessionfinancial performance, predecessor tenure, the force initiating a change in CEO, and successor origin on postsuccession disruption, management turnover, and company morale was assessed (controlling for both size and age offirm). These consequences of succession, measured in a survey to which 235 human resources executives responded, had not been investigated in previous large-scale empirical studies. The conceptual model and empirical results of this study suggest that understanding how organization members react to leadership changes is intrinsically important for organization scientists, potentially useful in explaining the effects of succession on economic performance outcomes, and valuable for those seeking to cope effectively with the aftermath of leadership transitions.

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