by
Xiwei Yi, Rice University
Friday, October 23, 2015 | 2:00pm - 3:30pm | Room 329, HSBC Business School Building
Abstract
While prior studies have identified a number of factors that lead to the early dismissal of newly appointed CEOs, little is known about what newly appointed CEOs could do to manage their leadership transition process and alleviate early dismissal rate. In this study, I identified two conditions that increase the newly appointed CEO’s early dismissal rate: (1) when the predecessor CEO is retained as the board chair without a departure time, and (2) when there is a negative stock market reaction to the appointment of the new CEO. In addition, I argue different social influence tactics could be used by newly appointed CEOs to deal with the predecessor CEO and the shareholders. Specifically, I propose that the new CEO’s use of ingratiation, defined as a pattern of submissive behavior that serves to enhance one’s interpersonal attractiveness, could help build a rewarding relationship with the predecessor CEO and hence weaken the relationship between the retention of the predecessor CEO and the new CEO’s early dismissal rate. In addition, I argue that the new CEO’s use of self-promotion, defined as attempts to create an appearance of competence, could weaken the relationship between a negative stock market reaction and the new CEO’s early dismissal rate by building a competent image in the eyes of the shareholders.
