CEO Turnover and Openness of Decision-making Processes in the Post-succession Phase: Exploring a Threat-rigidity Perspective

Abstract

This study examines how top leader turnover in the public sector affects organizational strategic decision-making processes in the post-succession phase. Survey responses of managers were combined with a novel database on CEO turnover in the U.S. Federal Government. Drawing on threat-rigidity theory, we hypothesize that as CEO turnover is perceived as a threatening event for both managers and CEOs themselves, organizations as a whole respond by becoming more rigid, centralizing strategic decision-making and restricting the flow of information. This has knock-on effects on the quality of strategic decisions and their implementation, with detrimental effects on the delivery of public services.

Keywords

CEO turnover decision-making process threat-rigidity theory organizational alignment post-succession

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