This article is an attempt to answer whether managerial knowledge specificity determines managerial resource and the outsider CEO’s succession. It predicts the effect of managerial knowledge on the outsider CEO succession in the biopharmaceutical sector. The economic assumption suggests that managerial generic knowledge has more value, so it determines the outsider CEO’s succession. The strategic assumption suggests that managerial specific knowledge determines the outsider CEO’s succession. We test three hypotheses representing, high, moderate and less specific managerial knowledge. Contrary to either of the two assumptions, our findings indicate that managerial industrial knowledge (moderately specific knowledge) appears to be a good predictor of an outsider CEO in biopharmaceutical industry. Thus, we offer an alternative framework. The article discusses implications and some limitations of the study.
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