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Who directs strategic change? Director experience, the selection of new CEOs, and change in corporate strategy
Author(s) -
Westphal James D.,
Fredrickson James W.
Publication year - 2001
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.205
Subject(s) - business , selection (genetic algorithm) , accounting , strategic management , upper echelons , corporate governance , marketing , management , economics , finance , computer science , artificial intelligence
We develop a theory of board‐directed strategic change in which directors (1) conceive changes in corporate strategy that reflect the strategies of their own home companies, and (2) select new CEOs who have prior experience with similar strategies to facilitate implementation. The findings show that, while the experience of new CEOs appears to predict corporate strategic change, these effects disappear after accounting for board experience. Thus, our results suggest that executive effects on strategy can mask board effects. Copyright © 2001 John Wiley & Sons, Ltd.