Perceptions of Hospital CEOs about the Effects of CEO Turnover

Empirical evidence is scarce on chief executive officer (CEO) turnover in U.S. hospitals, with potentially serious implications for many of these organizations. This study, based on a nationwide survey of CEOs at non-federal general surgical and medical community hospitals conducted in the spring of 2004, reports the perceptions of hospital CEOs regarding the circumstances and impact of CEO turnover on U.S. hospitals. In the opinion of the respondents, the impact includes competitors taking advantage of turnover by luring employees and physicians away from the target hospital, significantly increasing the likelihood of other senior executives leaving the hospital, and many of the important strategic activities being delayed or cancelled altogether. Interestingly, the perceptions of CEOs regarding the effects of turnover do not seem to differ regardless of voluntary or involuntary circumstances of turnover. However, there is a notable bias in emphasizing the perceived negative implications of respondents' own departures and allegedly positive effects of their predecessors' departures.