External management succession, human capital, and firm performance: an integrative analysis

Authors

  • Elizabeth E. Bailey,

    1. Department of Business and Public Policy, 3000 Steinberg Hall-Dietrich Hall, The Wharton School, University of Pennsylvania, Philadelphia, PA 19104-6372, USA
    Search for more papers by this author
  • Constance E. Helfat

    Corresponding author
    1. Tuck School of Business, 100 Tuck Hall, Dartmouth College, Hanover, NH 03755, USA
    • Tuck School of Business, 100 Tuck Hall, Dartmouth College, Hanover, NH 03755, USA
    Search for more papers by this author

Abstract

Economic analysis of human capital leads to a somewhat different question than that addressed by other management research on external succession: do differences between external successors in the transferability of their human capital affect firm performance, and if so, how? By comparing external successors that have within-industry and related-industry skills, we find that successors with less transferable (related-industry) skills have greater variance of firm performance. Our analysis provides an example of the benefits of integrating economic concepts with empirical research in competitive strategy, on a topic of central concern in the traditional strategic management literature, namely, top executives. Copyright © 2003 John Wiley & Sons, Ltd.

Ancillary