The differing effects of agent and founder CEOs on the firm's market expansion
Article first published online: 4 AUG 2011
Copyright © 2011 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 33, Issue 1, pages 23–41, January 2012
How to Cite
Souder, D., Simsek, Z. and Johnson, S. G. (2012), The differing effects of agent and founder CEOs on the firm's market expansion. Strat. Mgmt. J., 33: 23–41. doi: 10.1002/smj.944
- Issue published online: 9 NOV 2011
- Article first published online: 4 AUG 2011
- Manuscript Revised: 31 MAY 2011
- Manuscript Received: 9 FEB 2010
- agent CEOs;
- founder CEOs;
- market expansion;
- CEO tenure
This paper builds and tests the thesis that CEO influence evolves differently for founders and agents. We theorize that at the beginning of their tenures, founder CEOs can pursue market expansion more aggressively than agent CEOs, because they take office with the combination of motivation, power, and requisite knowledge that agent CEOs build over time. Subsequently, however, founder CEOs have less access to the administrative infrastructure necessary to sustain a growing firm, making them less able than agent CEOs to continue market expansion mid-tenure and more severely constrained by market complexity. A longitudinal study of cable television operators confirms that the firm's market expansion follows an inverted U-shape for agents and a downward slope for founders, while market complexity reduces market expansion, especially for founders. Copyright © 2011 John Wiley & Sons, Ltd.