Executive succession and competitive advantage in U.S. hospitals: simulating a randomized control trial

UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
Ryan L. Oglesby (Creator)
The University of North Carolina at Greensboro (UNCG )
Web Site: http://library.uncg.edu/
Eileen Kohlenberg

Abstract: Research linking executive succession and competitive advantage has produced inconsistent findings. Definitive empirical evidence is not available to reconcile how executive leadership succession influences competitive advantage and more specifically whether organizational insiders or outsiders perform better. Two significant concerns exist about the methods used to explore the executive succession-organizational performance phenomenon. First, improved study designs are needed allowing for more robust causal inferences to be made about succession's competitive impact. Second, disagreements about competitive advantage's measurement have contributed to inconsistent results. This study suggests design improvements for executive succession-organizational performance studies with an empirical example using a sample of U.S. hospitals. Propensity score matching was used to simulate a randomized control trial with executive succession as the intervention. Stochastic frontier estimation was used to measure organizations' competitive performances before and after executive succession occurred. The results provided empirical evidence from a simulated random sample indicating that change in leadership and specifically outside succession led to increased competitive capabilities. In general, executive leadership changes led to increased competitive capabilities in this study and outsiders were able to close the performance gap faster in the sampled hospitals. Insiders performed no better than the control group creating a relative reduction in gains to the frontier as compared to outsiders.

Additional Information

Language: English
Date: 2012
Competitive advantage, Executive leadership, Executive succession, Propensity score matching, Stochastic frontier analysis, Transformational leadership
Hospitals $z United States $x Administration
Executive succession $z United States
Hospitals $x Economic aspects $z United States
Competition $z United States

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