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Power, Performance, and Succession in the Large Corporation
Michael Patrick Allen and Sharon K. Panian
Administrative Science Quarterly
Vol. 27, No. 4 (Dec., 1982), pp. 538-547
Published by: Sage Publications, Inc. on behalf of the Johnson Graduate School of Management, Cornell University
Stable URL: http://www.jstor.org/stable/2392529
Page Count: 10
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This research examines the effects of managerial power and corporate performance on managerial tenure and longevity and the probability of managerial succession in 242 large industrial corporations between 1971 and 1980. The power of a chief executive officer is defined in terms of his relationship to any family represented on the board of directors that controls a significant block of the voting stock in the corporation. Managerial power was directly related to both managerial tenure and longevity, even controlling for the effects of corporate performance. Similarly, managerial power was inversely related to the probability of managerial succession during periods of poor corporate performance. These relationships were contingent, however, on the extent of stock ownership by the controlling family. Finally, although the proportion of internal directors had no effect on either managerial tenure or longevity, it did have an effect, along with corporate performance, on the degree of internal recruitment for a successor to the chief executive officer.
Administrative Science Quarterly © 1982 Johnson Graduate School of Management, Cornell University