Information asymmetries in the hiring process and the risk of new leader dismissal: insights from English premier league soccer organizations

Desai, Malay N.; Lockett, Andrew; Paton, David

Abstract

Why are some new leaders dismissed quicker than others? Adopting agency theory logic we examine how different succession contexts shape boards’ information asymmetries about a potential candidate’s competencies in the hiring process, which influences the propensity of making poor hiring decisions and hence the risk of new leader dismissal. Employing duration analysis on a sample of 164 newly appointed leaders in the English premier league (1996 –2014), we find that the risk of new leader dismissal is: (i) greater when the predecessor leader’s exit was initiated by them rather than by the board; (ii) greater when following a longer tenured predecessor; and (iii) lower for outside successions as compared to inside successions.

Citation

Desai, M. N., Lockett, A., & Paton, D. (2018). Information asymmetries in the hiring process and the risk of new leader dismissal: insights from English premier league soccer organizations. British Journal of Management, 29(1), 26-42. https://doi.org/10.1111/1467-8551.12210

• Journal Article Type: Article
• Acceptance Date: Nov 16, 2016
• Online Publication Date: Jan 5, 2017
• Publication Date: Jan 17, 2018
• Deposit Date: Dec 1, 2016
• Publicly Available Date: Jan 6, 2019
• Journal: British Journal of Management
• Print ISSN: 1045-3172
• Electronic ISSN: 1467-8551
• Publisher: Wiley
• Peer Reviewed: Peer Reviewed
• Volume: 29
• Issue: 1
• Pages: 26-42
• DOI: https://doi.org/10.1111/1467-8551.12210
• Keywords: New leader dismissal, Leader succession, Agency theory, Asymmetric information; New leader dismissal, leader succession, agency theory, asymmetric information
• Public URL: https://nottingham-repository.worktribe.com/output/904999
• Publisher URL: http://onlinelibrary.wiley.com/doi/10.1111/1467-8551.12210/abstract
• Additional Information: This is the peer reviewed version of the following article: Desai, M.N., Lockett, A. and Paton, D. (2017), Information Asymmetries in the Hiring Process and the Risk of New Leader Dismissal: Insights from English Premier League Soccer Organizations. Brit J Manage., which has been published in final form at doi:10.1111/1467-8551.12210. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving.
• Contract Date: Dec 1, 2016