The Impact of Executive Turnover on Entrepreneurial Company's Performance: The Moderating Role CEO's Prior Work Experience in Algeria's Entrepreneurial Business Companies

Yasmine Ouldchikh and Huatao Peng
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Yasmine Ouldchikh: School of Management, Wuhan University of Technology, Wuhan, 430070
Huatao Peng: School of Management, Wuhan University of Technology, Wuhan, 430070

International Journal of Management Science and Business Administration, 2022, vol. 9, issue 1, 32-41

Abstract: In this study, we examine the effect of executive turnover on the performance of entrepreneurial companies. Additionally, we evaluate the moderating impact of the CEO’s prior experiences to prove how founders’ firsthand knowledge reduces the adverse effects of executives’ departure. Our empirical research uses data from a company’s C-level survey, including 209 entrepreneurial companies in Algeria. The empirical findings demonstrate that executive churn lowers firm performance, which may affect longer-term investments in new initiatives. We also demonstrate that the longer the founder CEO’s prior employment history, the stronger the favorable impacts of executive change are. Our research indicates that the founder and CEO’s entrepreneurial spirit, founded on valuable prior practical knowledge, lessen organizational instability. Our results reveal how executives behave should also be considered, even though the firm’s component is crucial for a new entrepreneurial company’s longevity.

Keywords: Executive turnover; CEO; Managerial Experience; Company's performance (search for similar items in EconPapers)
JEL-codes: M00 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:mgs:ijmsba:v:9:y:2022:i:1:p:32-41

DOI: 10.18775/ijmsba.1849-5664-5419.2014.91.1003

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