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This study examines how the movement of top managers across organizations (executive migration) over an 18-year period in the semiconductor industry influences strategic change, specifically, entry into new product markets. Results support the argument that executive migration brings managers into the organization with prior exposure to different products and strategies, which in turn is reflected in subsequent product-market entry decisions by the executive's new firm. Results also show that the effects of executive migration are influenced by attributes of the executive and characteristics of the top management team of the focal firm. The effects of executive migration on product-market entry are stronger when the new managers came from the functions of R&D and engineering, when they reported to the chief executive in their former organization, and when they had greater industry experience. Attributes of the focal firm's top management team also appear to moderate the influence of the new executive. Smaller top management teams and teams with shorter tenures demonstrate a stronger relationship between executive migration and strategic change.*
How do organizations make decisions about what businesses to compete in? This question has been a central topic of concern for strategy researchers (Burgelman, 1994; Rumelt, Schendel, and Teece, 1994) as well as a primary issue for organization theorists (Haveman, 1993; Carroll and Hannan, 1995). Changes in the overall set of products and services the organization competes in-its corporate-level strategy (Rumelt, 1974)-represent critical decisions that affect the boundaries of the organization, its competitive posture, and its future performance.
Theoretical and empirical research has shown that decisions to initiate strategic changes are the responsibility of the top managers of the organization (Child, 1972; Hambrick, 1994) and that characteristics of an organization's top management team can play an important role in prompting major changes in strategy (Finkelstein and Hambrick, 1990; Jackson, 1992; Wiersema and Bantel, 1992). According to this research, the skills, knowledge, and background that executives bring to the top management team play a central role in influencing strategic choices. While acknowledging that the top management of the organization plays a critical role in determining the organization's strategy, empirical researchers have paid less attention to the role of individual top managers. Essentially, theorists have focused on the top management team as the unit of analysis, examining...