A managerial capital perspective on chief marketing officer succession

Recognizing the importance of the person who occupies the chief marketing officer (CMO) position, we posit that a CMO's managerial capital, as signaled by his or her education, origin, and experience, indicates what a new CMO can bring to the table. We theorize that the value of CMO managerial capital is contingent on organizational demographics (firm age and size) and industry environment (dynamism and growth). Results from multi-source data collected on 303 CMO successions between 1996 and 2009 and an event study approach with corrections for unobserved heterogeneity and endogeneity reveals a positive influence of CMO's education and outsider status on abnormal returns associated with CMO succession and a U-shaped relationship between CMO experience and firm value. In terms of the moderation effects, we find that the value of CMO experience increases as the firm size increases; value of CMO external origin decreases whereas that of CMO experience increases with firm age; value of CMO education increases whereas that of outsider status and experience decreases with industry dynamism; and value of CMO education and experience increases as industry growth increases.