The effects of executive turnover on top management team's environmental scanning behavior after an environmental change

This study explores how the scope of managerial environmental scanning changes after an environmental shift. Using the context of deregulation in airline industry, I examined both within- and across-sector scanning embodied in the presidents' letters in the annual reports between 1973 and 1986. The results indicate that: 1) top management teams (TMTs) who experienced large turnover in membership tended to have broader scope of environmental scanning, both within and across different sectors; 2) TMT demographic heterogeneity positively moderated such linkage between executive turnover and environmental scanning; and 3) output-orientation in top team members' functional background had a positive main effect on the scope of environmental scanning. The results of this study offer a new insight on the effects of executive turnover and the subsequent changes in TMT composition on environmental scanning.