JOURNAL OF LEADERSHIP, ACCOUNTABILITY AND ETHICS
The Effect of Leadership Turnover on an Intangible Resource: A Virtual Experiment
Author(s): Janice A. Black, Richard L. Oliver, Philip G. Benson, Brent H. Kinghorn
Citation: Janice A. Black, Richard L. Oliver, Philip G. Benson, Brent H. Kinghorn, (2013) "The Effect of Leadership Turnover on an Intangible Resource: A Virtual Experiment," Journal of Leadership, Accountability and Ethics, Vol. 10, Iss. 3, pp. 44 - 64
Article Type: Research paper
Publisher: North American Business Press
Abstract:
Entrepreneurs may start a firm and then leave it. What impact does this leadership turnover have on the
firm’s intangible resources? Creating an agent-based simulation of a start-up, we examine changing
leaders and the development of the intangible resource, the context-for-learning (CFL). Changing leaders
negatively affects firm CFL but firms with a high level of CFL recover quicker. Firms that have a new
leader with an effective leadership profile also recover quicker. Multiple leadership changes result in a
developmental path for CFL that bounces around and ends below the developmental path with the
original entrepreneur. For firms with low levels of CFL and an entrepreneur with an ineffective
leadership profile, leadership turnover with another entrepreneur with a similar ineffective profile
resulted in improved firm CFL levels. Leaders and groups matter. The relative difference between the
last leader and the current leader also matters in developing socially constructed resources.