MANAGEMENT TENURE AND EXPLANATIONS FOR SUCCESS AND FAILURE

Several researchers have argued that executives with longer tenure in their companies may become psychologically committed to the status quo and that this commitment may reduce the quality of decision making an d company performance. The study described in this paper extends prior research on Chief Executive Officer (CEO) and top management team (TM T) tenure and on attributions of responsibility for past performance b y assessing the relationship between tenure, company experience and at tribution patterns. The results show that CEO and TMT tenure and compa ny experience are positively associated with self-serving attributions (taking credit for positive outcomes and laying blame on the environm ent for negative outcomes), which are, in turn, associated with lower subsequent financial performance. However, tenure and company experien ce are not directly associated with poor performance to a significant degree. These results suggest that executives with more extensive expe rience in a company tend to identify more strongly with the company an d with current strategy and therefore attribute negative outcomes to e xternal causes. This biased attribution pattern in turn may reduce the effectiveness of decision making, leading to poorer future performanc e.