Category Archives: healthcare

Inside vs. Outside

A Rice University study finds a long-term benefit to promoting CEOs from within vs. hiring an outsider.

There was little difference found at first — both insiders and outsiders tended to make changes once appointed — but “as tenure increases, obvious opportunities for cost cutting and divestment dry up [for outsiders],” says Anthea Zhang, co-author of the study and a management professor at Rice.

“Inside CEOs, because of their deep knowledge and root in the firm, are more likely to initiate and implement strategic changes that can build the firm’s long-term competitive advantage,” she says.