Promotions, turnover, and performance evaluation: Evidence from the careers of division managers

Cichello, M S and Fee, C E and Hadlock, C J and Sonti, R (2009) Promotions, turnover, and performance evaluation: Evidence from the careers of division managers. Accounting Review, 84 (4). pp. 1119-1143.

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Abstract

We study turnover and promotions of division managers in multidivisional firms. Turnover is negatively related to divisional accounting performance, positively related to industry performance, but not significantly related to firm performance or the performance of other divisions. Consistent with tournament theory, promotions are sig nificantly related to whether one division is performing better than others, but are not significantly related to the magnitude of any performance difference. A simple perform ance metric, divisional ROA, appears more closely related to job allocation decisions than several alternatives. Our evidence is consistent with the hypothesis that account ing information is used by firms when evaluating managerial personnel.

ISB Creators:
ISB CreatorsORCiD
Sonti, RUNSPECIFIED
Item Type: Article
Uncontrolled Keywords: Division managers; Internal labor markets; Performance measurement; Promotions; Turnover
Subjects: Business and Management
Human Resources Management
Depositing User: Ilammaran A
Date Deposited: 03 Nov 2014 20:24
Last Modified: 20 Nov 2014 09:51
URI: http://eprints.exchange.isb.edu/id/eprint/148
Publisher URL: http://dx.doi.org./10.2308/accr.2009.84.4.1119
Publisher OA policy: http://www.sherpa.ac.uk/romeo/issn/0001-4826/
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