Mandated to Change, Pressured to Survive: How Newly Appointed CEOs Use Resonance to Manage Strategic Change–Early Survival Dilemma

Abstract

Newly appointed CEOs often enter office with a mandate to initiate strategic change, yet such change disrupts established routines and interests, frequently provoking resistance from organizational stakeholders. This creates a fundamental leadership transition dilemma: the strategic change new CEOs are expected to undertake may also threaten their early survival. We argue that strategic change increases the likelihood of CEO early dismissal because boards, facing uncertainty about a new CEO's competence, may interpret negative stakeholder reactions as signals of weak leadership or poor fit. Drawing on the strategic communication literature, we propose that new CEOs can mitigate this tension by building resonance, defined as alignment between their communication and stakeholders' emotional concerns and cognitive frames. In particular, charismatic visions and expressions of optimism generate emotional resonance by reducing anxiety and uncertainty and strengthening affective commitment to change; linguistic simplicity and language concreteness create cognitive resonance by making change initiatives clearer and more credible. Through these communication tactics, new CEOs can build stakeholder support for strategic change even before they have established a firm power base. Using a sample of CEO successions in S&P 1500 firms from 2002 to 2015, we find support for these predictions.