The Promotion Paradox: Organizational Mortality and Employee Promotion Chances in Silicon Valley Law Firms, 1946–1996

Phillips, Damon J.

doi:10.1086/320293

Cited by 98 publications

(80 citation statements)

References 36 publications

(50 reference statements)

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“…For example, an organization may learn through turnover and the experiences of new executives (March 1991) even if those executives do not remain in the firm. Although quick executive exits are not the goal of a firm, there may be an individual-organization paradox where events that are beneficial at one level are detrimental at another (Phillips 2001). For example, the transition from atypical position creators to typical position successors may be hazardous to the individual incumbent who is asked to make the transition, but overall the transition may be beneficial to the firm.…”

Section: Discussionmentioning

confidence: 99%

Leaving a Legacy: Position Imprints and Successor Turnover in Young Firms

2007

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W hat accounts for differences in job tenure? Turnover and mobility, by providing differential opportunities for advancement and individual attainment, are key mechanisms for understanding occupational segregation, social stratification, and internal labor markets that have long interested sociologists (Baron and Bielby 1980;Jacobs 1989;Osterman 1987;Reskin 1993). Over decades of inquiry, scholars have elucidated several factors that contribute to job durations, including both individual and structural characteristics (Rosenfeld 1992). While the traditional approach to job mobility highlights the match between individuals and jobs at a moment in time, more recent scholars have incorporated temporal dynamics and suggested that evolutionary patterns at the group level (Sørensen 2000) or across the industrial sector (Haveman and Cohen 1994) influence turnover propensities. This dynamic approach begins to highlight how the past impinges on the present. We expand on these insights and further emphasize the role that local histories play in shaping turnover propensities at the level of individual positions. The microlevel structures created when agents first establish organizational positions are important sources of internal constraint.This article considers how local firm histories influence individual turnover rates in organizations. We argue that position imprints-the legacies left by the first incumbents of particular functional positions-constrain subsequent position holders. We show that the functional experience of the person who creates a position influences the turnover rate of successors who later occupy that position. When the first position holder has an atypical background, all successors experience high turnover rates. Individuals who are both typical with respect to the normative environment and similar to the position imprint have the lowest turnover rates. Surprisingly, we find lower turnover rates among individuals who match the position imprint even if they violate normative expectations. Thus, contrary to institutional theory predictions, we find that local firm histories dominate. In revealing how social structures emerge within firms and affect individual outcomes, our research revisits core topics of bureaucratization and organizational stratification including idiosyncratic jobs, occupational segregation, and differential mobility. In addition, we integrate structuralist and interactionist perspectives on role theory by considering how roles are created. Finally, in demonstrating the effects of position imprints on successor mobility we add a temporal dimension to theories of turnover.

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Section: Discussionmentioning

confidence: 99%

Leaving a Legacy: Position Imprints and Successor Turnover in Young Firms

2007

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“…We test these ideas by examining a sample of 167 high-technology entrepreneurial firms in a single region that have been studied previously , 2001Burton, Sørensen, & Beckman, 2002). Previous studies collected TMT data on these firms and examined important elements of entrepreneurship theory, such as team factors that lead to venture capital financing or initial public offering (Beckman & Burton, 2008;Beckman et al, 2007) and factors that result in different strategic choices (Beckman, 2006).…”

Section: Data and Samplementioning

confidence: 99%

“…While these actions may represent strategic choices in team composition, if the roles available within the team are fixed (e.g., new roles are not added), this may constrain future rewards and opportunities. In short, this may be akin to a promotion paradox (Phillips, 2001), albeit at a different level of analysis, where TMT underqualification provides shortterm opportunities for new hires but perhaps less long-term development of TMT structures. In addition, our results point to the importance of the developmental stage: firms are only able to change the TMT, regardless of the level of misfit, after achieving some developmental milestones.…”

Section: Managerial Implicationsmentioning

confidence: 99%

Misfit and Milestones: Structural Elaboration and Capability Reinforcement in the Evolution of Entrepreneurial Top Management Teams

Ferguson

Cohen

Burton

et al. 2016

AMJ

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We examine how "top management team (TMT) misfit," or discrepancies between the TMT's functional roles and the qualifications of the managers who fill those roles, affects the evolution of TMT composition and structure in a longitudinal study of entrepreneurial ventures. We distinguish two types of misfit-overqualification and underqualificationand study how each is associated with TMT changes. We further consider the moderating effect of firm development. Results reveal that underqualified TMTs hire new managers to reinforce existing capabilities whereas overqualified TMTs elaborate their role structures. However, achieving developmental milestones (i.e., obtaining venture capital funding and staging an initial public offering) is a critical contingency to TMT change: absent these milestones, firms neither hire new managers nor add roles, even when they seemingly need to do so. These findings contribute to knowledge of how TMTs and new ventures evolve by underscoring the importance of simultaneously attending to TMT composition and structure.

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“…While organizational ecologists typically focus on the vital events of corporations (e.g., foundings and disbandings), recent work within the field has begun to explore the connections between corporate demography and worker outcomes such as promotion chances (Phillips 2001), job mobility (Greve 1994;Haveman and Cohen 1994) and wage inequality (Sørensen and Sorenson 2007;Sørensen 2007). Two key aspects of the ecology of economic agglomeration are entrepreneurial activity and organizational diversity.…”

Section: Organizational Ecologymentioning

confidence: 99%

“…Two key aspects of the ecology of economic agglomeration are entrepreneurial activity and organizational diversity. In his study of the ''promotion paradox,'' Phillips (2001) found that lawyers actually had the most opportunity for promotion in small, start-up law firms in Silicon Valley because of the firms' weakened bargaining position. Start-up firms have lower organizational survival chances (i.e., the ''liability of newness'') and therefore offer promotion opportunities in order to attract and retain high-skilled workers.…”

Section: Organizational Ecologymentioning

confidence: 99%

Spatial Agglomeration and Wages in the U.S. Biotechnology Sector

Fullerton

2011

Sociological Spectrum

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Recent studies show that firms and workers benefit from the geographic concentration or spatial agglomeration of employment in a local labor market. While economic geographers have devoted considerable attention to the benefits firms receive from spatial agglomeration, the reasons workers may benefit in the form of higher wages are less clear. I draw from several theoretical perspectives in order to explain the relationship between spatial agglomeration and wages for U.S. biotech workers, including the new economic geography, new structuralism, organizational ecology, and the new economic sociology. Using the 1990 PUMS-L, I employ a hierarchical linear model in order to test hypotheses from these perspectives. The results indicate that biotech workers benefit more from industrial than urban agglomeration, and these benefits are primarily due to the greater degree of organizational diversity in large industry clusters and urban labor markets.

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The Promotion Paradox: Organizational Mortality and Employee Promotion Chances in Silicon Valley Law Firms, 1946–1996

Cited by 98 publications

References 36 publications

Leaving a Legacy: Position Imprints and Successor Turnover in Young Firms

Leaving a Legacy: Position Imprints and Successor Turnover in Young Firms

Misfit and Milestones: Structural Elaboration and Capability Reinforcement in the Evolution of Entrepreneurial Top Management Teams

Spatial Agglomeration and Wages in the U.S. Biotechnology Sector

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