Panel Paper: Learning on the Job: The Impact of Managerial Experience on Nursing Home Performance

Friday, November 3, 2017
San Francisco (Hyatt Regency Chicago)

*Names in bold indicate Presenter

Seung-Ho An1, Kenneth J. Meier1, Anna A. Amirkhanyan2 and Beth Hawks2, (1)Texas A&M University, (2)American University

In Organizations, March and Olson argue that more experienced managers have problem-solving skills that lead to both better decisions and reduced conflict among employees. Past successes and failures in setting, developing, and implementing various managerial strategies improve managers’ understanding of organizations and may positively affect organizational outcomes. Although managerial longevity can be critical in improving organizational performance, this topic has been understudied, with most public management research using longevity as a control rather than a key variable of interest.

This paper explores the effects of managerial longevity on organizational performance in public, private and nonprofit organizations. Our theoretical framework on the effect of managerial longevity is informed by public administration, business, strategic management and health care literature. We investigate both linear and nonlinear effects of managerial longevity on organizational performance and explore how three key managerial practices – innovative management, participative management, and managing external influences – moderate this relationship. By interacting managerial longevity with these three types of managerial practices, our goal is to identify which managerial practices can potentially work best for an experienced manager.

Government, nonprofit and for-profit nursing homes in the United States serve as a context and provide the data for our analysis. The nursing home industry is characterized by high levels of administrative turnover making it an ideal case for assessing the impact of managerial experience. Reliable performance indicators for these organizations are available from Nursing Home Compare, a federal performance appraisal system. These data are supplemented by a Texas A&M University survey of nursing home administrators’ focusing on managerial strategies.

Our findings suggest that managerial longevity is positively associated with organizational performance. The relationship, however, is more likely to be linear rather than nonlinear; that is, there appear to not be diminishing marginal returns or cases where longevity leads to poor performance. In addition, more experienced managers are better able to manage external organizational environments and share power internally to achieve better organizational outcomes. In contrast, the effect of innovative management style on performance rarely depends upon a manager’s longevity. Taken together, this study sheds lights on the relationship between managerial longevity, managerial practices, and organizational performance in the context of nursing homes across different sectors.