Events

Prof. Ju-Yeon Lee
John and Connie Stafford Professor in Business
Associate Professor of Marketing
Ivy College of Business
Iowa State University

ABSTRACT

Firms in business-to-government (B2G) marketplaces often invite former government officials to join their boards of directors, in search of their critical knowledge and access. However, the actual impacts of these revolving door directors are unclear for marketing outcomes. By analyzing multisource, secondary panel data of 1,677 publicly traded U.S. firms in the B2G market between 2005 and 2021, the authors find that revolving door directors significantly improve three dimensions of customer relationship performance: customer acquisition, customer retention, and cross-selling performance. The beneficial effects of revolving door directors are contingent on demand volatility and the competitive-bidding preferences of the government customers the firm serves. That is, revolving door directors are more effective for improving customer relationship performance when firms face higher demand volatility from customers but less effective if customers prefer competitive-bidding processes. The customer relationship performance also mediates the relationship between revolving door directors and financial outcomes (contracting performance). These results provide unique contributions to marketing theories and implications for practitioners.