On October 23, 1996, the day AT&T announced that John Walter, an industry outsider, would be named CEO, the company’s market valuation dropped by $4 billion. In his book Searching for a Corporate Savior, Rakesh Khurana at Harvard Business School noted that this negative market reaction became a self-fulfilling prophecy, causing the board of directors and other top executives to lose confidence in Walter, and leading to his dismissal only nine months after assuming office.
How Companies Use Strategically Timed Announcements to Confuse the Market
A flurry of news can be very distracting.
April 26, 2016