Musk’s Choice for Twitter CEO and the Glass Cliff Debate

Elon Musk has announced that Linda Yaccarino, chief advertising officer of NBCUniversal, will be the new CEO of Twitter (now called X Corp.). According to a Tweet from Musk, Yaccarino will primarily focus on business operations, while Musk will continue to lead product design and new technologies.

As CEO of Twitter, Yaccarino steps into a risky role with a decent probability of failure. She will take the reins of a company that Musk says has lost more than half its value since its $44 billion purchase last November. As for profitability, Musk says the company is breaking even, although its financials are not publicly available. Prior to Musk’s takeover, the company was struggling to turn a profit.

Since Twitter’s future is uncertain and Yaccarino is female, she can be seen as a glass cliff hire. The term “glass cliff” describes a phenomenon where women and minorities are more likely than men to be appointed to leadership positions in times of crisis. Besides Yaccarino, the appointment of Ellen Pao at Reddit, Mary Barra at GM, Carly Fiorina at HP, and Marissa Mayer at Yahoo are often cited as examples of women being promoted to senior management in struggling companies. Despite these prominent examples, recent research has shown that white men are just as likely as women and minorities to be promoted to lead failing businesses. In other words, there may not be a glass cliff phenomenon in business management.

Nonetheless, several studies have found support for the glass cliff idea. One such study analyzed CEO appointments at Fortune 500 companies over 15 years and found that women and people of color were more likely to be appointed CEOs when the organization was struggling. More evidence comes from college basketball in the United States. Minority coaches were more likely than white men to be promoted to coach losing teams.

Despite this evidence supporting the glass cliff, other studies have found no evidence for the phenomenon. Some scholars have even called it “the glass cliff myth”. For example, a study of 233 large companies in Germany and the UK over ten years found no evidence of a glass cliff phenomenon in either country.

To reconcile the disparate results of different studies on the glass cliff, the researchers performed a statistical analysis of all research on this topic, examining 74 independent studies. Their findings, published in 2020 in Psychological Bulletin, found no evidence to support a glass cliff phenomenon in business management or sports. In other words, women and minorities were no more likely than white men to be promoted when these organizations were in crisis.

The researchers found evidence of the glass cliff in the political realm and stronger effects in education and nonprofit organizations. In these fields, women and minorities were more likely than white men to be hired by struggling organizations or governments. Additionally, researchers have found evidence of the glass cliff phenomenon in experimental studies where participants were asked hypothetically about a man’s or woman’s fitness to run a failing business. The researchers concluded: “We find support for the glass cliff, but the effect is weak and not pervasive. Instead, it is limited to certain areas and may depend on a range of factors.

Despite the ongoing debate about the existence of the glass cliff phenomenon, the fact remains that Yaccarino took on a difficult leadership role in a company that suffered significant financial losses. Her position at Twitter is precarious and she has taken the risk of running the organization. This would be true of anyone running the business, regardless of gender.