Steering Towards AI: Examining the Influence of Diverse CEO Experiences on AI Orientation

Despite ongoing interest in the role of CEO backgrounds, the distinct influences of the individual components of CEO career variety on firm strategy remain a critical yet underexplored area. Grounded in the upper echelon theory, our paper bridges this gap by examining how these individual components – functional, industry, and firm background variety – affect firms’ AI orientations. Using fractional logistic models and data from S&P 500 companies from 2015-2021, we discover distinct impacts of each dimension: functional background variety is positively related to AI orientation, while industry and firm background variety are negatively related to it. CEO IT-related education weakens the negative associations. Our study highlights that different types of career variety promote and inhibit AI orientation. It also underscores the importance of CEOs in strategically pursuing radical technological developments like AI.