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A study on top managers from a resource-based perspective
Abstract
Purpose
This study aims to apply the resource-based and upper-echelons perspectives to integrate concepts of strategic decision-making (i.e. speed and quality) and transformational leadership behavior (i.e. inspirational motivation, intellectual stimulation, individualized consideration and idealized influence) to examine how these resources are influenced by the characteristics of top managers (i.e. demographic backgrounds and entrepreneurial orientation) to affect firm performance.
Design/methodology/approach
Using evidence from a sample of 111 top managers from different firms in Taiwan, this research examined the relationships among the selected variables using two versions of the designed questionnaire: one for the leader, and the other for the followers. Confirmatory factor analysis and structural equation modeling were used to analyze the data.
Findings
The findings reveal the following: the entrepreneurial orientation of top managers does affect their leadership style, which affects firm performance; if top managers display traits of transformational leadership, then firm performance will be higher, likely because transformational leaders tend to make high-quality decisions and strategic decision-making speed was influenced by the experience of top managers and the inspirational motivation provided by transformational leadership.
Originality/value
This study makes three specific contributions: improving the limitations of demographics-based top-management studies by investigating both demographics and psychological characteristics; advancing research on the relationships between entrepreneurial orientation and performance by integrating transformational leadership behaviors and examining the proposed research model from a resource-based perspective.
... However, based on the momentum literature on TL, most of the past studies showed several limitations. First, the RBV theory was applied to enrich the TL literature, which remains a theoretically underdeveloped topic in the areas of CE (Alrowwad et al., 2020;Pan et al., 2021) and AC (Hsu & Chang, 2021), particularly in the healthcare institution (Ferreras Méndez et al., 2018;Głód, 2018). This research has responded to the repeated calls for research to integrate TL and AC literature (Alrowwad et al., 2020). ...
Absorptive capacity is widely acknowledged as a critical driver of innovation, business development, and self-renewal through the acquisition, transformation, assimilation, and application of knowledge. Despite the importance of the relationship between transformational leadership and corporate entrepreneurship, there exists a research gap due to the insufficient exploration of the mediating impact of absorptive capacity. This study endeavors to fill the existing research gap by delving into the interplay between transformational leadership and corporate entrepreneurship, taking absorptive capacity into consideration as a mediating factor. Surveys were collected from 154 middle managers representing a broad range of healthcare institutions in the United Arab Emirates. The study utilized a two-step structural equation modelling approach and provided empirical evidence to support the hypothesis that absorptive capacity mediates the relationship between transformational leadership and corporate entrepreneurship. These findings contribute to the resource-based view theory by demonstrating the effective role of transformational leadership in promoting corporate entrepreneurship through the development of absorptive capacity.
... Therefore, this method of measuring emerging TMT diversity dimensions and firm performance allows the collection of current information and constitutes the paper's first contribution. Second, the study supports the hypothesis that, based on TMT demographics, companies will have a greater or lower propensity for further expansion (Hsu and Chang, 2021). The upper echelons theory was an appropriate conceptual framework for analyzing this strategic issue (Truant et al., 2021). ...
The paper sheds light on impactful diversity dimensions of upper echelons across German companies and their impact on the appointment of Chief Digitalization/Information Officer during the turbulent years of internet of things and digitalization in the second decade of the twenty-first century. The study consists of a literature review on diversity across senior management of German firms in a digital era characterized by global business technological digital disruption. The paper discusses how the emerging phenomena of diversity across top management affect firm performance during the period of incremental innovation and turbulent digital trasnformation of multinational firms. The novelty of the study is nested in the fact that it provides evidence from top management teams' diversity from the advanced markets, such as Germany, where digitalization is one of the priorities of the German government but also of the German business in order to drive long-term firms’ performance and firms’ sustainability. The motivation behind conducting the research on top management teams' diversity across top German companies in the digital era is the fact that the crucial importance of senior management skills, competencies and knowledge are key factors for firm performance and prosperity. Moreover, in Germany, many of the most successful firms have appointed executive positions in their top management in order to manage the rapid shift towards more digitalized business and higher firm performance in a volatile global business environment. Study results show that top management team diversity positively affects the appointment of Chief Digitalization/Information Officer. Also, the paper results show that firms with incumbent Chief Digital Officers in their top management team tend to be more intact with the digital era than firms that have not appointed any Chief Digitalization Officer.
... In this study, it was decided to interview to the Global Director of Product Development and Commercialization (GDPDC) of the organization because of his degree of involvement in the strategic process (Rotundo & Hernández, 2014) and its ability to significantly impact the performance of the organization (Barney & Arikan, 2001). It has been pointed out that the vision of the company's director plays a fundamental role in the allocation, acquisition and management of resources (Garbuio et al., 2011), their behavior also has a direct influence on the company's strategic actions (Hsu & Chang, 2021). In this sense, the interviewee in this research is the Deputy Director, who has held a variety of positions in the organization, consequently, he can be considered an "elite" participant, a term that refers to those people with a certain position or status within the organization (Liu, 2018). ...
Knowledge-Intensive Firms are a relevant research and practice field because there is much interest in factors promoting their competitiveness. Scholarly literature has noted that organizational culture is a resource is related to the achievement of competitive advantages. Nevertheless, organizational culture at Knowledge-Intensive Firms, has been scarcely analyzed regarding how it is configured and what effects it has. To explain how organizational culture at HarvestPlus, as a Knowledge-Intensive Firm, becomes a distinctive competency, a qualitative study case study design was developed. The results indicate that the predominant culture is adhocratic, it has evolved according to the different HarvestPlus phases and is a sustainable distinctive competence due to it is valuable, difficult to imitate and therefore unique. This research will be useful for scholars and practitioners of this type of organization to understand the usefulness of coordinating and integrating the organizational culture, to leadership behaviors, human resources practices and strategic alliances management, to create strategic resources, as HarvestPlus has done.
... (Afshan and Motwani, 2021;Khan et al., 2019). As a further objective of SCA, all resources like customer sensitivity, process integration, network integration, virtual integration must be reconfigured quickly enough to deal with changes and uncertainties (Hsu and Chang, 2021). An organization's ability to respond quickly while also being flexible is a major aspect of agility in the modern business environment (Karada g, 2018;Sriyanalugsana and Suwantararangsri, 2020). ...
Purpose
This study aims to examine the effect of supply chain agility (SCA) on operational performance (OP) measurements of steel manufacturing firms. It also investigates the role of cost efficiencies concerning enhance OPs.
Design/methodology/approach
The study is based on an experimental research design by collecting data from responses 398 responses of key officials of India’s steel manufacturing firms. Analyses are carried to explore this modern concept with the help of Smart-partial least square (PLS) version 3.3.2 with confirmatory factor analysis and PLS structural equational modelling.
Findings
SCA factor (SCAF) directly has influenced the firm’s OP. It also represents cost efficiencies that have partial mediation between the SCAF and OP. The impact of cost efficiencies on OPs is strongly significant as compared to the impact of SCAF on cost efficiencies.
Practical implications
Management teams in the manufacturing industry should stress the role of SCA as a comprehensive concept in responding to market needs in a volatile environment. SCA reflects one of its winning strategies in today’s dynamic and competitive world. Managers must thoroughly know the ramifications of agility to develop a mechanism for determining the procedures and identifying inequality in SC operation.
Originality/value
This study speaks explicitly about the linkage between SCAF, OP, CE. It is an addition to the existing theories of RBV. Enhancements in OP measurements, specifically performance and flexibility, will lead to better firm performance. study conceptualizing the complementing effects of SCA (IS capability) and OPs and second cost efficiencies play positive partial mediating effect in between the link. The achievement of SC agile is especially a critical approach to Boost customer satisfaction and differentiate market position.
... Out of these approaches and processes, the conceptualization of the study's framework is linked to the idea of creativity, which seeks to improve and arise a concept to turn things in an adoptive way (Prasad & Junni, 2016;Zhu & Bao, 2017). The IB incorporates the stages of development and execution of the above models in order to reformulate or turn the roles and delegated tasks into even more manageable and adaptable forms (Dwivedi et al., 2020;Hsu & Chang, 2021). ...
This study considers the mediating role of top management teams’ (TMTs) behavioral integration in exploring the relationship between the strategic decision-making process (SDMP; procedural rationality and constructive political behavior) and sustainable decision performance (decision quality and decision satisfaction). Survey data totaling 580 from the TMTs of the science and technology enterprises from first-tier cities in China were analyzed through structural equation modeling. The results indicate a positive influence of procedural rationality and constructive political behavior on sustainable decision quality and satisfaction. Behavioral integration appeared to mediate the nexus between the sustainable decision-making process and strategic decision performance. By categorizing the SDMP into two dimensions, a complete and explicit concept of the SDMP is reached, which permits practitioners to aim investments of a critical resource in realizing the full potential of decision performance in the sustainable decision performance.
Abundant extant literature emphasizes the impact of board members attributes’ influence on environmental information disclosure. Considering the voluntary nature of environmental information disclosure, executives have strong managerial discretion when they make such decisions, so this article focuses on top managers’ influence on environmental information disclosure. We hypothesize that top managers’ educational background and age will affect companies’ environmental decision. The hypotheses are verified with the data from Chinese listed manufacturing companies. As the results show, a Master of Business Administration (MBA) educational background and average age of top managers positively affect environmental information disclosure, while the impact of legal educational background is negative. The company’s environmental performance plays a U-shaped moderating effect on the relationship between MBA educational background and environmental information disclosure.
Purpose
Iceland, along with the other Nordic countries, is seen as an international frontrunner in gender equality and equal sharing of responsibility for paid and unpaid work is part of the official ideology. Nevertheless, the number of women in leadership positions remains low. The purpose of this study is to analyse the practices that (re)produce power imbalances between women and men in business leadership both at the macro and the micro levels. This is done by using two theoretical explanations: gendered organizational practices and the interplay of organizations and family life.
Design/methodology/approach
The mixed methods are applied by analysing 51, semi-structured interviews with female and male business leaders and survey data from CEOs and executives from the 250 largest companies in Iceland.
Findings
The analyses reveal gender differences and asymmetries in work life as well as within the family. Men have longer working hours than women, higher salaries and more job-related travelling. Women carry the dual burden of work and family to a higher degree than do men. By questioning and attempting to resist the organizational culture women risk further disadvantage. The situation of male and female leaders is therefore incomparable. This is a paradox and does not fit with the idea of the Nordic gender equality of a dual breadwinner society.
Originality/value
It is shown that lack of gender diversity in business leadership is based on gendered organizational practices as well as on power relations within families. These two aspects are mutually reinforcing and the originality of the study is to explore the interplay between them. The authors conclude that despite being the country at the forefront of gender equality in the world, neither organizational practices nor family relations recognize the different life experiences of women and men in Iceland. This is expressed in organizational practices and different access to time and support, which may hinder gaining gender equality in top leadership.
Top management team international experience and strategic decision-making Abstract Purpose: This study explores the influence of top management team international experience on international strategic decision-making rationality and, subsequently, its effect on decision effectiveness (decision performance). Design/methodology/approach: This analysis is based on survey data of small-medium sized international Pakistani firms operating in the IT industry.
Findings: Results show that top management team international experience is positively related to international strategic decision-making rationality and this latter partially mediates the international experience-decision effectiveness relationship.
Research limitations: The study is based on data collected from a single industry and focuses on an international decision that occurred within a time-frame of previous 4 years.
Practical implications: Findings suggest that international firms, when composing their top management teams, should favor the inclusion of internationally experienced managers.
Originality/value: The study of the influence of international experience on the decision-making process in general and decision-making rationality in particular has been largely neglected in extant literature. This paper highlights one way through which the international experience of the top management team as a whole relates to the effectiveness of international decisions. The paper also advances emergent managerial cognition literature focusing on the top management team and not individual decision makers.
Strategic decision-making processes influence firm-level outcomes. Using the theory of upper echelons, this study investigates how diversity in directors’ skills, knowledge, and industry experience influence board decision-making processes that may impact overall strategic decision-making processes. Such diversity has been commonly accepted to be a ‘double-edged sword’—enhancing comprehensiveness but hindering the speed of decision-making. On the contrary, we used an existing large survey database to show that directors’ diverse educational background, functional background, and industry experience (job-related diversity) have a positive effect on comprehensiveness as well as the speed of board decision-making. In addition, our results indicate that board processes (directors’ use of their knowledge and skills) play an important role by transmitting the positive effects of diversity. The study is in a tradition of exploring how boards may influence firms’ strategic decision-making processes. Our findings provide additional arguments for adding job-related diversity to boards of directors.
Drawing upon resource-based view and social cognitive theory, this work develops a model that validates the formation of team decision quality and team performance. The model is empirically tested with data obtained from IT professionals across MIS work teams from Taiwan’s banking and insurance industry. The statistical results reveal that team performance is indirectly related to collective efficacy and participatory sense making via the full mediation of team decision quality, while collective efficacy and participatory sense making are directly related to knowledge internalization and resource adequacy. At the same time, the effect of participatory sense making on collective decision quality is negatively moderated by team hypercompetition. Finally, managerial implications and limitations based on the empirical findings are provided.
The role of agglomeration economies in firm performance has been extensively studied. Existing studies, however, almost invariably focus on firm, industry or city characteristics to examine the performance-enhancing effects of agglomeration while overlooking the attributes of the top executives involved in shaping corporate practices. In this study, we change that focus by empirically examining the moderating role of two particular top manager characteristics (age and educational level) on the agglomeration economies–firm performance relationship. Using a top manager-firm matched panel data set, we find that top manager age rather than educational level helps firms to realize the potential benefits of agglomeration. This paper contributes to the agglomeration literature by stating the importance of individual top managers.
Although the effect of transformational leadership on project success is empirically supported, less is known about the mechanisms that explain this effect. To address this issue, we propose the mediating role of team-building as a possible explanation of the relationship between transformational leadership and project success. Based on a field survey of 200 development project managers in the Ethiopian Non-Governmental Organization (NGO) sector, the results of our study indicate that team-building partially mediates the effect of transformational leadership on project success. We discuss the theoretical and practical implications of these findings.
How does returnee managers’ international leadership experience influence emerging economy firms’ internationalization? The internationalization process model suggests that international experience plays a central role enabling firms’ internationalization moves. We propose that emerging economy firms can accelerate their development of international experience—and hence their international commitments—by grafting returnees with international leadership experience. We hypothesize that such international leadership experience has a positive effect on firm internationalization, and that this effect is strengthened by central-state ownership and private ownership, but weakened by local-state ownership and foreign ownership. Using 8-year (2001-2008) event-historical data from 164 Chinese electronic manufacturing firms, we found empirical support to our theoretical arguments. Specifically, returnee managers’ international leadership experience is positively associated with emerging economy firms’ likelihood of conducting foreign direct investment, while for other forms of international experience no positive effect can be detected. Our analysis of moderation by firms’ ownership type finds that this positive association is strengthened by central-state and private ownerships, but weakened by local-state and foreign ownership.
Some emerging-market firms have recently achieved substantial growth in developed markets despite having had little prior experience in these markets. What explains the performance of these firms? Building on the organizational learning literature, the authors argue that indirect learning (i.e., learning from the experience of others) plays a crucial role in explaining this phenomenon. Specifically, they propose that emerging-market firms that grow in developed markets overcome their lack of direct experience in such markets by learning indirectly through their leaders, competitors, and interfirm networks. The authors test their thesis by comparing the international growth in developed markets of a sample of emerging-market firms (116 Indian firms) with a sample of developed-market firms (160 U.K. firms). The results support the authors' thesis about the importance of indirect learning in explaining the international growth of emerging-market (relative to developed-market) firms in developed markets. The authors discuss the implications of these findings for policy makers in the areas of higher education, competition policy, and international trade as well as for managers in the areas of middle-management recruitment, competitor analysis and tracking, and managing interfirm networks.
In this article, we provide guidance for substantive researchers on the use of structural equation modeling in practice for theory testing and development. We present a comprehensive, two-step modeling approach that employs a series of nested models and sequential chi-square difference tests. We discuss the comparative advantages of this approach over a one-step approach. Considerations in specification, assessment of fit, and respecification of measurement models using confirmatory factor analysis are reviewed. As background to the two-step approach, the distinction between exploratory and confirmatory analysis, the distinction between complementary approaches for theory testing versus predictive application, and some developments in estimation methods also are discussed.
This study advances research on entrepreneurial orientation and social capital by examining how the configuration of a founding team's intra- and extraindustry net- work ties shapes the relationship between entrepreneurial orientation and new ven- ture performance. Using an original data set of 90 new ventures in the emerging open source software industry, we found that the combination of high network centrality and extensive bridging ties strengthened the focal link. Among firms with few bridging ties, centrality weakened the relationship between entrepreneurial orientation and performance. Overall, these findings contribute to a better understanding of when network centrality represents an asset or a liability for entrepreneurial firms. Although a firm's entrepreneurial processes may facilitate the pursuit of new entry opportunities that enhance its performance, adopting a strong entrepreneurial orientation is increasingly consid- ered necessary but insufficient for wealth creation by new ventures (Covin & Slevin, 1989; Ireland, Hitt, & Sirmon, 2003; Lumpkin & Dess, 1996). A better understanding of the conditions under which an entrepreneurial orientation enhances firm performance may thus require a contingency perspective that emphasizes the importance of fit among a firm's strategic posture and other con- structs of interest (Lumpkin & Dess, 1996). Whereas much work has focused on the moderating role of environmental and organizational factors, surpris- ingly few studies have examined how a firm's em- beddedness in interfirm networks influences the wealth creation potential of its entrepreneurial ori- entation (Simsek, Lubatkin, & Floyd, 2003). The limited empirical evidence that exists suggests that although networks may facilitate the performance of entrepreneurial firms, not all ties do so equally (Peng & Luo, 2000). Thus, identifying conditions under which particular relationships enhance or
Relationships between leaders' motivation and their use of charismatic, transactional, and / or transformational leadership were examined in this study. One hundred eighty-six leaders and 759 direct reports from a variety of organizations were sampled. Leaders were administered the Motivation Sources Inventory (MSI) while followers reported leaders' full range leadership behaviors using the Multifactor Leadership Questionnaire (MLQ-rater version). Leaders were also administered the self-rating version of the Multi-factor Leadership Questionnaire (MLQ-rater version). The Motivation Sources Inventory subscales subsequently significantly correlated with leader self-reports of inspirational motivation, idealized influence (behavior) and individualized consideration (range, r = .10 to .29), as well as with raters' perceptions of inspirational motivation, idealized influence (behavior) and individualized consideration (range, r = .18 to .19). The Motivation Sources Inventory subscales significantly correlated with leaders' self-reports of charisma, transactional and laissez-faire leadership (range, r = .12 to .28), with rater-reports of the same variables (range, r = .16 to .29).
Purpose – The aim of this paper is to explore the relationship between leadership style, top management teams' (TMTs') behavioral integration, and strategic decision-making speed. It reveals how leadership impacts on team progress and strategic decision-making speed.
Design/methodology/approach – The sample was collected from more than ten provinces/cities in China. Factor analysis and structural equation model (SEM) were used to conduct the data.
Findings – The empirical study found that leadership style has a direct positive impact on the speed of strategic decision making, and an indirect positive impact on the speed of strategic decision making through the team behavior integration. The results of SEM show both leadership style and team behavior integration have a significant impact on strategic decision-making speed. It demonstrates that transformational leadership and transactional leadership have both direct and indirect impact on the speed of strategic decisions. Moreover, transformational leadership has a greater impact than transactional leadership on team behavior integration and strategic decision-making speed.
Originality/value – The study enriches the empirical test on the relationship between leadership, team and decision speed, therefore helping us further understand how to improve the speed of strategic decision-making.
Entrepreneurial orientation (EO) is one of the most widely accepted firm-level constructs in the literature. The present study provides a comprehensive qualitative review and evaluation of the empirical EO literature. It finds that EO research has made considerable strides in recent years and is accelerating and broadening, although notable biases and inconsistencies in variable choice and model specification remain. The article sheds light on the popularity of Miller’s unidimensional conceptualization of EO, as well as the rise in multidimensional explorations of the phenomenon. It concludes with a discussion of the implications of the study’s findings for EO-related research and practice.
Purpose – To explain and illustrate the innovative full range leadership (FRL) model from Bass and Avolio and to demonstrate how this model can be utilized within organizations to develop transformational leadership. Design/methodology/approach – This paper describes in detail the FRL model and shows how the transformational leadership styles identified within the model are highly correlated with leader performance. Drawing on extensive personal consulting experience, the paper then outlines how the model, and the associated multifactor leadership questionnaire (MLQ), can be used successfully in training/development interventions in organizations. Findings – The FRL model is probably the most research and validated leadership model in use world-wide today. The transformational styles described by the model are highly correlated with leadership success. Transformational leadership can be successfully taught by a development process which utilizes a combination of 360 degree feedback using the MLQ, structured workshops, and one-to-one coaching sessions. Practical implications – This paper offers a very practical leadership path approach to developing transformational leadership competence, drawing on extensive experience of delivering such programmes with large client organizations world-wide. Originality/value – The originality of the FRL model lies in the concept of a “range” of leadership behaviors which all leaders demonstrate. Rather than insisting that one must lead “like this”, the FRL model makes the point that what is required is a change in the balance of leadership behaviours, away from the more transactional and more towards the transformational. The value of the paper lies in the description of a tried and tested methodology for applying the FRL model in an organizational setting.
Emerging and future changes in workforce diversity have caused a need to examine the potential impact of these changes on all areas of the firm. One area of special interest is that of top management team (TMT) diversity. With more diverse TMTs on the horizon, there is potential for both conflict and performance gains as a result of increased diversity at the highest levels of organizations. This paper examines diversity in top management teams and the potential impact of TMT diversity upon firm performance. Issues surrounding TMTs, upper echelon theory, and team heterogeneity are examined and propositions are offered as potential avenues for empirical research. Managerial implications and future research directions are also discussed.
Examines the relationship between four key post-purchase constructs: perceived performance, satisfaction, perceived value, and repurchase intentions, in a causal path framework in an empirical study of business-to-business professional services. Attempts to disaggregate performance into its component multiple dimensions, and assess the individual impact of each on post-purchase evaluation processes. Shows that the effect of perceived value on repurchase intentions is completely mediated through satisfaction. Confirms six performance dimensions, each having a significant impact on both value and satisfaction and adds new insight to our understanding of the respective roles of perceived value, satisfaction and post-purchase intentions.
Using a sample of some 300 small independent businesses, drawn from Central London, the paper examines how entrepreneurial behaviour affects business performance. It is argued that small businesses motivated by a desire to grow in terms of sales and/or employees and to survive in
a dynamic and competitive environment need to be innovative. However, to what extent they will
innovate successfully depends on their capacity to plan ahead, their capacity to innovate and their
willingness to take risk. It is shown that entrepreneurial businesses are characterised by these competencies that allow them to innovate and thus develop and grow successfully. Not surprisingly,
not all small businesses are equipped with these three competencies owing to their diverse array of
strengths and weaknesses arising from the diversity in the managerial motives and aspirations of
entrepreneurship. These results highlight the importance of the capacity to innovate and the capacity to plan ahead as strong predictors of small businesses’ performance.
We examined how employee perceptions of relational identification with the supervisor and self-efficacy mediate the relationship between transformational leadership and supervisor-rated performance. Performance is used here to refer to the individual's ability to be creative, innovative, inspiring, and take on challenging tasks to achieve organizational goals for the greater good. Using a sample of 426 employees and their 75 immediate supervisors from a large automobile dealership, hierarchical linear modelling results revealed that relational identification with the supervisor mediated the relationship between transformational leadership and self-efficacy, which was then positively related to employee performance. Implications for future research, theory, and practice are discussed.
Research has called for organizations to be more flexible, adaptive, entrepreneurial, and innovative in meeting the changing demands of today's environment. Appropriate leadership to effect such change is required; however, there has been little empirical analysis of the theoretical relationships among the key components that make up such change strategy, including transformational leadership, organizational culture, and organizational innovation. This study examines these linkages in terms of their relationships with climate for organizational innovation in Australian private sector organizations. Structural equation modeling based on responses to a survey of 1,158 managers explores the relationship between transformational leadership and climate for organizational innovation and the extent to which a competitive, performance-oriented organizational culture mediates this relationship. Strategies for building innovative organizations are discussed.
Purpose
The purpose of this paper is to examine the relationship between entrepreneurial orientation (EO) and intrapreneurial intentions among knowledge workers in the Iranian R&D sector using transformational leadership (TL) as a moderator and to also investigate the extent of the knowledge workers’ intrapreneurial intentions.
Design/methodology/approach
The research was tested as a cross-sectional survey of knowledge workers involved in the R&D centers in Iran under the Society of the Centers for Research. The sampling method in this study was based on simple random sampling. Finally, 380 valid questionnaires were collected from 48 R&D centers of different industries.
Findings
The findings of this study reveal that except for the “need for achievement (NFA),” other variables such as “innovativeness,” “proactiveness,” “risk taking,” and “networking” had a significant and positive relationship toward “intrapreneurial intention.” Moreover, it was found that “TL” had a moderating role in the relations between innovativeness, proactiveness, and risk taking with intrapreneurial intention; however, TL did not have a moderating role in the relations between NFA and networking with intrapreneurial intention.
Research limitations/implications
Reliance on cross-sectional questionnaires instead of an experimental design imposes caution about the relationships between the predictors and intrapreneurial intention.
Originality/value
This paper is one of the few studies on the EO at the individual level with new dimensions on the intrapreneurial intention, which examined moderating role of TL at this relationship, which took place in Iranian R&D sector.
The statistical tests used in the analysis of structural equation models with unobservable variables and measurement error are examined. A drawback of the commonly applied chi square test, in addition to the known problems related to sample size and power, is that it may indicate an increasing correspondence between the hypothesized model and the observed data as both the measurement properties and the relationship between constructs decline. Further, and contrary to common assertion, the risk of making a Type II error can be substantial even when the sample size is large. Moreover, the present testing methods are unable to assess a model's explanatory power. To overcome these problems, the authors develop and apply a testing system based on measures of shared variance within the structural model, measurement model, and overall model.
Purpose
The purpose of this paper is to explore the relationship between top management team (TMT) internal social capital and strategic decision-making speed, and further explore role of TMT behavioral integration in their relationship. It reveals how TMT internal social capital impacts strategic decision-making speed.
Design/methodology/approach
On the basis of the social capital theory and upper echelons theory, at first, a model about TMT internal social capital and strategic decision-making speed is proposed by exploratory case study. Then, the data obtained via questionnaire from 67 TMTs by software SPSS 19.0 and AMOS 17.0 are analyzed, and the theoretical hypotheses as mentioned above are verified.
Findings
The empirical study found that different dimensions of TMT internal social capital have significant positive impact on TMT behavioral integrity; TMT behavioral integrity has significant positive impact on strategic decision-making speed; and TMT behavioral integrity as an intermediary variable played a brokering role in the relationship between TMT internal social capital and strategic decision-making speed.
Originality/value
The study enriches the empirical test on the relationship between TMT internal social capital and decision speed, thereby helping the authors further understand how to improve the speed of strategic decision making in TMT.
This paper explores whether top management teams’ (TMTs) knowledge and experience are significant predictors of a firm’s strategic decisions and organization outcomes. The existing research throws little light on how firms with limited resources embedded in TMTs, particularly in emerging markets, innovate and achieve success in foreign countries. We focus on the impact of TMTs’ functional background heterogeneity and international experience on innovation and internationalization, as well as examine the relationship between innovation, internationalization and performance. The proposed relationships are empirically investigated in a sample of Taiwanese-listed companies operating in the electronics industry. The results demonstrate a positive association between a TMT’s functional background heterogeneity and a firm’s innovation. Moreover, a TMT’s international experience relates positively to a firm’s innovation and internationalization, therefore firms with a higher level of innovation achieve a higher level of internationalization.
The primary purpose of this article is to clarify the nature of the entrepreneurial orientation (EO) construct and to propose a contingency framework for investigating the relationship between EO and firm performance. We first explore and refine the dimensions of EO and discuss the usefulness of viewing a firm's EO as a multidimensional construct. Then, drawing on examples from the EO-related contingencies literature, we suggest alternative models (moderating effects, mediating effects, independent effects, interaction effects) for testing the EO-performance relationship.
Purpose
– The purpose of this study is to empirically investigate impact of transformational leadership on team performance and the effects of support for innovation and psychological empowerment in this association. Over the past many decades, teams have become an increasingly popular way of organizing and coordinating work. This trend creates new challenges for leaders, as they are expected to motivate individual employees and to improve team performance simultaneously.
Design/methodology/approach
– This study proposes a conceptual framework for understanding motivation and support extended to individual employees which would influence team performance. The conceptual framework includes psychological empowerment and support for innovation as mediating variables in the effect of transformational leadership on team performance. The study also validates the proposed conceptual framework using a second-order confirmatory factor analysis technique, namely, partial least squares-structural equations modeling, with the data collected from 182 followers from 10 service organizations in the UAE.
Findings
– The findings suggest that transformational leadership has significant positive impact on team performance and, on the contrary, transactional leadership has significant negative effect on team performance. Two dimensions of psychological empowerment such as meaning and self-determination have partial mediation effect in the relationship between transformational leadership and team performance.
Originality/value
– This study contributes to the research that identifies team mechanisms influenced by transformational leadership that can affect team success and performance, particularly in the context of UAE-based organizations. Managerial implications and future research areas are further discussed.
We manipulated transformational and transactional leadership styles and compared them in individual and group task conditions to determine whether they had different impacts on individualists and collectivists performing a brainstorming task. Results showed that collectivists with a transformational leader generated more ideas, but individualists generated more ideas with a transactional leader. Group performance was generally higher than that of individuals working alone. However, contrary to expectations, collectivists generated more ideas that required fundamental organizational changes when working alone.
To better understand the relationship between entrepreneurial orientation and performance, this paper conducted a major review of published work on the entrepreneurial process with a focus on small businesses. Following the review, it became evident that even though the extant literature indicated that both entrepreneurial orientation and transformational leadership influenced firm performance, there was limited literature examining how these two important organisational variables related to each other, and how they interacted to influence firm performance within the context of small businesses. Therefore, the purpose of this paper is to evaluate the extant literature on entrepreneurial orientation, transformational leadership and firm performance and then build a logical framework depicting the interrelationships between transformational leadership, entrepreneurial orientation and organisational effectiveness within the context of small businesses. Specifically, we advance a conceptual research framework, which explicates some pathways through which leader behaviours influence the firm entrepreneurial orientation and overall firm effectiveness. We conclude the paper by outlining a future research agenda for effectively leading entrepreneurial organisations within the small business sector.
Extant research has shown that entrepreneurial orientation (EO) is positively associated with firm performance, but several contingencies affect the strength of this relationship. This article uses insights from the resource-based view and upper echelons perspective to introduce top management’s transformational leadership behaviors as moderators in the EO-performance relationship. The theoretically derived model is tested using survey data obtained from 790 small-and medium-sized firms in six countries. Findings indicate that, regardless of national setting, four transformational behaviors—articulating a vision, providing an appropriate model, having high performance expectations, and showing supportive leader behavior—positively affect the relationship between EO and firm performance. Further, the performance consequences of EO are greater when top management adheres to a configuration characterized by the highest possible levels of transformational behaviors. Implications and directions for future research are discussed.
We hypothesized that teamworking quality, defined as an inter-team collaborative process, is the mediator that links the efficacy of three antecedents—relational attitudes (relational norms and senior management commitment), collaborative practices (team integration and joint working procedures), and teams' joint capability (the project team's overall competence and experience)—in improving project performance (efficiency, effectiveness, perceived satisfaction, perceived success). Using a sample of 113 capital projects, we applied partial least squares structural equation modeling to test our hypotheses. The results confirm that the three antecedents indirectly influence project performance through teamworking quality. There is no empirical evidence that these antecedents directly influence project performance: relational attitudes, teams' joint capability, and collaboration practices do not automatically lead to a successful collaboration without day-to-day managerial intervention in teamworking processes. We also found that the parties' expectations regarding continuing relationships, as a consequence of good project performance, are directly affected by relational attitudes.
This paper explores the executive origins of firms' competitive moves by focusing on top management team characteristics, specifically on team heterogeneity, rather than on the more often studied environmental and organizational determinants of such behaviors. Arguing that competitive actions and responses represent different decision situations, we develop propositions about how heterogeneity may enhance some competitive behaviors but impair others. With a large sample of actions and responses of 32 U.S. airlines over eight years, we find results that largely conform to our propositions. The top management teams that were diverse, in terms of functional backgrounds, education, and company tenure, exhibited a relatively great propensity for action, and both their actions and responses were of substantial magnitude. Heterogeneous teams, by contrast, were slower in their actions and responses and less likely than homogeneous teams to respond to competitors' initiatives. Thus, although team heterogeneity is a double-edged sword, its overall net effect on airline performance, in terms of changes in market share and profits, was positive.
This study analyzes the impact of team transformational leadership on team performance during the new product development (NPD) process and the mediating role of team climate. Data were collected from 184 NPD projects of Chinese high-tech firms. The results show that NPD team transformational leadership is positively related to team performance. In addition, team climate mediates the relationship between most dimensions of NPD team transformational leadership (charisma, inspirational motivation, intellectual stimulation, and individualized consideration) and team performance.
Eighty-seven respondents completed either a graphic rating or a forced ranking questionnaire describing their immediate superior. Five leadership scales were embedded in each questionnaire. Three represented transformational leadership constructs (charismatic leadership, individualized consideration, and intellectual stimulation); two reflected transactional leadership constructs (contingent reward and management-by-exception). Appended to each questionnaire were five additional scales. The items constituting these scales measured two outcomes-satisfaction with the leader and effectiveness of the leader. The remaining scales measured each participant's leadership prototype, the participant's tendency to be lenient in his/her ratings, and a general measure of satisfaction. As expected, the intercorrelations among the factor scores representing the transformational and transactional leadership constructs were reduced substantially by using the forced rankings as compared with the graphic ratings. Also, the magnitude of the relationships among leadership and outcome factor scores was reduced, on average, when using the forced rankings. Prototypicality factor scores were more highly correlated with factor scores reflecting transformational than were factor scores portraying transactional leadership. The tendency of participants to be more or less lenient in their ratings or rankings and their general level of satisfaction were of little or no consequence to the intercorrelations among the leadership and outcome factor scales.
Top management team (TMT) heterogeneity—performance research using demographic indicators has contributed to strategic management by showing that top managers do indeed “matter” to firm outcomes. We argue, however, that limitations inherent in demographics-based TMT studies preclude their use in specifying how top managers influence their firms. This is an elemental problem because questions of how top managers can and should influence their firms are central to strategic management. Demographics-based TMT heterogeneity studies are limited by intrinsic trade-offs, which sacrifice: construct validity for measurement reliability; explanation for prediction; and prescription for description. We suggest “next steps” for improving the usefulness of future TMT studies (i.e., addressing the “how” question) by: (1) incorporating more substantive heterogeneity constructs, such as within-TMT power distributions, psychographic variances, and judgment differences; and (2) integrating qualitative research with the quantitative as a base for developing research questions that are more informed, salient, and interesting. We urge researchers to eschew demographic proxies, and instead direct their efforts toward more difficult, but potentially more rewarding, TMT issues.
How do executive teams make rapid decisions in the high-velocity mi- crocomputer industry? This inductive study of eight microcomputer firms led lo propositions exploring that question. Fast decision makers use more, not less, information than do slow decision makers. The former also develop more, not fewer, alternatives, and use a two-tiered advice process. Conflict resolution and integration among strategic de- cisions and tactical plans are also critical to the pace of decision mak- ing. Finally, fast decisions hased on this pattem of hehaviors lead to superior performance.
This paper elucidates the underlying economics of the resource-based view of competitive advantage and integrates existing perspectives into a parsimonious model of resources and firm performance. The essence of this model is that four conditions underlie sustained competitive advantage, all of which must be met. These include superior resources (heterogeneity within an industry), ex post limits to competition, imperfect resource mobility, and ex ante limits to competition. In the concluding section, applications of the model for both single business strategy and corporate strategy are discussed.
Top management teams make strategic decisions, and the products of their decision making influence organizational performance, However, a subtle paradox is embedded in this relationship. This study focuses on conflict as the crux of this paradox and provides evidence from two different samples of conflict's consistent yet contradictory effects on decision quality, consensus, and affective acceptance.
The article integrates three lines of research with regard to leadership, decision making, and organizational justice. First the theoretical perspective, it is argued that transformational and transactional leaders adopt different approaches to decision making. Transformational leaders appear to prefer a comprehensive style of decision making that uses many input sources and considers many optional pathways. Transactional leaders, by contrast, are more prone to use a more limited information base, and consider fewer alternative routes. The study reported on here concludes that transformational and transactional leaders focus on different aspects of organizational justice. Transformational leaders tend to emphasize the social dimensions of fairness in the workplace. Transactional leaders are oriented toward the structural features of workplace justice. Some practical issues are addressed, such as what should be considered when managers are selected for specific assignments with leadership requirements, and issues pertaining to changing leadership styles.
It has been argued that transformational leaders increase group effectiveness by empowering followers to perform their job independently from the leader, highlight the importance of cooperation in performing collective tasks, and realign followers’ values to create a more cohesive group. A study was conducted to examine whether transformational leadership would be positively related to followers’perceptions of empowerment, group cohesiveness, and effectiveness. Forty-seven groups from four Korean firms participated in this study. Results of partial least squares analysis indicated that transformational leadership was positively related to empowerment, group cohesiveness, and group effectiveness. Empowerment was positively related to collective-efficacy, which in turn was positively related to group members’ perceived group effectiveness. Implications for research and practice are discussed.
Purpose
The purpose of this paper is to show that participants read vignettes in which managers were assigned different roles. The vignettes depicted managers with two leadership styles (transformational/transactional) and two decision‐making approaches (comprehensive/restrictive). The managers were then rated on patterns of organizational justice (social/ structural). Leadership and decision‐making styles affected different forms of justice.
Design/methodology/approach
Participants rated performance‐evaluation vignettes depicting leadership style, decision‐making approach, and organizational justice patterns on the part of hypothetical managers/leaders.
Findings
Managers portrayed as transformational leaders were rated high on social justice, whereas leaders rated as transactional were high on structural justice. Managers portrayed as restricted in their decision‐making approach were rated lower on social justice compared with managers who used a more comprehensive decision style. Justice ratings were significantly influenced by leadership style and decision
Practical implications
It is suggested that an increased awareness regarding organizational justice is imperative for all decision and leadership styles, and that social justice can occur in brief but powerful encounters that can be executed by any manager or leader.
Originality/value
If organizations, managers, and leaders attend to justice issues, they will foster healthier and more productive workplace environments that extend beyond immediate performance indicators (e.g. budget, quarterly profits, sales and revenue). A focus on organizational justice will create long‐term performance cultures (by fostering employee development, extending genuine regard for employee contributions and wellbeing, and leveraging employee commitment), and lead companies to sustainability.
Purpose
This study aims to: identify organizational and environmental factors affecting strategic decision‐making speed; examine the relationship between those factors and innovation performance; and clarify the relationship between strategic decision‐making speed and innovation performance.
Design/methodology/approach
A survey was conducted on 73 large‐scale firms operating in the manufacturing industry in Turkey, in May 2006 and December 2006.
Findings
The research findings related to the linkage between participation and strategic decision‐making speed indicate that extensive participation accelerates the pace of decision making.
Research limitations/implications
This survey was conducted on CEOs and top managers of large‐scale manufacturing firms operating in Turkey. Cultural differences may become evident from those findings. Also, results might be different if only small and medium‐size firms, or firms in different industries were used.
Originality/value
This survey is one of the first to examine the strategic decision speed and innovation performance relationship, revealing the positive effect of strategic decision speed on innovation performance. It is the first one to be conducted in an Eastern country like Turkey, filling the gap in the literature.
This research examined the effects of three strategic process variables—strategic decision-making participativeness, strategy formation mode, and strategic learning from failure—on the entrepreneurial orientation (EO)–firm sales growth rate relationship. Results based on a sample of 110 manufacturing firms indicated a positive effect of EO on sales growth rate. Moreover, the relationship between EO and sales growth rate was more positive among firms that employ autocratic decision making and that exhibit an emergent strategy formation process. Perceptions of proficiency at learning from strategic mistakes differentially affected the growth rates of firms at different ends of the EO continuum, but in manners inconsistent with the hypothesized relationship.
Several approaches have been used to explore environmental dynamism as a contingent predictor of the relationship between rational-comprehensive strategic decision-making and firm-level performance. At the decision level of analysis, however, small sample sizes, low statistical power, and statistical dependence have plagued the research. Through the use of a simulated decision-making environment and multilevel analysis, this study examined 400 decisions from 54 executive teams. Consistent with much of the existing firm-level research, the results indicated that environmental dynamism may moderate the relationship between rational-comprehensive decision making and decision quality. Surprisingly, the form of the relationship differed from much of the firm-level research. Copyright © 2003 John Wiley & Sons, Ltd.
We examined the extent to which cognitive ability, Conscientiousness, and Openness to Experience predict decision-making performance prior to and after unforeseen changes in the task context. Seventy-three undergraduates made decisions on a series of 75 problems during a 3-hour computerized simulation. Unbeknownst to participants, the rules used in determining correct decisions changed after problems 25 and 50. Effects of the individual differences on decision-making performance became significantly stronger after the changes. Only cognitive ability explained variance in prechange performance. Individuals with higher cognitive ability made better decisions. After the change, the cognitive ability effect increased and the effects of Conscientiousness and Openness became statistically significant. As expected, those with high Openness made better decisions. Unexpectedly, those with low Conscientiousness made better decisions. Subsequent analyses revealed that this surprising effect for Conscientiousness was due to the traits reflecting dependability (i.e., order, dutiful-ness, deliberation) rather than volition (i.e., competence, achievement striving, self-discipline).
The interests of the organization and its members need to be aligned. Such is a task for the transformational leader. In contrast to the transactional leader who practises contingent reinforcement of followers, the transformational leader inspires, intellectually stimulates, and is individually considerate of them. Transformational leadership may be directive or participative. Requiring higher moral development, transformational leadership is recognized universally as a concept. Furthermore, contrary to earlier expectations, women leaders tend to be more transformational than their male counterparts. Although a six-factor model of transformational/ transactional leadership best fits a diversity of samples according to confirmatory factor analyses, whether fewer factors are necessary remains an open question. Another important research question that has only been partially answered is why transformational leadership is more effective than transactional leadership in a wide variety of business, military, industrial, hospital, and educational circumstances.
Examines the strategic postures, competitive tactics, and organization structures of small manufacturing firms that are associated with high performance in both hostile and benign environments. Hostile environments have such characteristics as difficult business climates, intense competition, and few opportunities, making such environments difficult for smaller, resource poor firms, and such environments are increasingly common in manufacturing. Two hypotheses suggest that the relationships between the organization structure and strategic posture can be determined by the level of hostility in the environment. Data were collected via surveys sent to single-industry, independently owned firms in western Pennsylvania, of which 161 responses were analyzed from among those in business for at least five years. Findings indicate that: (1) small firms with organic structures perform best in hostile environments, while small firms with mechanistic structures perform best in more benign environments; and (2) entrepreneurial firms perform better in hostile environments, while small conservative firms perform best in more benign environments. (SFL)