Let's explore with a divided team! The effects of top management team demographic faultlines on technological exploration

2019 ◽  
pp. 1-20
Author(s):  
Mengge Li ◽  
Kun (Carl) Liu
Keyword(s):  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
It Services ◽  
Top Managers ◽  
Diverse Backgrounds ◽  
The Us ◽  
The Status ◽  
Status Difference ◽  
Technological Exploration

Abstract Research on top management team (TMT) diversity suggests that diverse backgrounds improve technological exploration. However, this diversity may also cause demographic faultlines that break a team into subgroups and undermine team performance, and the status difference between CEO and top managers may change inter-subgroup dynamics. We predicted that TMT faultline had an inverted U-shape relationship with technological exploration. Further, we predicted that the effects of TMT faultline were more prominent when the CEO is in the minority subgroup than when the CEO was in the majority subgroup. Using a longitudinal sample from the US IT services industry, the results found that TMT faultline exhibited an inverted U-shape relationship with technological exploration only when the CEO was in the minority subgroup, and such relationship disappeared when the CEO was in the majority subgroup.

Founder Versus Family Owners’ Impact on Pay Dispersion Among Non-CEO Top Managers: Implications for Firm Performance

2014 ◽  
Vol 43 (5) ◽  
pp. 1524-1552 ◽  
Author(s):  
Peter Jaskiewicz ◽  
Joern H. Block ◽  
Danny Miller ◽  
James G. Combs
Keyword(s):  
Firm Performance ◽  
Top Management Team ◽  
Management Team ◽  
Test Theory ◽  
Top Management ◽  
Panel Analysis ◽  
Top Managers ◽  
Pay Dispersion

Emerging evidence suggests that pay dispersion among non-CEO top management team (TMT) members harms firm performance, which raises questions about why firms’ owners tolerate or even support it. Prior research shows that the key distinction between founder and family owners is that in addition to firm performance and growth goals, family owners pursue socioemotional goals. On the basis of this distinction, we develop and test theory linking founders’ and families’ ownership to TMT pay dispersion. Consistent with our theory, a Bayesian panel analysis of Standard & Poor’s 500 firms shows that founder owners use less TMT pay dispersion and that family owners, relative to founder owners, use more, although that declines across generations. We also provide evidence that TMT pay dispersion harms firm performance. Our theory and results are significant because they help to explain why some owners favor compensation practices that cause TMT pay dispersion, despite evidence that this harms firm performance.

Top management team demographic characteristics, business strategy, and firm performance in the US airline industry

2008 ◽  
Vol 46 (2) ◽  
pp. 201-222 ◽  
Author(s):  
Irene Goll ◽  
Nancy Brown Johnson ◽  
Abdul A. Rasheed
Keyword(s):  
Firm Performance ◽  
Airline Industry ◽  
Business Strategy ◽  
Top Management Team ◽  
Demographic Characteristics ◽  
Management Team ◽  
Top Management ◽  
The Us

Power relationships among top managers: Does top management team power distribution matter for organizational performance?

2006 ◽  
Vol 59 (5) ◽  
pp. 622-629 ◽  
Author(s):  
Anne Smith ◽  
Susan M. Houghton ◽  
Jacqueline N. Hood ◽  
Joel A. Ryman
Keyword(s):  
Organizational Performance ◽  
Power Distribution ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Power Relationships ◽  
Top Managers

CEO reputation and top management team compensation

2014 ◽  
Vol 52 (3) ◽  
pp. 540-558 ◽  
Author(s):  
Gregorio Sanchez-Marin ◽  
J. Samuel Baixauli-Soler
Keyword(s):  
Corporate Governance ◽  
Top Management Team ◽  
Listed Companies ◽  
Management Team ◽  
National Commission ◽  
Top Management ◽  
Governance Mechanisms ◽  
Governance System ◽  
Content Type ◽  
Top Managers

Purpose – The purpose of this paper is to clarify the influence of chief executive officer (CEO) reputation on top management team (TMT) compensation, proposing corporate governance characteristics as a moderator of the relationships between the power of top managers to extract rents and the importance of external signals. The study aims to expand the domain of executive compensation literature by including the role of CEO reputation in the context of non-Anglo-Saxon corporate governance systems. Design/methodology/approach – The paper opted for a panel methodology for the period 2004-2009, including 534 observations from Spanish listed companies. Data were obtained from several sources. Compensation and governance information was obtained from the Spanish Stock Exchange National Commission; data regarding CEO reputation were obtained from Spanish Corporate Reputation Monitor, and, finally, financial statement was obtained from the OSIRIS database. Findings – The paper provides empirical insights on the CEO reputation diffusion on TMT compensation, showing different scenarios depending on effectiveness of corporate governance. CEO reputation diffusion on TMT pay is strengthened or weakened by the organizational governance effectiveness. General evidence supports the notion that in countries characterized by an incomplete corporate governance system, boards – and also indirectly the structure of ownership – act as a catalyst for external signs of legitimacy, rather than for the organization's and stakeholders’ interests. Research limitations/implications – Because of the difficulty in pooling information for a long period from three different sources of data, the number of observations is not very large. Therefore, researchers are encouraged to test the proposed propositions further using other context of corporate governance. Practical implications – The paper includes implications for the development of effective governance mechanisms which promote an adequate link between the CEO reputation and the TMT compensation, avoiding rent extractions. Originality/value – The paper contributes to new international evidences regarding relations between top managers’ reputations and compensation. Specifically, it allows reinforcement of the importance of institutional arguments in the understanding of the effectiveness of governance mechanisms in large listed companies.

Strategic Clarity in Banking: Role of Top Management-Team Demography

1993 ◽  
Vol 73 (3_suppl) ◽  
pp. 1187-1201 ◽  
Author(s):  
Karen A Bantel
Keyword(s):  
Top Management Team ◽  
Top Management Teams ◽  
Management Team ◽  
Strategic Decision ◽  
Top Management ◽  
Organizational Size ◽  
Top Managers ◽  
Using Data ◽  
Retail Banks

The relationship between the demographic composition of the top management team and strategic clarity was analyzed using data from a sample of retail banks. The demographic characteristics of education, homogeneity in age and tenure, and heterogeneity in educational major and functional background were analyzed. Controlling for organizational size and firms' performance, banks with a clear strategy are characterized by top management teams that are heterogeneous on education major and functional background. These results suggest support for the benefits of cognitive diversity for top managers engaged in strategic decision making.

Inherent Limitations of Demographic Proxies in Top Management Team Heterogeneity Research

1999 ◽  
Vol 25 (6) ◽  
pp. 935-953 ◽  
Author(s):  
Richard L. Priem ◽  
Douglas W. Lyon ◽  
Gregory G. Dess
Keyword(s):  
Strategic Management ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Team Heterogeneity ◽  
Demographic Indicators ◽  
Top Managers ◽  
Trade Offs ◽  
Research Questions ◽  
Performance Research

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.

scholarly journals Effects of Top Management Team Characteristics on Patent Strategic Change and Firm Performance

2022 ◽  
Vol 12 ◽  
Author(s):  
Yongtao Zhou ◽  
Yi Zhou ◽  
Li Zhang ◽  
Xu Zhao ◽  
Weijing Chen
Keyword(s):  
Firm Performance ◽  
Safety Climate ◽  
Strategic Change ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Core Competitiveness ◽  
Upper Echelons Theory ◽  
Patent Strategy ◽  
Top Managers

Patent strategy is increasingly recognized as a vital contributor in promoting core competitiveness of an enterprise. A top management team (TMT) has been indicated as one of the key factors driving changes in patent strategy. Based on upper echelons theory, this study examines how TMT characteristics, including, team diversity, emotional intelligence, and safety climate, influence enterprise patent strategic change and, hence, the business outcome. The data from 930 top managers in 228 enterprises showed that the changes in patent strategies are significantly influenced by the characteristics of top managers. These aforementioned internal TMT factors have diverse effects on the speed and scope of the enterprise patent strategic change, which in turn affects firm performance in a positive and negative way, respectively.

scholarly journals Teachers in the Top Management Team and Corporate Social Responsibility

2021 ◽  
Vol 13 (24) ◽  
pp. 13795
Author(s):  
Wenyuan Liu ◽  
Ting Ren ◽  
Weishan Tang
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Top Management Team ◽  
Teaching Experience ◽  
Management Team ◽  
Top Management ◽  
Listed Firms ◽  
Top Managers ◽  
Corporate Social ◽  
A Share

Firms are required to consider all stakeholders’ interests and achieve coordinated development of the company, society, and the environment. Teachers are often associated with high moral standards and dedication to others. Top managers in the top management team (TMT) are responsible as corporate executives for corporate governance and outcomes. How top managers’ teaching experience affects corporate social responsibility (CSR) therefore becomes a meaningful question. Based on A-share listed firms in China from 2010 to 2019, we empirically analyze the effects of teachers as top managers on firm CSR performance. According to our sample, 13.75% of A-share listed firms have top managers with teaching experience in the TMT. We find that the occurrence of teachers in the TMT has a positive impact on CSR, especially on sub-indicators like shareholder responsibility; employee responsibility; supplier, customer, and consumer responsibility; and environmental responsibility. Firms with more teachers in the TMT exhibit higher CSR performance. Further results indicate that this effect is significant only when top managers are also directors on the board. We use the propensity score matching method to alleviate the endogeneity problem and obtain robust results.

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