Session 233

Top Executives and Directors in Organizational Dynamics

Track F

Date: Monday, October 12, 2009

 

Time: 17:15 – 18:30

Common Ground

Room: Meeting Room 16


Co-Facilitator:
Mason A Carpenter, University of Wisconsin-Madison
Saptarshi Purkayastha, Indian Institute of Management-Calcutta

Title: A Multilevel Conceptualisation of Conflict in Board Level Strategic Decision-Making

Authors

  • Paul Jackson, University of Manchester
  • Thomas Kirchmaier, University of Manchester
  • Judita Ilikeviciute, University of Manchester
  • Agnes Michalik, University of Manchester
  • Julia Nordmann, University of Manchester

Abstract: Research on understanding factors contributing to board effectiveness is inconclusive and contradictory, and this paper argues that the reason for this is that prior work has ignored processes at the micro level. We propose a multilevel theoretical framework for strategic decision-making, and present a preliminary study using a microworld simulation of boards. Based on three experimental groups, we examine 178 conflict episodes and show a relationship between specific conflict management modes and the effectiveness of the group. Our findings establish that micro-level behavioural styles do affect board performance, and contribute to scholarly debates on board effectiveness and on the microfoundations of strategy

Title: An Empirical Investigation of Executive Job Attainment and Retention

Authors

  • Aaron Hill, Oklahoma State University
  • Jason Ridge, University of Arkansas
  • Margaret White, Oklahoma State University

Abstract: This study seeks to expand upon our knowledge of executive selection and retention by investigating the role of three types of status—supervisor, unit and organizational. While research on both selection and retention has been plentiful, our knowledge of these important organizational processes is limited because we have yet to investigate the impact of the status quotient of the executive experiences and prior relationships. Because status differences are a practical reality that affects the assessment of an individual by seemingly objective third-parties, understanding the role that status plays in executive selection and retention should add to our knowledge about these processes.

Title: False Signals: The Effectiveness of Board Prestige as Signals of IPO Firm Quality

Authors

  • Michael Holmes, Florida State University
  • Hermann Ndofor, Indiana University - Indianapolis
  • Joseph Coombs, Virginia Commonwealth University

Abstract: For firms seeking financing through an IPO, prestigious boards of directors have been recommended as an effective signal of the firm’s resources and capabilities. Prestigious boards, it is argued, avoid associations with lower quality firms as such it might injure their reputations. Despite the consistent use board prestige as signals of firm quality, no research to date has attempted to verify its effectiveness. Using a population of biotechnology IPOs between 1980 through 2004, this paper investigates whether prestigious board structures are indeed effective signals of firm quality. Our results do not find any evidence board prestige is related to post IPO market value. Furthermore, some attributes of board prestige have a negative relationship with post IPO market value for IPO firms with higher uncertainty.

Title: New CEO Outsiderness, Strategic Change and Performance: The Role of TMT, Board and CEOs’ Networks

Authors

  • Marko Coh, London School of Economics

Abstract: Extant literature has shown that new CEOs appointed from the outside will tend to institute more changes, yet these changes will likely be detrimental to performance. I suggest that this is a result of unsuccessful resolution of CEO’s “action imperative paradox”, the tension between the need for swift action and the lack of knowledge of the organization. I explore what factors affect resolution of this paradox. I theorize that these factors include composition of top management team with respect to industry tenure and service under the previous CEO; experience and prestige of firm directors; and experience of individuals in the CEO’s personal network. I then hypothesize the direction of the relationship between these factors, the new CEO outsiderness, and the performance implications of strategic change.

Title: Succession Context and New CFO Origin: A Role-Specific Perspective on Managerial Succession

Authors

  • Volker Büttner, WHU - Otto Beisheim School of Management
  • Kevin Zander, WHU - Otto Beisheim School of Management
  • Utz Schaeffer, WHU - Otto Beisheim School of Management

Abstract: Highlighting the importance of a role-specific perspective in upper-echelons-based managerial succession research, we argue that the relatively high transferability of practical CFO skills across firms and industries may reduce impediments to select successors from outside the firm. Our theory and evidence from a sample of 123 CFO changes suggest that the selection of an outsider CFO is more likely in situations of poor firm performance, in firms with major blockholders, after the dismissal of the predecessor, and when no parallel CEO change occurred. Results on the firm performance consequences generally support the decision to nominate outsiders in these contexts. However, in specific situations with extremely poor pre-succession performance, our findings indicate that hurdles to improving performance may exist for the selected outside successors.

Title: The Effect of Industry Origins and Experience of Top Management Teams on Firm Growth

Authors

  • Rajshree Agarwal, University of Maryland
  • Charles Williams, Bocconi University
  • Pao-Lien Chen, National Tsing Hua University

Abstract: Recent research has focused on the importance of managerial cognition, and resonates with extant literature on the effect of executive succession and top management team turnover on firm performance. In this study, we dwell deeper into the subject by examining the impact of industry origin of new TMT members on firm growth, and the moderating effect on this relationship of existing TMT members experience in the focal industry. We test our hypotheses in the context of the US cellular phone service providers industry from 1983 to 1999. We find that first time TMT members that have experience outside the focal industry have a positive influence on the firm’s performance, while the reverse is true for first time TMT members with experience within the focal industry. However, within industry experience of existing TMT members positively moderates this relationship.

All Sessions in Track F...

Sun: 10:00 – 11:30
Session 260: Writing Workshop for Doctoral Students and Junior Faculty
Sun: 13:00 – 14:30
Session 261: Shareholder Primacy and Corporate Policy
Sun: 15:00 – 16:30
Session 262: The Role of Government in M&A Activity
Sun: 16:30 – 17:30
Session 310: Corporate Strategy & Governance, IG Meeting
Mon: 12:45 – 14:00
Session 198: Perspectives on CEO Succession
Session 228: Business Groups, Alliances, and Contracts
Mon: 15:45 – 17:00
Session 229: Alliances and Corporate Strategy
Session 230: Ownership Determinants and Consequences
Mon: 17:15 – 18:30
Session 194: CEOs and Top Management Teams
Session 197: Diversity, Identity, and Corporate Governance
Session 233: Top Executives and Directors in Organizational Dynamics
Tue: 10:00 – 11:15
Session 199: Executive Compensation
Session 200: Social Psychological Perspectives of CEOs
Tue: 11:30 – 12:45
Session 195: Competitive Dynamics of Business Groups
Session 234: Constraints and Catalysts on Corporate Growth
Tue: 14:30 – 15:45
Session 226: Relatedness, Dominant Logics, and Other Diversification Logics
Session 231: Institutions and Agents
Wed: 10:00 – 11:15
Session 227: Corporate Strategy & Diversification
Session 232: Stakeholders in the Corporate Governance Equation
Wed: 11:30 – 12:45
Session 196: Behavioral Perspectives on Boards of Directors
Session 225: Acquisitions and Corporate Strategy


Strategic Management Society

Washington DC