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Article
Publication date: 28 September 2011

Xin Liang and Joseph Picken

The purpose of this paper is to attempt to verify the predicted relationship between the demographic (i.e. tenure, functional background, etc.) difference and cognitive…

Abstract

Purpose

The purpose of this paper is to attempt to verify the predicted relationship between the demographic (i.e. tenure, functional background, etc.) difference and cognitive difference among top managers and examine how such a relationship is affected by the communication among top managers.

Design/methodology/approach

The authors hypothesized that there is a positive relationship between demographic deviation and cognitive deviation of a focal manager on a TMT, and that such a relationship is mediated by the degree of communication that the focal manager has with other team members on the TMT. Using Structural Equation Modeling techniques, these hypotheses were tested based on a sample of 348 top managers that consist of 28 top management teams.

Findings

It was found that the hypothesized relationship between demographic deviation and cognitive deviation of a focal top manager was supported with respect to the tenure of a manager, but not the functional background of a manager. Moreover, it was found that communication frequency of a focal manager with other team members mediated the relationship between the tenure deviation and the cognitive deviation of the focal manager and that tenure deviation negatively influenced communication frequency, which in turn, negatively influenced the cognitive deviation of the manager.

Practical implications

These findings imply that: when constructing a competitive top management, practitioners such as boards of directors of a firm should pay more attention to the tenure diversity of a top management team because tenure diversity influences the cognitive diversity of the team; and communication among members of a management team can reduce the cognitive differences among members. However, communication happens more frequently among managers with similar tenure than among managers with dissimilar tenure. To promote consensus, managers need to watch for the forming of group fault lines along tenure within their teams.

Originality/value

As far as is known, this is the first study that uses relational demography to examine the influence of tenure difference on cognitive difference among members of a top management team and to expose a mediating role played by communication frequency.

Details

Leadership & Organization Development Journal, vol. 32 no. 7
Type: Research Article
ISSN: 0143-7739

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Article
Publication date: 3 August 2015

Xueli Wang, Lin Ma and Yanli Wang

The purpose of this paper is to discuss the influence of different aspects of top management team (TMT) functional background on short-term performance, long-term…

Abstract

Purpose

The purpose of this paper is to discuss the influence of different aspects of top management team (TMT) functional background on short-term performance, long-term performance, innovation performance and oversea performance separately. This research aims to verify whether the social categorization theory and information and decision-making theory are applicable in listed companies of China’s information technology (IT) industry so as to provide key theoretical references for TMT enhancement ad corporate performance improvement.

Design/methodology/approach

This paper takes A-share listed companies in Shanghai Stock Exchange and Shenzhen Stock Exchange as its study subjects, and it chooses the data from 2004 to 2010 in all of the 105 companies in IT industry in terms of the classification of Wind Database. The stepwise multiple regressions were run utilizing the regression program in Statistical Product and Service Solutions (SPSS).

Findings

The research results show that the social categorization theory can better explain TMT’s influence on corporate performance. TMT functional heterogeneity does not contribute to improving corporate performance and shows significant negative influence on short-term performance and innovation performance in particular. Among the three basic functional backgrounds, TMTs dominated by “throughput” backgrounds show significant positive influence on short-term performance, long-term performance, innovation performance and overseas performance, and the influence turns out to be the largest among these three backgrounds. In terms of the three special professional experiences, top executives with overseas backgrounds have significant positive influence on all of short-term, long-term, innovation and overseas performances. Externally hired executives, however, would impede corporate innovation development, while those with government background would increase corporate overseas performance.

Originality/value

This paper analyzes the relationship between TMT functional background and corporate performance in a comprehensive way for the first time and then takes the lead in considering the dynamics and complexity of corporate performance as well as discussing the influence of TMT functional background on four corporate performances. This study not only supports the effect that the social categorization theory has on TMTs but also offers some inspirations on the development of China’s IT companies.

Details

Nankai Business Review International, vol. 6 no. 3
Type: Research Article
ISSN: 2040-8749

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Article
Publication date: 1 March 1987

Robert A. Gordon

Means, medians and SD for available socio‐economic status (SES) black‐white differences are here substituted for those of IQ in a between‐groups model published by the…

Abstract

Means, medians and SD for available socio‐economic status (SES) black‐white differences are here substituted for those of IQ in a between‐groups model published by the author over a decade ago. The goodness of fit of the SES variables used is compared with that for the earlier IQ data. Even when SES variables are relatively successful this can be viewed as additional evidence of the importance of IQ differences to black‐white differences in delinquency.

Details

International Journal of Sociology and Social Policy, vol. 7 no. 3
Type: Research Article
ISSN: 0144-333X

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Article
Publication date: 11 November 2014

Daniel Kipkirong Tarus and Federico Aime

– The purpose of this study is to examine the effect of boards’ demographic diversity on firms’ strategic change and the interaction effect of firm performance.

Abstract

Purpose

The purpose of this study is to examine the effect of boards’ demographic diversity on firms’ strategic change and the interaction effect of firm performance.

Design/methodology/approach

This paper used secondary data derived from publicly listed firms in Kenya during 2002-2010 and analyzed the data using fixed effects regression model to test the effect of board demographic and strategic change, while moderated regression analysis was used to test the moderating effect of firm performance.

Findings

The results partially supported board demographic diversity–strategic change hypothesis. In particular, results indicate that age diversity produces less strategic change, while functional diversity is associated with greater levels of strategic change. The moderated regression results do not support our general logic that high firm performance enhances board demographic diversity–strategic change relationship. In effect, the results reveal that at high level of firm performance, board demographic diversity produces less strategic change.

Originality/value

Despite few studies that have examined board demographic diversity and firm performance, this paper introduces strategic change as an outcome variable. This paper also explores the moderating role of firm performance in board demographic diversity–strategic change relationship, and finally, the study uses Kenyan dataset which in itself is unique because most governance and strategy research uses data from developed countries.

Details

Management Research Review, vol. 37 no. 12
Type: Research Article
ISSN: 2040-8269

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Article
Publication date: 27 November 2019

Chao Chen and Rongxi Luo

With many years’ economic transformation from “Made in China” to “Created in China,” the State Council has set May 10th as annual “China’s Brand Day” from 2017. This…

Abstract

Purpose

With many years’ economic transformation from “Made in China” to “Created in China,” the State Council has set May 10th as annual “China’s Brand Day” from 2017. This action indicates the implementation of brand strategy and the new national policy of promoting China’s brands. The purpose of this paper is to examine the influence of marketing background of top management team (TMT) on trademark and brand output.

Design/methodology/approach

Using the trademark application data of Chinese-listed companies, this paper constructs a multiple linear regression model and uses the OLS method. This research also uses two-stage regression to examine the effect of endogeneity on the results.

Findings

Our results show that the higher the proportion of executives with marketing background in TMT, the more the number of trademark applications. Furthermore, we document that the positive impact of TMT marketing background on the number of trademark applications is more pronounced in non-state-owned enterprises, companies with more patent output and companies whose CEO has marketing background, indicating that when TMT can play a bigger role, companies have better innovation ability and team collaboration is more efficient, the promoting role of TMT marketing background on the number of corporate trademark applications will be stronger.

Originality/value

This research focuses on the world’s largest emerging economy – China, which is different from the existing literature that is mainly based on western developed countries. With China’s economy stepping into a new normal and consumption upgrading, it is important and worthy of a deep discussion about which factors affect the company’s trademark and brand management.

Details

Journal of Contemporary Marketing Science, vol. 2 no. 3
Type: Research Article
ISSN: 2516-7480

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Article
Publication date: 25 June 2018

Wein-Hong Chen, Min-Ping Kang and Bella Butler

Penrose’s argument regarding the managerial constraint on continual expansion over two consecutive periods is termed the “Penrose effect,” a relatively less investigated…

Abstract

Purpose

Penrose’s argument regarding the managerial constraint on continual expansion over two consecutive periods is termed the “Penrose effect,” a relatively less investigated premise in Penrose’s growth theory. The purpose of this paper is to empirically re-examine the Penrose effect from the perspective of upper echelons theory and investigated how top management team (TMT) composition influences the continual growth of a firm.

Design/methodology/approach

This study empirically tested the hypotheses based on a sample of listed manufacturing firms operating in Taiwan, a newly industrialized economy in the Asia–Pacific region. Moderated hierarchical regression analyses were applied to test hypotheses.

Findings

The empirical results suggest that low TMT diversity (in terms of educational, functional and team tenure diversity) is likely to engender a situation in which the Penrose effect might occur. Additionally, the results indicate that the proportion of functional executives plays a significant role in influencing the growth trend over two consecutive periods and may soften the impact of the Penrose effect.

Practical implications

This paper suggests that appropriate structuring of TMTs and appropriate management of their members’ backgrounds and team tenure diversity can help firms overcome the Penrose effect and grow continually. Furthermore, the proportion of functional executives in a TMT is influential.

Originality/value

This paper uniquely contributes to the theoretical and empirical development of Penrose’s growth theory, upper echelons theory and resource-based view concerning managerial resources.

Details

Management Decision, vol. 57 no. 1
Type: Research Article
ISSN: 0025-1747

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Book part
Publication date: 22 December 2005

Forrest Briscoe, James Maxwell and Peter Temin

The past two decades have witnessed a transformation in the corporate human resource (HR) function – moving away from a role of balancing multiple interests toward a…

Abstract

The past two decades have witnessed a transformation in the corporate human resource (HR) function – moving away from a role of balancing multiple interests toward a narrower focus on business objectives – yet we know little about how this change occurred. This study finds that the functional backgrounds of senior HR managers played an important role in determining the changing health benefits of large corporations. Managers with finance backgrounds controlled costs more than those with traditional HR backgrounds and contracted with fewer health plans – yet surprisingly without measured differences in health care quality management. These results suggest that more attention should be paid to the backgrounds of managers in the wider evolution of HR.

Details

Advances in Industrial & Labor Relations
Type: Book
ISBN: 978-0-76231-265-8

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Article
Publication date: 5 June 2017

Zhi-Jian Xu, Li Wang and Jing Long

The purpose of this paper is to investigate whether the Boardroom heterogeneity affects IPO underpricing for entrepreneurial firms, where Boardroom heterogeneity was…

Abstract

Purpose

The purpose of this paper is to investigate whether the Boardroom heterogeneity affects IPO underpricing for entrepreneurial firms, where Boardroom heterogeneity was classified in terms of functional background, educational background, age and length of tenure.

Design/methodology/approach

A national research design was conducted using data collected from 355 firms listed on China’s Growth Enterprise Market from its start in 2009 to 2012.

Findings

The author found that IPO underpricing has a significant negative correlation with functional heterogeneity, a positive correlation with educational heterogeneity, a significant negative correlation with age heterogeneity, but it does not show significant correlation with heterogeneity in tenure. Board heterogeneity affects IPO underpricing of entrepreneurial firms partially, which means functional, educational and age heterogeneity conveys signals to potential investors regarding a firm’s quality.

Research/limitations/implications

More entrepreneurial firms in more years for data and long-term performance research design in future research would be required for further understanding of the relationships among the variables in this study.

Practical/implications

This paper suggests that IPO firms may make use of such an influencing mechanism to determine the issue price or to control the IPO underpricing by showing the Boardroom heterogeneity.

Originality/value

This paper revealed the influence of the characteristics of board members of such firms on IPO underpricing, which is rare in recent studies comparing to the study for the top management team; also this study provides empirical support for such effect.

Details

Chinese Management Studies, vol. 11 no. 2
Type: Research Article
ISSN: 1750-614X

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Article
Publication date: 1 June 1997

James L. Price

Addresses the standardization of the measurements and the labels for concepts commonly used in the study of work organizations. As a reference handbook and research tool…

Abstract

Addresses the standardization of the measurements and the labels for concepts commonly used in the study of work organizations. As a reference handbook and research tool, seeks to improve measurement in the study of work organizations and to facilitate the teaching of introductory courses in this subject. Focuses solely on work organizations, that is, social systems in which members work for money. Defines measurement and distinguishes four levels: nominal, ordinal, interval and ratio. Selects specific measures on the basis of quality, diversity, simplicity and availability and evaluates each measure for its validity and reliability. Employs a set of 38 concepts ‐ ranging from “absenteeism” to “turnover” as the handbook’s frame of reference. Concludes by reviewing organizational measurement over the past 30 years and recommending future measurement reseach.

Details

International Journal of Manpower, vol. 18 no. 4/5/6
Type: Research Article
ISSN: 0143-7720

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Article
Publication date: 11 May 2010

Michael A. Abebe

The purpose of this study is to empirically examine the effect of top management team (TMT) characteristics on corporate turnaround performance in declining firms under…

Abstract

Purpose

The purpose of this study is to empirically examine the effect of top management team (TMT) characteristics on corporate turnaround performance in declining firms under conditions of environmental stability and turbulence.

Design/methodology/approach

Theoretical hypotheses were developed and tested using data collected from 98 US manufacturing firms that experienced performance decline and turnaround during the periods 1990‐1994 and 1995‐2000 respectively. Data were collected from the COMPUSTAT database and annual filings and analyzed using a moderated regression analysis.

Findings

The results of moderated regression analysis indicate an adverse effect of long organizational tenure on corporate turnaround, especially in turbulent environments. Hence, if was found that the effect of top team composition on corporate turnaround varies depending on the environmental context.

Research limitations/implications

The study contributes to the ongoing corporate turnaround research by examining the interplay between TMT characteristics and turnaround performance under different environmental contexts. Consequently, the findings of the study suggest that the environmental context in which declining firms operate matter just as much as the nature and characteristics of their top team in determining the success of their turnaround attempt.

Practical implications

The results of the study shed some light on corporate governance issues, specifically on the importance of matching top management change efforts in declining firms with the respective environmental context.

Originality/value

The study contributes to the corporate turnaround literature by addressing the recent call for research in the TMT‐turnaround relationship under environmental contingencies (i.e. environmental stability/turbulence).

Details

Leadership & Organization Development Journal, vol. 31 no. 3
Type: Research Article
ISSN: 0143-7739

Keywords

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