Does female representation in top management improve firm performance? A panel data investigation

We argue that female representation in top management brings informational and social diversity benefits to the top management team, enriches the behaviors exhibited by managers throughout the firm, and motivates women in middle management. The result should be improved managerial task performance and thus better firm performance. We test our theory using 15 years of panel data on the top management teams of the S&P 1,500 firms. We find that female representation in top management improves firm performance but only to the extent that a firm's strategy is focused on innovation, in which context the informational and social benefits of gender diversity and the behaviors associated with women in management are likely to be especially important for managerial task performance. Copyright © 2012 John Wiley & Sons, Ltd.     

Organizational capabilities and business performance: When and how does the dark side of managerial ties matter?

Though the dark side of business-to-business relationships exists at both the firm and personal level, recent research evidence suggests that the theoretical conceptualization and empirical investigation concerning the latter is still under development. Building upon theoretical perspectives of organizational capability, organizational networking and social capital theories, this study investigates the boundary conditions of personalized business-to-business relationships (managerial ties) on business performance. Specifically formulated hypotheses are tested using the perceptions of senior executives in 137 Taiwanese firms operating in a variety of industrial sectors. Our study extends extant literature by revealing that the dark side of managerial ties is evident in the perceived management capability-political ties-performance and technology capability-business ties-performance interplays. More importantly our survey results are corroborated by evidence from interview results with twelve senior executives. Such findings collectively demonstrate the dark side of political ties (governmental interference in employment, blockage of information flow as well as conflicts of interest), and business ties (reciprocal obligations, time consuming factors and maintenance costs).     

When does transitioning from family to professional management improve firm performance?

Using long‐term data on Japanese family firms, this study explores when the transition from family to professional management leads to better performance. In order to avoid endogeneity bias, we employ propensity score matching and difference‐in‐differences techniques. We find evidence that firms that transition from family to professional CEOs outperform those that maintain family leadership. This performance improvement is more pronounced when (1) families maintain high ownership control but leave no family legacy behind, (2) when the transition moves from non‐founder family managers to professionals, and (3) when professional managers graduated from elite universities. Copyright © 2014 John Wiley & Sons, Ltd.     

Do board chairs matter? The influence of board chairs on firm performance

Research summary : We use a variance decomposition methodology to assess the degree to which board chairs may influence their companies' performance. To isolate the board chair effect, we focus on firms in which the CEO and board chair positions are separated. Using a U.S. sample of 6,290 firm‐year observations representing 1,828 board chairs in 308 different industries, our results indicate that the board chair effect is substantial at about nine percent. Drawing on resource dependency theory, we also theorize and show how this board chair effect is contingent on the task environment in which firms operate. Our results add to the literature examining the role and influence of board chairs and the context in which chairs may have a greater impact on performance. Managerial summary : Following institutional and regulatory changes, more firms are separating the CEO and board chair positions. With an increasing number of individuals separate from the CEO serving as board chairs, a critical question becomes: What influence do these separate board chairs have on firm performance? Prior research suggests that separate board chairs can provide important resources—including advice and counsel, legitimacy, information linkages, and preferential access to external commitments and support—to their CEOs, other top managers, and overall firms. In turn, who the board chair is and the individual's ability (or lack thereof) to provide these resources may have a significant impact on firm performance. Offering support for this perspective, we find that separate board chairs explain nine percent of the variance in firm performance. Copyright © 2016 John Wiley & Sons, Ltd.     

Extending the firm vs. industry debate: Does industry life cycle stage matter?

A series of Strategic Management Journal studies have debated the extent to which business‐unit, corporate parent, and industry effects explain variance in firm performance. Despite evidence that the industry life cycle impacts competition and performance, the life cycle concept has yet to be incorporated into the firm vs. industry debate. Building on ideas from systems theory, we use longitudinal data from 1,957 firms in 49 industries to examine the relative importance of business‐unit, corporate parent, and industry effects during the growth, maturity, and decline stages of the industry life cycle. We find that corporate parent and industry effects increase as industries move through the life cycle while business‐unit effects decrease between maturity and decline. Thus, the life cycle concept should be incorporated within the firm vs. industry debate. Copyright © 2013 John Wiley & Sons, Ltd     

Telecommunications reform and efficiency performance: Do good institutions matter?

Until recently, most studies investigating telecommunication reforms performance have failed to incorporate the importance of institutions into the empirical analysis. This study highlights the importance of institutional governance on telecommunications efficiency and provides empirical results for the impact of institutions on reform outcomes. It provides significant evidence that the institutional environment in which reform progress takes place is an important determinant for successful reform. This study uses the stochastic distance function approach to capture the role of institutions in explaining efficiency differences across 70 countries. The empirical analysis reveals that policy stability in the form of substantive checks and balances on executive power is the most important aspect for successful reform. Independently, legal integrity improves telecommunications efficiency through privatization, while greater freedom from corruption influences the effectiveness of a regulatory body.     

Does subnational region matter? Foreign affiliate performance in the United states and China

This study examines the extent to which subnational regions can explain foreign affiliate performance in two host country settings, the United States and China, the world's two largest economies at polar ends of the economic spectrum (i.e., an advanced versus an emerging economy). Our results suggest that the subnational region is significant in explaining foreign affiliate performance, thus confirming its importance as an additional unit of analysis for firm performance. This study also shows that the effects of subnational region are far stronger in China than they are in the United States, thus suggesting that regional differences are more critical in their explanatory power for firm performance in emerging economies than they are in advanced economies. Copyright © 2010 John Wiley & Sons, Ltd.     

Does knowledge management matter for information technology applications in China?

This study explores the role of knowledge management (KM) in mediating and moderating the relationship between information technology (IT) and firm performance based upon the data collected from 236 firms in China. Through a structural equation model and hierarchical regression analysis, we found that KM capability partially mediated the performance impact of IT resources. Furthermore, KM capability affected the strength of the IT-performance relationship. The theoretical contributions and managerial implications are discussed and limitations of the study are highlighted accordingly.

Does firm performance reveal its own causes? the role of Bayesian inference

A central problem in strategic management is how the inference ‘sustainable competitive advantage generates sustainable superior performance’ can be put into practice. In this article we develop a theoretical framework to understand the causal relationships among (1) sustainable competitive advantage, (2) configuration, (3) dynamic capability, and (4) sustainable superior performance. We propose that a firm's competitive advantage, resource bundle configuration, and dynamic learning capability cannot be comprehended by outsiders. Its operational performance, however, can be captured by financial indicators. We promote an inductive Bayesian interpretation of the sustainable competitive advantage proposition. From this viewpoint, the presence or absence of competitive advantage may be reflected in the causal relationship between resource configuration, dynamic capability, and observable financial performance. We apply this theoretical framework to an example drawn from the global semiconductor industry, an area in which resource configuration and dynamic capability are essential to performance. The paper concludes with a summary of the proposed model and suggestions for future theoretical development of strategic management. Copyright © 2009 John Wiley & Sons, Ltd.     

Advertising to businesses: Does creativity matter?

Business-to-business advertising research has long been grounded in rationality with a focus on factual, functional, benefit-laden messages. However, in consumer advertising, psychological differentiators, such creativity, are frequently used to increase advertising effectiveness. With growing evidence that consumer marketing concepts apply to business buyers, this research investigates the effect advertising creativity has on the organizational buying process. Using an online survey, we present actual advertisements to managers in the B2B environment. Our results provide strong evidence that message creativity influences business managers' response toward advertising for site selection. Creative ads generated stronger shifts in attitudes toward the ad, attitudes toward the brand, and behavioral intentions. The results extend previous research on the role of creativity in advertising to a business-to-business context. The results also challenge conventional wisdom and dominant practices in advertising to businesses.     

Does corporate strategy matter?

A revisionist view that corporate strategy does not matter has gained considerable influence in recent years. This view largely stems from empirical results of early variance decomposition studies that found negligible corporate effects associated with profitability differences between businesses. Our analysis of the variance decomposition literature shows this view to be incorrect. Not only do the studies as a group show that factors at the corporate level of organizations contribute to profitability differences, but also evidence suggests that factors specifically associated with corporate strategy contribute to corporate effects. Corporate strategy in fact does matter. Copyright © 2001 John Wiley & Sons, Ltd.     

Does ownership matter in private equity? The sources of variance in buyouts' performance

We study the impact of ownership on firm performance in an unexplored governance context: private equity (PE) firms and the buyouts in which they invest. We employ a multiple‐membership, cross‐classified, multilevel model on a unique database of 6,950 buyouts realized by 255 PE firms between 1973 and 2008 in 77 countries. The results document a significant PE firm effect (4.6%), the importance of which grows as time passes. We then study three contingencies that increase the importance of the PE firm effect: (1) value addition vs. selection strategies; (2) developed vs. emerging economies; and (3) economic downturns. Our findings shed new light on the sources of variance in buyouts' performance. Copyright © 2014 John Wiley & Sons, Ltd.     

Governance by targets and the performance of cross-sector partnerships: Do partner diversity and partnership capabilities matter?

Research Summary: This study examines the effectiveness of targets as a tool for the contractual governance of cross-sector partnerships. Applying a difference-in-differences methodology, we find that the use of explicit targets within performance contracts is an effective means for improving partnership outcomes, especially where partner diversity and partnership capabilities are high. Furthermore, we find evidence that target intensity is associated with stronger partnership performance. These findings suggest that contractual forms with explicit targets may be a particularly successful approach for enhancing the public value created by cross-sector partnerships. A downward turn in performance following the removal of targets lends further support to this conclusion. Managerial Summary: Cross-sector partnerships have become a vital means for creating value in pursuit of the public interest. In particular, the effective management of these partnerships is thought to hold the key to addressing the strategic and organizational challenges posed by major social and environmental issues, such as big data and climate change. In this article, we combine data on waste recycling from 2003 to 2014 with information on performance contracts between local cross-sector partnerships and higher levels of government in England to quantify the impact of governance by targets on the performance of those partnerships. The benefits of target-setting for partnership performance that we identify are even stronger when partner diversity is high and partnership capabilities are strong. We discuss the managerial and policy implications of our findings.     

When is cash good or bad for firm performance?

Research summary: Cash can create shareholder value when used for adaptation to unfolding contingencies, but can also reduce value when appropriated by other stakeholders. We synthesize arguments from the behavioral theory of the firm, economic perspectives like agency theory, and the value‐creation versus value‐appropriation literatures to argue that the implications of cash for firm performance are context‐specific. Cash is more beneficial for firms operating in highly competitive, research‐intensive, or growth‐focused industries that are typical of contexts requiring adaptation in the face of uncertainties. Conversely, cash is more detrimental to performance in firms that are poorly governed, diversified, or opaque, as are typical of contexts where stakeholder conflicts, information asymmetries, or power imbalances can encourage value appropriation by other stakeholders. Managerial summary: Cash can create shareholder value when used for adaptation to unfolding contingencies, but can also reduce value when appropriated by other stakeholders. While cash‐rich firms have higher performance on average, with those in the 75th percentile having a market‐to‐book value 15 percent higher than those in the 25th percentile, we find that the performance benefits of cash depend on the context. Cash is more beneficial for firms operating in highly competitive, research‐intensive, or growth‐focused industries that are typical of contexts requiring adaptation in the face of uncertainties. Conversely, cash is more detrimental to performance in firms that are poorly governed, diversified, or opaque, as are typical of contexts where stakeholder conflicts, information asymmetries, or power imbalances can encourage value appropriation by other stakeholders. Copyright © 2015 John Wiley & Sons, Ltd.     

How much does owner type matter for firm performance? Manufacturing firms in China 1998–2007

Who owns the firm (the state, private ownership, foreign investors) has long been an important topic for research on organizations. This paper estimates how much ownership contributes to firm performance, compared to other factors, including industry, region, firm size, year, and the firm itself. The data are on manufacturing firms in mainland China from 1998 to 2007. We find that the effect of owner type is significant and pervasive across regions and interacts with both geography and time, reflecting China's decentralized system and the strong trend in privatization. Copyright © 2014 John Wiley & Sons, Ltd.     

Does the use of knowledge integration mechanisms enhance product innovativeness?

This study draws upon the perspectives of organizational learning and environmental contingency to investigate how the use of knowledge integration mechanisms affects product innovativeness under different levels of technological turbulence, market turbulence, and competitive intensity. Based on a sample of 102 high-tech product projects, hierarchical moderated regression analyses reveal that product innovativeness is related to knowledge integration mechanisms in a curvilinear manner under different levels of competitive intensity, market turbulence, and technological turbulence. Specifically, under a low level of competitive intensity, market turbulence and technological turbulence, the relationship between knowledge integration mechanisms and product innovativeness is an inverted U-shape. By contrast, under a high level of competitive intensity, market turbulence, and technological turbulence, product innovativeness is related to knowledge integration mechanisms in a U-shaped manner.     

Social media in B2B sales: Why and when does salesperson social media usage affect salesperson performance?

The importance of social media usage by B2B salespeople has been well documented in the sales literature. In particular, a B2B salesperson's use of social media to prospect for customers and adapt their sales approach have primarily been shown to explain sales performance. However, an increasing body of literature in the sales domain has called for B2B salespeople to be ambidextrous by engaging in service activities aimed at helping their customers. We argue that by giving B2B salespeople an opportunity to communicate directly with their customers, social media is used by salespeople to proactively service their customers and hence can play a critical role in driving sales performance. Drawing from the Task-Technology Fit theory, we develop and test a conceptual model in which B2B salesperson social media usage affects salesperson performance indirectly through value-oriented prospecting and proactive servicing. Additionally peer social media usage was a key moderator in the relationship between B2B salesperson social media usage on the one hand and value-oriented prospecting and proactive servicing on the other hand. We test the model with data from 171 B2B salespeople and find that salesperson social media usage relates positively with proactive servicing and value-oriented prospecting. While we did not find support for the relationship between social media usage and adaptive selling, we did find support for the impact of all three sales activities salesperson performance. In addition, results show that peer social media usage has positive moderating effects on the B2B salesperson social media usage and value-oriented prospecting/proactive servicing relationships.     

Diversification and top management team complementarity: is performance improved by merging similar or dissimilar teams?

This study examines the impact of complementary top management teams (defined as differences in functional backgrounds between the acquiring and acquired firm managers) on post-acquisition performance. Based on a sample of 147 acquisitions completed during 1986–88, we find that complementary backgrounds have a positive impact on postacquisition performance in both related and unrelated acquisitions. Another major finding is that complementarity is negatively related to top management team turnover among acquired managers, suggesting that differences in functional backgrounds are more easily integrated into the new organization. Finally, top management team turnover among acquired managers is negatively related to postacquisition performance. These findings highlight the importance of examining complementarity in terms of differences, and reinforce the notion that differences have the potential to create unique value for the organization. © 1997 by John Wiley & Sons, Ltd.     

How does sales force automation influence relationship quality and performance? The mediating roles of learning and selling behaviors

Sales force automation (SFA) technologies are increasingly used to support customer relationship management strategies. However, previous studies have reported mixed results about the performances of SFA technologies. Therefore, this study seeks to further examine the impact of SFA usage on both customer relationship quality and sales performance. Additionally, the mediating roles of learning and adaptive selling behaviors on the outcomes of SFA usage are investigated. The results highlight the mediating role of salesperson learning and adaptive selling behaviors in the SFA usage and sales performance relationship. Especially noteworthy is the impact of learning through adaptive selling on those outcome variables. Implications for SFA research and practice that may further improve our understanding of this increasingly relevant topic are also offered.