The role of top management team diversity in shaping the performance of business model innovation: a threshold effect |
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Authors: | Bin Guo Xueqing Pang |
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Affiliation: | School of Management, Zhejiang University, Hangzhou, People’s Republic of China |
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Abstract: | Business model innovation is one of the firm’s most important strategic decisions. Top management team (TMT), as the critical decision-makers, has essential influence upon such decisions. However, the role of TMT diversity in shaping the performance of business model innovation is less explored in the literature. Based on a sample dataset of 906 observations of small and medium enterprises from China Startups Stock Market during the period of 2009–2011, we find that TMT diversity exhibits a significant threshold effect on the relationship between business model innovation (in terms of novelty-centred and efficiency-centred business model) and firm performance. More specifically, when TMT functional diversity arrives at a certain level, the positive relationship between novelty-centred business model and firm performance becomes more pronounced. On the other hand, the positive relationship between efficiency-centred business model innovation and firm performance will be more significant when TMT tenure diversity increases to a certain level. |
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Keywords: | Top management team business model innovation functional diversity tenure diversity firm performance |
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