Dysfunctional Executive Behavior

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Business Horizons (2010) 53, 581—590

www.elsevier.com/locate/bushor

Dysfunctional executive behavior: What can organizations do? James K. Summers a,*, Timothy P. Munyon b, Alexa A. Perryman c, Gerald R. Ferris d Foster College of Business Administration, Bradley University, 1501 West Bradley Avenue, Peoria, IL 61625, U.S.A. b College of Business Administration, University of Central Florida, Orlando, FL 32816-1991, U.S.A. c Neeley School of Business, Texas Christian University, Fort Worth, TX 76129, U.S.A. d College of Business, Florida State University, Tallahassee, FL 32306-1110, U.S.A. a

KEYWORDS
CEO dysfunctional behavior; Work design; Job design; Accountability; Discretion; Work relationships; Executive governance

Abstract Much has been made of dysfunctional executive behavior in recent years. As such, the purpose of this article is to assist organizations in the design of executive work. To better construct a work environment that diminishes self-serving and unethical behavior, we propose that organizations structure an executive’s work around three factors: the accountability environment, managerial discretion, and relationship composition. These factors are used to describe how organizations can better design executives’ work so as to promote more desirable executive behavior. We describe how these factors should be calibrated, as well as how they affect each other. # 2010 Kelley School of Business, Indiana University. All rights reserved.

1. Bad executive! Bad executive!
A cursory review of the local, national, and international news tends to highlight the now commonplace occurrence of corporate scandal, dealing with what may be euphemistically termed dysfunctional’ executive behavior. When reviewing the actions of former corporate leaders such as Skilling, Lay, ‘

* Corresponding author. E-mail addresses: jsummers@bradley.edu (J.K. Summers), tmunyon@bus.ucf.edu (T.P. Munyon), a.a.perryman@tcu.edu (A.A. Perryman), gferris@cob.fsu.edu (G.R. Ferris).

Anderson, Kozlowski, Thain, and Madoff, questions arise concerning how these individuals came to power, and how they were able to exploit and corrupt their organizations. Indeed, given the prevalence of corporate scandals, it would be easy–—albeit admittedly cynical–—to view dysfunctional executive behavior as the norm. Nevertheless, dysfunctional executive behavior is neither universal nor inevitable, but the broad-ranging implications of such behavior suggest that corporations should seek viable solutions and preventive measures to promote functional and ethical behavior among their top executives. Corporations already operate under external governance mechanisms, with the most notable being

0007-6813/$ — see front matter # 2010 Kelley School of Business, Indiana University. All rights reserved. doi:10.1016/j.bushor.2010.06.005

582 oversight by the board of directors (BOD). External steps also have been taken to encourage transparency and disclosure by corporations (e.g., SarbanesOxley; Compensation Discussion and Analysis provisions). However, these actions do little to improve the work environment and incentive structure that may predict dysfunctional executive behavior in the first place. Consequently, we suggest that organizations reexamine the role of work design as a potential means of promoting functional and ethical executive behavior. Work design broadly refers to management of the process, content, output, and context of jobs. Work design has been used for decades by organizations to manage employee work to achieve greater efficiency, effectiveness, and commitment to organizational goals. Until recently, however, the application of work design has been limited to more technical and structured jobs located at the lower levels of the organization (for an exception, see Munyon, Summers, Buckley, Ranft, & Ferris, 2010). As a result, we suggest ways that organizations can help curb executive misconduct by utilizing three dimensions of...
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