Strategic Decision Making

The Relationships between Top Management Demographic Characteristics, Rational Decision Making, Environmental Munificence, and Firm Performance
Goll, Irene; Rasheed, Abdul A.
The intervening model ‘posits that team demography influences organizational performance entirely through team processes and that it has no direct effects on performance’.
We believe that the integration of these two largely independent, yet
complementary research streams can inform our understanding of decision
processes and their impact on organizational outcomes.
We do so by
simultaneously investigating the impact of TMT demographic characteristics
on rationality in decision making and the moderating role of environmental
munificence in the relationship between decision rationality and organizational
performance.
In other words, if demographic
characteristics are indeed proxies for other underlying managerial traits, it is
easier to collect and measure those characteristics than managerial values or
traits.
The upper echelons perspective is firmly based on the assumption that top
managers account for what happens in and to an organization
A similar perspective is
presented by Gupta (1984) when he suggests that TMT characteristics are
related to strategy and performance.
Priem (1990) proposed a
curvilinear relationship between TMT homogeneity/heterogeneity and firm
performance, and suggested environment as a contextual factor affecting this
relationship.
the extent of
rationality in organizational decision making and its subsequent impact
Consensus binnen TMT
Debate/conflict
on organizational performance.Diversiteit binnen TMT

The demographic approach has also been criticized for its inability to
suggest implementable prescriptive conclusions (Priem et al. 1999). Priem
and Walters (1993) emphasize the need to ‘humanize’ upper echelons
research by including individual factors such as attitudes, judgments, and
choices. Pettigrew (1992) indicts... [continues]

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