Contents

1 Sydney Finkelstein, Donald C. Hambrick, Albert A. CannellaStrategic leadershipTheory and research on executives, top management teams, and boardsContents1 The Study of Top Executives 3 The Essence of Strategic Leadership 4 Academic Attention to Executives: A Historical View 6 The Scope of Strategic Leadership 9 Chief Executive Officers 9 Business Unit Heads 10 Top Management Teams 10 Boards of Directors 11 Additional Matters of Scope 11 Overview of the Book 122Do Top Executives Matter?

2 16 What Do Top Executives Do? 17 Basic Dimensions of the Job 19 Do Managers Matter? A Doubtful View 20 Do Managers Matter? A Positive View 22 Problems with Lieberson and O'Connor's Study 23 Evidence of Executive Effects 24 Managerial Discretion 26 Environmental Sources 27 Organizational Sources 31 Individual Sources 33 Effects of Discretion 34 Executive Job Demands 37 The Managerial Mystique 38 Conclusion 40xii CONTENTS3 How Individual Differences Affect Executive Action 43A Model of Human Limits on Strategic Choice 44 The Filtering Process 4 6 Executive Orientation.

3 An Overview 49 Psychological Characteristics as Bases for Executive Action 51 Executive Values 52 Cognitive Model 59 Executive Personality 70 Positive Self-Regard 76 Conclusion 824 Executive Experiences and Organizational Outcomes 83 Executive Tenure 85 Tenure and Executive Psychology 85 Tenure and Organizational Strategy 90 Tenure and Performance 93 Functional Background 97 Functional Experiences and Executive Perceptions 97 Links to Strategy and Performance 101 Future Research on Functional Experiences 104 Formal Education 106 International Experience 112 Future Directions 113 Promising Avenues of Research 114 A Still-Untapped Perspective: The Factors Affecting the Predictive Strength of Executive Characteristics 116 Which Traits?

4 117 Which Behaviors? 118 Which People? 119 Which Situations? 119 Conclusion 1205 Top Management Teams 121 The Conceptual Elements of Top Management Teams 123 How the Conceptual Elements of TMTs Are Related 125 Teams versus Groups 126 Who Is in the Top Group? 127 Power Dynamics at the Top 128 Interactions within TMTs 131 The CEO and Team Process 137 CONTENTSD eterminants of TMT Characteristics 138 Environment 138 Organization 142 GEO 148 Consequences of TMTs' Interaction 152 Consequences of TMTs on Strategic Decision Making 152 Consequences of TMTs on Strategy 154 Consequences of TMTs on Firm Performance 158 Conclusion 1626 Changes at the Top.

5 The Antecedents of Executive Turnover and Succession 164 Will Succession Occur? Determinants of Top Executive Departure 166 Organizational Performance 168 Agency Conditions 171 Other Organizational Characteristics 174 Environment 176 Predecessor (Incumbent) Characteristics 178 What Will Be the Dynamics of the Succession Process? 179 Types of Successions 179 Influence of the Incumbent versus the Board 183 Who Will Be Selected? 185 Insider versus Outsider Selection 186 The Broader Case of Continuity versus Change 194 Conclusion 1967 Changes at the Top: The Consequences of Executive Turnover and Succession 198 What Are the Consequences of Succession?

6 199 The New Executive's Behaviors and Organizational Change 200 Implications for Organizational Performance 204 Executive Turnover: Beyond the CEO 213 Other Interesting Issues for Succession 224 Conclusion 2258 Understanding Board Structure, Composition, and Vigilance 227 Determinants of Board Structure and Composition 229 What Do We Mean by Board Structure and Composition? 229 Critical Contingencies 232 Institutional Forces 234 Agency Conditions 238xiv CONTENTSD eterminants of Board Vigilance 243 Board Vigilance in Monitoring and Disciplining Top Management 243 Competition versus Cooperation in Board-CEO Relations 251 Conclusion 2539 The Consequences of Board Involvement and Vigilance 255 Board Involvement in Strategy Formation 255 Contextual Conditions Predicting Board Strategic Involvement 263 Boards and Firm Performance 269 Board

7 Effects on Strategy 270 Boards as Supra-Top Management Teams 277 Board Monitoring and Disciplinary Behavior 281 Boards and Executive Compensation 282 Boards and Monitoring Behaviors 284 Conclusion 28910 The Determinants of Executive Compensation 291 Organizing Dimensions for a Framework of Executive CompensationDirection of Causality 291 Theoretical Perspectives 292 Unit of Analysis 293 Economic Explanations for Executive Compensation 295 Research from the Managerialist and Neoclassical Traditions 295 Moderators of the Pay-Performance Relationship 296 Human Capital 305 Marginal Product and the Managerial Labor Market 309, Social Explanations for Executive Compensation 310 Isomorphism of Executive Compensation 312 Social Comparison Processes in the Setting of Executive Pay 315 Social Capital 318 Political Explanations for Executive Compensation 320 Compensation for Business Unit General Managers.

8 Determinants and Consequences 324GM Compensation versus CEO Compensation 324 The Determinants of GM Compensation 325 The Consequences of GM Compensation 327 Conclusion 32811 Executive Compensation: Consequences and Distributions 330 Consequences of Executive Compensation 330 Economic Explanations for the Consequences of Executive CompensationCONTENTSxvBehavioral Agency Theory 337 Social Explanations for the Consequences of Executive Compensation 344 Political Explanations for the Consequences of Executive Compensation 346 Distribution of Compensation within Top Management Teams 348 Pay Differentials between CEOs and Other Executives in the Firm 348 Pay Dispersion within Top

9 Management Teams 356 TMT and CEO Compensation Patterns 361 Conclusion 364 Notes 367 References 383 Index 451