Donald C. Hambrick's research while affiliated with Pennsylvania State University and other places

Publications (179)

Article
Business leaders have traditionally avoided wading into society’s debates. Yet more and more CEOs are taking visible public stands on hotly contested issues, engaging in what has come to be called CEO sociopolitical activism. Despite its growing prevalence and potentially major implications, this class of executive behaviors remains largely unexplo...
Chapter
Research on strategic leadership, or the study of top executives and their effects on organizational outcomes, has flourished over the past few decades. Firm strategies are the product of human endeavors, and the individuals most responsible for formulating and implementing strategic initiatives—chief executive officers (CEOs) and their top managem...
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Why do some CEOs become celebrities, while others with seemingly equal accomplishments do not? After two decades of research, far more is known about the substantial consequences of CEO celebrity than about its determinants. Drawing on the media routines literature, we develop and test a “push-pull theory” of CEO celebrity attainment, arguing and f...
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Conceptualizing shareholder unrest as the aggregate scale and gravity of shareholder dissatisfaction with company practices, we examine the effects of two distinct types of shareholder unrest – wealth-oriented and corporate social responsibility (CSR)-oriented – on CEOs’ career outcomes. Drawing on the concept of settling up, we hypothesize that CE...
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We study how the cognitive complexity of chief executive officers (CEOs) changes during their tenures. Drawing from prior theory and research, we argue that CEOs attain gradually greater role-specific knowledge, or expertise, as their tenures advance, which yields more complex thinking. Beyond examining the main effect of CEO tenure on cognitive co...
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RESEARCH SUMMARY Our paper sheds new light on the performance implications associated with insider versus outsider CEOs. We frame CEO selection as risk‐taking, in which outsiders are relatively risky hires, with a greater tendency to generate extreme performance outcomes—either positive or negative—as compared to insiders. We base this expectation...
Chapter
Despite widespread interest in “behavioral strategy,” it is not clear what this term, or its associated academic subfield, is all about. Unless a critical mass of scholars can agree on the meaning of behavioral strategy, and professionally identify with it, this embryonic community may face a marginal existence. We describe three alternative concep...
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This study investigates how CEO behavior and incentives change during the CEO's final years in office, known as the horizon problem. We examine how the horizon problem alters managerial slack, a measure of operational inefficiency and managerial value diversion. Using data on Chinese publicly traded firms between 2003 and 2011, we find that manager...
Preprint
This study investigates how CEO behavior and incentives change during the CEO's final years in office, known as the horizon problem. We examine how the horizon problem alters managerial slack, a measure of operational inefficiency and managerial value diversion. Using data on Chinese publicly traded firms between 2003 and 2011, we find that manager...
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Full-text available
We set forth a new theory for understanding the consequences of CEO celebrity. The fulcrum of our theory is the reality that CEOs attain celebrity because they are cast into specific archetypes, rather than for their general achievements. We present a typology of common celebrity CEO archetypes (creator, transformer, rebel, savior) and then detail...
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Purpose This paper aims to elaborate upon the work of Aguinis and colleagues (this issue), who showed that there is almost no overlap between the chief executive officers (CEOs; of American publicly traded corporations) who are in the upper tail of the CEO pay distribution and the firms that are in the upper tail of the performance distribution....
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We develop a new explanation for why some organizations are relatively evenhanded, while others are more disparate, in allocating resources to subunits. Recognizing the central role of chief executive officers (CEOs) in resource allocation, we argue that CEOs’ personal values regarding egalitarianism, as manifested in their political ideologies, wi...
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Contributing to the sensegiving and organizational change literatures, we set forth a theory for predicting the relative effectiveness, or ineffectiveness, of executive symbolism in advancing new strategic themes (specific new priorities) in organizations. Unpacking the concept of executive symbolism and describing why executive actions carry symbo...
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Research summary: Why do firms vary so much in their stances toward corporate social responsibility (CSR)? Prior research has emphasized the role of external pressures, as well as CEO preferences, while little attention has been paid to the possibility that CSR may also stem from prevailing beliefs among the body politic of the firm. We introduce t...
Chapter
Explicitly set forth by Hambrick, Donald C. (born 1946) and Phyllis A. Mason (1984), upper echelons theory is the idea that top executives view their situations through their own highly personalized lenses. These individualized construals of strategic situations arise because of differences among executives in their experiences, values, personaliti...
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We introduce a new theoretical perspective for predicting effective monitoring, which involves a two-stage logic. First, we focus on individual directors, arguing that effective monitoring is highly likely when a given director possesses certain qualities. Based on prior research not previously coalesced, we set forth this baseline proposition: a d...
Article
Studies of the effects of top management team (TMT) composition on organizational outcomes have yielded mixed and confusing results. A possible breakthrough resides in the reality that TMTs vary in how they are fundamentally structured. Some are structured such that members operate independently of each other, while others are set up such that role...
Chapter
The term “top management team” (TMT) has been adopted by organization and strategy theorists to refer to the relatively small group of most influential executives at the apex of an organization – usually the general manager (see CEO) and his or her direct reports. The term does not necessarily imply a formalized management-by-committee arrangement,...
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We conduct an initial empirical test of a new predictive theory, the “quad model” for assessing the monitoring effectiveness of corporate boards. According to the quad model, a corporate director needs four attributes in order to have a high likelihood of being an effective monitor: independence, expertise in the domain being monitored, bandwidth,...
Article
We shed new light on the double-edged implications of CEO confidence, conceptualized as the personality trait of core self- evaluation (CSE). Our central thesis is that the implications of executive confidence are contextually bounded, arguing that CEO CSE is beneficial under conditions of environmental munificence but harmful if and when the envir...
Article
In this symposium five leading management thought leaders will present their perspectives on the future of governance of the Academy of Management itself. Starting off, two former presidents of the Academy of Management (Don Hambrick and Anne Tsui) will represent an internal perspective on how opening governance can help the AOM itself. Then two pu...
Presentation
2014 marks the 30th anniversary of the birth of Upper Echelons Theory. In this symposium, we want to celebrate this event by exploring future directions for capturing upper echelons’ cognition through their use of verbal communication. Some of the questions we would like to address are: What are the main challenges in using words as proxies for min...
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Despite governance reforms in recent decades, corporate boards still often fail in their oversight responsibilities. We introduce a new theoretical perspective for predicting effective monitoring, which involves a two-stage logic. First, we focus on individual directors, arguing that there are multiple qualities that a director must possess in orde...
Article
We introduce a new explanation for one of the most pronounced phenomena on the American business landscape in recent decades: a dramatic increase in attributions of CEO significance. Specifically, we test the possibility that America's CEOs became seen as increasingly significant because they were, in fact, increasingly significant. Employing varia...
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We introduce multiple refinements to the standard method for assessing CEO effects on performance, variance partitioning methodology, more accurately contextualizing CEOs' contributions. Based on a large 20-year sample, our new ‘CEO in Context’ technique points to a much larger aggregate CEO effect than is obtained from typical approaches. As a val...
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We introduce the concept of CEO career variety – defined as the array of distinct professional and institutional experiences an executive has had prior to becoming CEO. Using a longitudinal sample of Fortune 250 CEOs, we hypothesize, and find strong evidence for the assertion, that CEO career variety is positively associated with firm-level strateg...
Article
In an effort to comprehend activism toward corporations, scholars have proposed the concept of corporate opportunity structure, or the attributes of individual firms that make them more (or less) attractive as activist targets. We theorize that the personal values of the firm's elite decision makers constitute a key element of this corporate opport...
Article
The theme of the Academy of Management Orlando 2013 Conference on “Capitalism in Question” provides a unique opportunity to critically reflect on the ways in which we both define and account for impact. Capitalism as an idea, as much as an economic system, has emerged over time in ways that its effects could not have been predicted and its conseque...
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This article examines the influence on organizational outcomes of CEOs’ political ideology, specifically political conservatism vs. liberalism. We propose that CEOs’ political ideologies will influence their firms’ corporate social responsibility (CSR) practices, hypothesizing that (1) liberal CEOs will emphasize CSR more than will conservative CEO...
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We examine the responses of major pharmaceutical firms to the advent of biotechnology over the period 1980 to 2008 to explain why established firms vary in their adoption of technological discontinuities. Combining insights from upper echelons theory, personality theory, and research on organizational responses to new technologies, we posit that na...
Article
Countering the widely held view that chief executive officer (CEO) succession is generally beneficial in turnaround situations, we adopt an executive fit/refit logic, proposing that the implications of CEO replacement depend integrally on the incumbent's degree of misfit and the successor's degree of fit to the contextual conditions at hand. Drawin...
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We consider a central puzzle surrounding CEO accountability: What explains the payoffs and penalties that CEOs receive? Invoking Fama's concept of "settling up," we examine how a CEO's entire performance record and history of prior over- or underpayment affect current pay and the odds of dismissal. We find that some parts of a CEO's historical trac...
Article
The concept of managerial discretion provides a theoretical fulcrum for resolving the debate about whether chief executive officers (CEOs) have much influence over company outcomes. In this paper, we operationalize and further develop the construct of managerial discretion at the national level. In an empirical examination of 15 countries, we find...
Article
We adopt an interactionist logic to study the determinants of risk taking by chief executive officers (CEOs). We introduce the concept of “capability cues”—contextual signals that decision makers might reasonably interpret as indicators of their current level of overall ability—arguing that positive cues will induce boldness, while negative cues wi...
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In this study, we adopt the logic of upper echelons theory to expand understanding of how executive personality shapes organizational responses to radical change. Specifically, we hypothesize that, due to their supreme confidence and craving for attention, narcissistic CEOs propel early and aggressive adoption of technological discontinuities by es...
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Prior research on CEO succession has omitted consideration of a critical institutional reality: some exiting CEOs do not fully depart the scene but instead remain as board chairs. We posit that predecessor retention restricts a successor’s discretion, thus dampening their ability to make strategic changes or deliver performance that deviates from p...
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A wealth of research indicates that both executive characteristics and incentive compensation affect organizational outcomes, but the literatures within these two domains have followed distinct, separate paths. Our paper provides a framework for integrating these two perspectives. We introduce a new model that specifies how executive characteristic...
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The article examines factors contributing to variations in executives' levels of confidence and proposes that executive confidence is influenced by contextual stimuli but that it is moderated by the executive's decision. The concept of capability cues is presented, which are described as contextual signals that decision makers might interpret as in...
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Young, unproven firms can signal their worthiness, or potential, through affiliations with various types of prestigious parties. Drawing from signaling theory, we present a formal consideration of the implications of multiple numbers and types of prestigious affiliates for IPO valuations. We argue that different types of prestigious affiliates – pr...
Chapter
Research on top management teams commenced in the organisations literature around 1980 (Bourgeois, 1980) and has been pervasive ever since (e.g., Bantel and Jackson, 1989; Carpenter et al., in press; Eisenhardt and Schoonhoven, 1990; Finkelstein and Hambrick, 1996; Fredrickson and Iaquinto, 1989; Hambrick, 1981). In an effort to move beyond an exam...
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Thousands of scholars and millions of dollars are devoted to the study of management. In the last decade, the number of active members of the Academy of Management has increased by more than 50 percent, to 17,607 members. The number of management journals continues to grow as well. These rates of growth suggest that many academics are seeing benefi...
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Using the concept of managerial discretion, we find that retention of the predecessor CEO as board chair following succession results in reduced organizational and strategic change and reduced performance extremeness. Further, upon departure of the predecessor as board chair, there is an immediate increase in these measures.
Article
Scholars have studied how the social associations of corporate executives affect their access to information and their decisions. The entire focus, however, has been on lateral peer-to-peer associations. Prior research has not addressed vertical associations, or the idea that interaction with peer elites yields different perceptions and behaviors t...
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Acquisition integration is a pivotal factor in determining whether the objectives of an acquisition are achieved. In this paper, we hypothesize that the productivity of corporate scientists of acquired companies is generally impaired by integration, but that some scientists experience more disruption than others. In particular, acquisition integrat...
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We describe two theoretical explanations for the amount, pace, and costs of the prestige enhancement a firm engages in during the year before its initial public offering. The "snowball model" captures well-known processes whereby prestige-rich organizations accumulate even more prestige. The "dressing-up model" builds upon deadline-induced remediat...
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Over the last few decades, the topic of corporate gov- ernance has attracted substantial interest from scholars in a wide array of academic fields. Attention to gov- ernance can be found in departments of accounting, finance, management, organization behavior, and strat- egy, as well as departments of economics, sociology, psychology, and law. Some...
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Numerous histories of the early days of individual academic fields have been written, but scholars generally have stopped short of proposing generalizable frameworks or testable propositions for why these focal fields survived and prospered. We integrate logics from social movement theory and the sociology of science to model the rise of an aspirin...
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We develop a model to explain the process by which corporate failure leads to professional devaluation of individual elites. We envision that corporate failure evokes a stigmatization process, in which society's arbiters engage in constituentminded sensemaking to interpret the conditions surrounding the failure, including the characteristics of the...
Article
I suspect that many members of our field, including those in leadership positions, believe that our hypercommitment to theory - and particularly the requirement that every article must contribute to theory - is somehow on the side of the angels. They may believe that this is a hallmark of a serious field. They may believe that theory is good and th...
Article
We unpack the concept of managerial risk taking, distinguishing among three of its major elements: the size of an outlay, the variance of potential outcomes, and the likelihood of extreme loss. We then apply our framework in hypothesizing the effects of CEO stock options on strategic behavior and company performance. We find that CEO stock options...
Article
It is commonly asserted that the field of strategic management is fragmented and lacks a coherent identity. This skepticism, however, is paradoxically at odds with the great success that strategic management has enjoyed. How might one explain this paradox? We seek answers to this question by relying first on a large-scale survey of strategic manage...
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This study uses unobtrusive measures of the narcissism of chief executive officers (CEOs)—the prominence of the CEO's photograph in annual reports, the CEO's prominence in press releases, the CEO's use of first-person singular pronouns in interviews, and compensation relative to the second-highest-paid firm executive—to examine the effect of CEO na...
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Do CEOs matter more in some countries than in others? Based on a theoretical consideration of three fundamental national-level institutions—national values, prevailing firm ownership structures, and board governance arrangements—we argue that CEOs in different countries face systematically different degrees of constraint on their latitudes of actio...
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The purpose of this paper is to introduce new evidence of the extent to which, and circumstances under which, upper-level executives specialize their environmental scanning activities according to their hierarchical levels and functional areas. Results suggest that neither of these two role variables is closely or consistently related to the focus...
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The central premise of upper echelons theory is that executives' experiences, values, and personalities greatly influence their interpretations of the situations they face and, in turn, affect their choices. At the invitation of the editor, I recap the AMR article in which the theory was originally presented (Hambrick & Mason, 1984), discuss subseq...
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This study tests the suppositions that (1) industries differ in their key success factors, and (2) firms whose strengths match those factors will perform well. A typology of mature industrial-product industries, classified according to their core technology and transaction complexity, allows very strong prediction of key success factors in differin...
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Widely considered a disparate field without a well-defined paradigm, strategic management has nonetheless achieved strong institutional success. How might this lack of paradigmatic consensus be related to the field's success? We conduct an empirical study based on interview and survey data from a select group of interdisciplinary strategic manageme...
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We integrate the upper-echelons perspective with the attention-based view of the firm by examining the role of attentional orientation of top management teams (TMTs). In the context of airline deregulation, we find that deregulation caused a shift in managerial attention, but that this shift in attention was the greatest for firms that changed the...
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Scholars have characterized CEO tenures as life cycles in which executives learn rapidly during their initial time in office, but then grow stale as they lose touch with the external environment. We argue, however, that the opportunities for adaptive learning are limited because (1) a CEO assumes office with a relatively fixed paradigm that changes...
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The article presents three ideas about how management scholars can make themselves more relevant in the world of practical affairs. First, those who are associated with business schools should use their acquired expertise to improve the management skills of business executives. Second, scholars need to make their presence felt in the formulation of...