The impact of executive team competency-sharing degree on firm innovation performance
Abstract
In China’s high-quality development context, the key role of executive teams in corporate innovation is increasingly prominent. However, effectively utilizing the synergistic effect of competencies within these teams to boost innovation performance remains a crucial research issue. A sample of 2,350 companies in Shanghai and Shenzhen A-shares from 2010 to 2022 was used to examine the impact of the executive team’s capability-sharing degree on firm innovation performance. The study indicates that the degree of managerial competence sharing, entrepreneurial competence sharing, and technological competence sharing within the executive team positively impacts firm innovation performance. These findings remain robust in the face of variations in dependent variable measures, lagged independent variables, and the propensity score matching method. Environmental dynamism is identified as playing a positive moderating role in the relationship between the influence of managerial, entrepreneurial, and technological capability-sharing degrees and firm innovation performance. Further analysis of heterogeneity reveals that the impact of the executive team’s capability-sharing degree on firms’ innovation performance varies based on the nature of property rights, firm size, and industry competitiveness. This study, grounded in top-level ladder theory, offers a framework for enhancing team capabilities and overcoming growth obstacles through executive team competence sharing.
Keyword : executive team, competency-sharing degree, innovation performance, environmental dynamism, top-level ladder theory, team capabilities
How to Cite
Shao, Y., Qu, L., Liu, P., & Ding, L. (2024). The impact of executive team competency-sharing degree on firm innovation performance. Journal of Business Economics and Management, 25(5), 921–938. https://doi.org/10.3846/jbem.2024.22289
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Chen, J., Miller, D., & Chen, M.-J. (2021). Top management team time horizon blending and organizational ambidexterity. Strategic Organization, 19(2), 183–206. https://doi.org/10.1177/1476127019883669
Del Giudice, M., Scuotto, V., Papa, A., Tarba, S. Y., & Bresciani, S. (2021). A self‐tuning model for smart manufacturing SMEs: Effects on digital innovation. Journal of Product Innovation Management, 38(1), 68–89. https://doi.org/10.1111/jpim.12560
Do, H., Budhwar, P., Shipton, H., Nguyen, H.-D., & Nguyen, B. (2022). Building organizational resilience, innovation through resource-based management initiatives, organizational learning and environmental dynamism. Journal of Business Research, 141, 808–821. https://doi.org/10.1016/j.jbusres.2021.11.090
Georgakakis, D., Heyden, M. L. M., Oehmichen, J. D. R., & Ekanayake, U. I. K. (2022). Four decades of CEO – TMT interface research: A review inspired by role theory. The Leadership Quarterly, 33(3), Article 101354. https://doi.org/10.1016/j.leaqua.2019.101354
Gruber, M., Kim, S. M., & Brinckmann, J. (2015). What is an attractive business opportunity? An empirical study of opportunity evaluation decisions by technologists, managers, and entrepreneurs. Strategic Entrepreneurship Journal, 9(3), 205–225. https://doi.org/10.1002/sej.1196
Huynh, K., Wilden, R., & Gudergan, S. (2022). The interface of the top management team and the board: A dynamic managerial capabilities perspective. Long Range Planning, 55(3), Article 102194. https://doi.org/10.1016/j.lrp.2022.102194
Jia, Y., Tsui, A. S., & Yu, X. (2021). Beyond bounded rationality: CEO reflective capacity and firm sustainability performance. Management and Organization Review, 17(4), 777–814. https://doi.org/10.1017/mor.2021.4
Jiang, Y., Wang, D., & Zeng, Q. (2021). Can founders’ dual roles facilitate innovation? – from the perspective of founders’ R&D network characteristics. Journal of Business Economics and Management, 22(5), 1288–1307. https://doi.org/10.3846/jbem.2021.14950
Kafetzopoulos, D. (2023). Environmental dynamism and sustainability: The mediating role of innovation, strategic flexibility and HR development. Management Decision, 61(6), 1697–1716. https://doi.org/10.1108/MD-06-2022-0759
Kim, B., & Lee, S. (2022). The impact of celebrity CEOs on restaurant firm performance: The moderating role of environmental dynamism. Journal of Business Research, 139, 869–880. https://doi.org/10.1016/j.jbusres.2021.10.031
Knudsen, T., & Srikanth, K. (2014). Coordinated exploration: Organizing joint search by multiple specialists to overcome mutual confusion and joint myopia. Administrative Science Quarterly, 59(3), 409–441. https://doi.org/10.1177/0001839214538021
Kotter, J. (2012). How the most innovative companies capitalize on today’s rapid-fire strategic challenges-and still make their numbers. Harvard Business Review, 90(11), 43–58.
Lazar, M., Miron-Spektor, E., Agarwal, R., Goldfarb, B., & Chen, G. (2020). Entrepreneurial team formation. Academy of Management Annals, 14(1), 29–59. https://doi.org/10.5465/annals.2017.0131
Li, Z.-G., Wu, Y., & Li, Y.-K. (2023). Technical founders, digital transformation and corporate technological innovation: Empirical evidence from listed companies in China’s STAR market. International Entrepreneurship and Management Journal. https://doi.org/10.1007/s11365-023-00852-7
Ma, S., Kor, Y. Y., & Seidl, D. (2022). Top management team role structure: A vantage point for advancing upper echelons research. Strategic Management Journal, 43(8). https://doi.org/10.1002/smj.3368
Marion, T. J., & Fixson, S. K. (2021). The transformation of the innovation process: How digital tools are changing work, collaboration, and organizations in new product development. Journal of Product Innovation Management, 38(1), 192–215. https://doi.org/10.1111/jpim.12547
Marvel, M. R., Davis, J. L., & Sproul, C. R. (2016). Human capital and entrepreneurship research: A critical review and future directions. Entrepreneurship Theory and Practice, 40(3), 599–626. https://doi.org/10.1111/etap.12136
Marvel, M. R., Wolfe, M. T., & Kuratko, D. F. (2020). Escaping the knowledge corridor: How founder human capital and founder coachability impacts product innovation in new ventures. Journal of Business Venturing, 35(6), Article 106060. https://doi.org/10.1016/j.jbusvent.2020.106060
Menshawy, I. M., Basiruddin, R., Mohd‐Zamil, N.-A., & Hussainey, K. (2023). Strive towards investment efficiency among Egyptian companies: Do board characteristics and information asymmetry matter? International Journal of Finance & Economics, 28(3), 2382–2403. https://doi.org/10.1002/ijfe.2540
Pitelis, C. N., & Wagner, J. D. (2019). Strategic shared leadership and organizational dynamic capabilities. The Leadership Quarterly, 30(2), 233–242. https://doi.org/10.1016/j.leaqua.2018.08.002
Reese, D., Rieger, V., & Engelen, A. (2021). Should competencies be broadly shared in new ventures’ founding teams? Strategic Entrepreneurship Journal, 15(4), 568–589. https://doi.org/10.1002/sej.1356
Rindova, V., & Courtney, H. (2020). To shape or adapt: Knowledge problems, epistemologies, and strategic postures under Knightian uncertainty. Academy of Management Review, 45(4), 787–807. https://doi.org/10.5465/amr.2018.0291
Sarfraz, M., He, B., Shah, S. G. M., & Fareed, Z. (2021). Myth or reality? Unveiling the effectiveness of hierarchical CEO succession on firm performance and cash holdings. Journal of Business Economics and Management, 22(4), 1008–1025. https://doi.org/10.3846/jbem.2021.13559
Sternad, D., & Mödritscher, G. (2022). Entrepreneurial leaps: Growth processes in transition phases between dynamic states. Entrepreneurship Theory and Practice, 46(4), 952–984. https://doi.org/10.1177/1042258720929890
Stieglitz, N., Knudsen, T., & Becker, M. C. (2016). Adaptation and inertia in dynamic environments. Strategic Management Journal, 37(9), 1854–1864. https://doi.org/10.1002/smj.2433
Sun, L., Liu, S., & Chen, P. (2022). Does the paternalism of founder-managers improve firm innovation? Evidence from Chinese non-state-owned listed firms. Finance Research Letters, 49, Article 103146. https://doi.org/10.1016/j.frl.2022.103146
Wang, K. K., Cheng, M. M., & Chang, L. J. (2023). Reducing strategy surrogation: The effects of performance measurement system flexibility and environmental dynamism. The Accounting Review, 98(4), 435–456. https://doi.org/10.2308/TAR-2019-0523
Yeganegi, S., Laplume, A. O., & Dass, P. (2021). The role of information availability: A longitudinal analysis of technology entrepreneurship. Technological Forecasting and Social Change, 170, Article 120910. https://doi.org/10.1016/j.techfore.2021.120910
Yuan, C., Xue, D., & He, X. (2021). A balancing strategy for ambidextrous learning, dynamic capabilities, and business model design, the opposite moderating effects of environmental dynamism. Technovation, 103, Article 102225. https://doi.org/10.1016/j.technovation.2021.102225
Zahra, S. A., Sapienza, H. J., & Davidsson, P. (2006). Entrepreneurship and dynamic capabilities: A review, model and research agenda. Journal of Management Studies, 43(4), 917–955. https://doi.org/10.1111/j.1467-6486.2006.00616.x