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How does top management team diversity matter in abruptly dynamic environments?

    Wein-Hong Chen Affiliation
    ; Yi-Yuan Liu Affiliation

Abstract

This study seeks to investigate how top management team (TMT) diversity as a double-edged sword influences a firm’s resilient performance in abruptly dynamic environments and how TMT group longevity moderates this relationship. Abruptly dynamic environment is characterized by low-frequency, substantial magnitude, and high-degree irregularity of change. Utilizing 168 listed electronics firms in Taiwan as the sample, this study incorporated the context of the 2008 global financial crisis as a naturally quasi-experimental setting and adopted a less investigated performance metric, firm resilient performance, to investigate how the two most researched types of TMT job-related diversity (i.e., educational and functional diversity) influence firm resilience in such environments. The results suggest that in abruptly dynamic environments, TMT job-related diversity negatively influences firms’ resilient performance, and TMT longevity significantly moderates this relationship. This study makes unique contributions to the upper-echelons literature by investigating the effect of TMT diversity in a naturally quasi-experimental setting featuring abrupt environmental dynamism.

Keyword : dynamic environments, global financial crisis, resilient performance, top management team diversity, uncertainty, upper echelons theory

How to Cite
Chen, W.-H., & Liu, Y.-Y. (2018). How does top management team diversity matter in abruptly dynamic environments?. Journal of Business Economics and Management, 19(3), 521-543. https://doi.org/10.3846/jbem.2018.6579
Published in Issue
Nov 19, 2018
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