The personality factor: how top management teams make decisions. A literature review
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The personality factor: how top management teams make decisions. A literature review Gianpaolo Abatecola • Gabriele Mandarelli Sara Poggesi
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Ó Springer Science+Business Media, LLC. 2011
Abstract Past research has increasingly suggested that CEO/TMT personality can play a relevant role in influencing various external (e.g. firm performance) and internal (e.g. firm organizational structure) management outcomes. These promising results need appropriate systematization and discussion, which we aim at providing through a literature review based on rigorous inclusion/exclusion criteria. Our analysis shows great heterogeneity in regard to both the personality traits and the personality based management outcomes explored by the investigated population of studies. Thus, we specifically use the framework provided by the Five-Factor Model (FFM) of personality to codify the publications and this framework allows us to identify some possible theoretical trajectories. These trajectories mainly regard the empirical testing of the highlighted associations between CEO emotional stability, extraversion and conscientiousness with bureaucratization, strategic pro-activity and firm performance. Our article is primarily intended for those scholars and practitioners who want to improve their knowledge about psychology-based decision making and behavioural corporate governance through the understanding of how CEO/TMT personality can affect their strategic decisions. Keywords CEO Decision making Five-factor model Personality Review Top management team Upper echelons theory Electronic supplementary material The online version of this article (doi: 10.1007/s10997-011-9189-y) contains supplementary material, which is available to authorized users. G. Abatecola (&) S. Poggesi Department of Business Studies, School of Economics, Tor Vergata University, Via Columbia 2, 00133 Rome, Italy e-mail: [email protected] G. Mandarelli Department of Neurosciences, Mental Health and Sensory Organs, School of Medicine and Psychology, Sapienza University, Via di Grottarossa 1035, 00189 Rome, Italy
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1 Introduction Over the years, management scholars have been strongly committed in advancing the comprehension of the behavioral decision dynamics regarding top management teams (hereafter TMTs). Although the research efforts in this area have been tremendously increasing, TMTs can be considered a black box in some respects. In particular, the understanding of how TMTs make decisions needs more research efforts to date. In this article, we aim at focusing on the behavioral decision dynamics regarding TMT members (i.e. CEOs, board chairpersons or other executives, as well as entire TMT groups or other dominant sub-coalitions)1 by systematizing the extant management literature about the relationship between their personality and different external (e.g. firm performance) or internal (e.g. various intra-firm processes) managerial outcomes. Our article has been mainly inspired by the enhancements undergone by
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