IDEAS home Printed from https://ideas.repec.org/a/bla/stratm/v39y2018i4p1139-1162.html
   My bibliography  Save this article

Performance feedback and middle managers’ divergent strategic behavior: The roles of social comparisons and organizational identification

Author

Listed:
  • Murat Tarakci
  • Nüfer Yasin Ateş
  • Steven W. Floyd
  • Yoojung Ahn
  • Bill Wooldridge

Abstract

Research Summary: What drives middle managers to search for new strategic initiatives and champion them to top management? This behavior—labeled divergent strategic behavior—spawns emergent strategies and thereby provides one of the essential ingredients of strategic renewal. We conceptualize divergent strategic behavior as a response to performance feedback. Data from 123 senior middle managers overseeing 21 multi‐country organizations (MCOs) of a Fortune 500 firm point to social performance comparisons rather than historical comparisons in driving divergent strategic behavior. Moreover, managers’ organizational identification affects whether they attend to organizational‐ or individual‐level feedback. These results contribute to research on performance aspirations and strategy process by providing a multilevel, multidimensional framework of performance aspirations in middle management driven strategic renewal. Managerial Summary: Middle managers are essential actors in strategic renewal. Their unique positions offer insights into operations alongside knowledge of strategy. In contrast to typical assessments of managerial performance with reference to a prior year, this research shows that performance comparisons relative to peers and other organizational units better motivate managers’ divergent strategic behavior. Our results also show that managers who identify with the firm are more attentive to organizational rather than individual performance discrepancies. Thus, our study unveils an important approach for organizations aiming to spark strategic renewal.

Suggested Citation

  • Murat Tarakci & Nüfer Yasin Ateş & Steven W. Floyd & Yoojung Ahn & Bill Wooldridge, 2018. "Performance feedback and middle managers’ divergent strategic behavior: The roles of social comparisons and organizational identification," Strategic Management Journal, Wiley Blackwell, vol. 39(4), pages 1139-1162, April.
    • Handle: RePEc:bla:stratm:v:39:y:2018:i:4:p:1139-1162
    DOI: 10.1002/smj.2745
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/smj.2745
    Download Restriction: no
    File URL: https://libkey.io/10.1002/smj.2745?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Bill Wooldridge & Steven W. Floyd, 1990. "The strategy process, middle management involvement, and organizational performance," Strategic Management Journal, Wiley Blackwell, vol. 11(3), pages 231-241, March.
    2. Hornsby, Jeffrey S. & Kuratko, Donald F. & Zahra, Shaker A., 2002. "Middle managers' perception of the internal environment for corporate entrepreneurship: assessing a measurement scale," Journal of Business Venturing, Elsevier, vol. 17(3), pages 253-273, May.
    3. Marianne Bertrand & Sendhil Mullainathan, 2003. "Enjoying the Quiet Life? Corporate Governance and Managerial Preferences," Journal of Political Economy, University of Chicago Press, vol. 111(5), pages 1043-1075, October.
    4. Jared Harris & Philip Bromiley, 2007. "Incentives to Cheat: The Influence of Executive Compensation and Firm Performance on Financial Misrepresentation," Organization Science, INFORMS, vol. 18(3), pages 350-367, June.
    5. Robert E. Hoskisson & Michael A. Hitt, 1988. "Strategic control systems and relative r&d investment in large multiproduct firms," Strategic Management Journal, Wiley Blackwell, vol. 9(6), pages 605-621, November.
    6. James M. Pappas & Bill Wooldridge, 2007. "Middle Managers' Divergent Strategic Activity: An Investigation of Multiple Measures of Network Centrality," Journal of Management Studies, Wiley Blackwell, vol. 44(3), pages 323-341, May.
    7. Ikujiro Nonaka, 1994. "A Dynamic Theory of Organizational Knowledge Creation," Organization Science, INFORMS, vol. 5(1), pages 14-37, February.
    8. Saku Mantere & Eero Vaara, 2008. "On the Problem of Participation in Strategy: A Critical Discursive Perspective," Organization Science, INFORMS, vol. 19(2), pages 341-358, April.
    9. Justin J. P. Jansen & Frans A. J. Van Den Bosch & Henk W. Volberda, 2006. "Exploratory Innovation, Exploitative Innovation, and Performance: Effects of Organizational Antecedents and Environmental Moderators," Management Science, INFORMS, vol. 52(11), pages 1661-1674, November.
    10. Steven W. Floyd & Bill Wooldridge, 1997. "Middle Management’s Strategic Influence and Organizational Performance," Journal of Management Studies, Wiley Blackwell, vol. 34(3), pages 465-485, May.
    11. W. J. Henisz, 2000. "The Institutional Environment for Economic Growth," Economics and Politics, Wiley Blackwell, vol. 12(1), pages 1-31, March.
    12. Giovanni Gavetti & Daniel Levinthal & William Ocasio, 2007. "Perspective---Neo-Carnegie: The Carnegie School’s Past, Present, and Reconstructing for the Future," Organization Science, INFORMS, vol. 18(3), pages 523-536, June.
    13. Joel A. C. Baum & Kristina B. Dahlin, 2007. "Aspiration Performance and Railroads’ Patterns of Learning from Train Wrecks and Crashes," Organization Science, INFORMS, vol. 18(3), pages 368-385, June.
    14. Mary Ann Glynn, 2000. "When Cymbals Become Symbols: Conflict Over Organizational Identity Within a Symphony Orchestra," Organization Science, INFORMS, vol. 11(3), pages 285-298, June.
    15. William Ocasio, 2011. "Attention to Attention," Organization Science, INFORMS, vol. 22(5), pages 1286-1296, October.
    16. Zannie Giraud Voss & Daniel M. Cable & Glenn B. Voss, 2006. "Organizational Identity and Firm Performance: What Happens When Leaders Disagree About “Who We Are?”," Organization Science, INFORMS, vol. 17(6), pages 741-755, December.
    17. Charles W. L. Hill & Michael A. Hitt & Robert E. Hoskisson, 1992. "Cooperative Versus Competitive Structures in Related and Unrelated Diversified Firms," Organization Science, INFORMS, vol. 3(4), pages 501-521, November.
    18. Michelle Rogan & Marie Louise Mors, 2014. "A Network Perspective on Individual-Level Ambidexterity in Organizations," Organization Science, INFORMS, vol. 25(6), pages 1860-1877, December.
    19. Ulrike Malmendier & Timothy Taylor, 2015. "On the Verges of Overconfidence," Journal of Economic Perspectives, American Economic Association, vol. 29(4), pages 3-8, Fall.
    20. Tomasz Obloj & Todd Zenger, 2017. "Organization Design, Proximity, and Productivity Responses to Upward Social Comparison," Organization Science, INFORMS, vol. 28(1), pages 1-18, February.
    21. Robert A. Burgelman, 1991. "Intraorganizational Ecology of Strategy Making and Organizational Adaptation: Theory and Field Research," Organization Science, INFORMS, vol. 2(3), pages 239-262, August.
    22. Kyung Min Park, 2007. "Antecedents of Convergence and Divergence in Strategic Positioning: The Effects of Performance and Aspiration on the Direction of Strategic Change," Organization Science, INFORMS, vol. 18(3), pages 386-402, June.
    23. Vibha Gaba & John Joseph, 2013. "Corporate Structure and Performance Feedback: Aspirations and Adaptation in M-Form Firms," Organization Science, INFORMS, vol. 24(4), pages 1102-1119, August.
    24. Tom J. M. Mom & Frans A. J. van den Bosch & Henk W. Volberda, 2009. "Understanding Variation in Managers' Ambidexterity: Investigating Direct and Interaction Effects of Formal Structural and Personal Coordination Mechanisms," Organization Science, INFORMS, vol. 20(4), pages 812-828, August.
    25. Audia, Pino G. & Brion, Sebastien, 2007. "Reluctant to change: Self-enhancing responses to diverging performance measures," Organizational Behavior and Human Decision Processes, Elsevier, vol. 102(2), pages 255-269, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xiao, Shufeng & Tian, Xiaocong, 2023. "Performance feedback and location choice of foreign direct investment," International Business Review, Elsevier, vol. 32(4).
    2. Zhang, Jintao & Su, Taoyong & Meng, Li, 2024. "Retreat in order to advance: Environmental performance below legality aspiration and corporate disclosure strategy," International Review of Financial Analysis, Elsevier, vol. 93(C).
    3. Verver, Hugo & van Zelst, Marino & Lucas, Gerardus Johannes Maria & Meeus, Marius, 2019. "Understanding Heterogeneity in the Performance Feedback – Organizational Responsiveness Relationship: A Meta-Analysis," OSF Preprints hq4uw, Center for Open Science.
    4. Pramendra Singh Tank, 2023. "Unlocking the Power of Accelerators: The Crucial Role of Institutions in Boosting New Venture Performance," IIMA Working Papers WP 2023-04-04, Indian Institute of Management Ahmedabad, Research and Publication Department.
    5. Liying Huang & Lerong He & Guangqing Yang, 2021. "Performance Shortfalls and R&D Investment Change: Aspirations, Actions, and Expectations," Sustainability, MDPI, vol. 13(6), pages 1-21, March.
    6. Juha-Antti Lamberg & Jukka Luoma, 2021. "Ideology in Vicarious Learning–Related Communication," Organization Science, INFORMS, vol. 32(3), pages 708-730, May.
    7. Diwei Lv, David & Zhu, Hang & Chen, Weihong & Lan, Hailin, 2021. "Negative performance feedback and firm cooperation: How multiple upward social comparisons affect firm cooperative R&D," Journal of Business Research, Elsevier, vol. 132(C), pages 872-883.
    8. Yuanyuan Hu & Shouming Chen & Runshi Liu & Yi Dai, 2023. "Managers’ aspirations and quality of CSR reports: evidence from China," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-10, December.
    9. Fazal-E-Hasan, Syed Muhammad & Neale, Larry & Sekhon, Harjit & Mortimer, Gary & Brittain, Ian & Sekhon, Jaswinder, 2021. "The path to game-day attendance runs through sports fan rituals," Journal of Business Research, Elsevier, vol. 137(C), pages 308-318.
    10. Lv, David Diwei & Chen, Weihong & Zhu, Hang & Lan, Hailin, 2019. "How does inconsistent negative performance feedback affect the R&D investments of firms? A study of publicly listed firms," Journal of Business Research, Elsevier, vol. 102(C), pages 151-162.
    11. Samir L. Vaz & Anneloes M. L. Raes & Mariano L. M. Heyden, 2022. "Realizing implementation through relational exchanges with top managers: the mediating role of middle managers’ divergent strategic behavior," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 33(1), pages 81-108, March.
    12. Songsong Cheng & Qunpeng Fan & Yang Song, 2023. "Performance Gap and Innovation Ambidexterity: A Moderated Mediation Model," Sustainability, MDPI, vol. 15(5), pages 1-22, February.
    13. Dong, Meitong & Wang, Liwen & Yang, Defeng & Zhou, Kevin Zheng, 2022. "Performance feedback and export intensity of Chinese private firms: Moderating roles of institution-related factors," International Business Review, Elsevier, vol. 31(3).
    14. Deb, Palash & David, Parthiban & O'Brien, Jonathan P. & Duru, Augustine, 2019. "Attainment discrepancy and investment: Effects on firm performance," Journal of Business Research, Elsevier, vol. 99(C), pages 186-196.
    15. Luca Berchicci & Murat Tarakci, 2022. "Aspiration formation and attention rules," Strategic Management Journal, Wiley Blackwell, vol. 43(8), pages 1575-1601, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lin-Hua Lu & Poh-Kam Wong, 2019. "Performance feedback, financial slack and the innovation behavior of firms," Asia Pacific Journal of Management, Springer, vol. 36(4), pages 1079-1109, December.
    2. Luke Rhee & William Ocasio & Tae-Hyun Kim, 2019. "Performance Feedback in Hierarchical Business Groups: The Cross-Level Effects of Cognitive Accessibility on R&D Search Behavior," Organization Science, INFORMS, vol. 30(1), pages 51-69, February.
    3. John Joseph & Ronald Klingebiel & Alex James Wilson, 2016. "Organizational Structure and Performance Feedback: Centralization, Aspirations, and Termination Decisions," Organization Science, INFORMS, vol. 27(5), pages 1065-1083, October.
    4. Thomas Schaefer & Thomas Guenther, 2016. "Exploring strategic planning outcomes: the influential role of top versus middle management participation," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 27(2), pages 205-249, May.
    5. Daniel A. Levinthal & Claus Rerup, 2021. "The Plural of Goal: Learning in a World of Ambiguity," Organization Science, INFORMS, vol. 32(3), pages 527-543, May.
    6. Samir L. Vaz & Anneloes M. L. Raes & Mariano L. M. Heyden, 2022. "Realizing implementation through relational exchanges with top managers: the mediating role of middle managers’ divergent strategic behavior," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 33(1), pages 81-108, March.
    7. van den Oever, Koen, 2017. "Uncharted waters : A behavioral approach to when, why and which organizational changes are adopted," Other publications TiSEM 0136c8c2-ecdd-4f82-8ca7-d, Tilburg University, School of Economics and Management.
    8. Hortovanyi, Lilla & Szabo, Roland Zs & Fuzes, Peter, 2021. "Extension of the strategic renewal journey framework: The changing role of middle management," Technology in Society, Elsevier, vol. 65(C).
    9. Linda Argote & Henrich R. Greve, 2007. "A Behavioral Theory of the Firm ---40 Years and Counting: Introduction and Impact," Organization Science, INFORMS, vol. 18(3), pages 337-349, June.
    10. Abraham Carmeli & Ari Dothan & Dev Kumar Boojihawon, 2020. "Resilience of sustainability‐oriented and financially‐driven organizations," Business Strategy and the Environment, Wiley Blackwell, vol. 29(1), pages 154-169, January.
    11. Alexander Zimmermann & Sebastian Raisch & Julian Birkinshaw, 2015. "How Is Ambidexterity Initiated? The Emergent Charter Definition Process," Organization Science, INFORMS, vol. 26(4), pages 1119-1139, August.
    12. Cheng, Lulu & Xie, En & Fang, Junyi & Mei, Nan, 2022. "Performance feedback and firms’ relative strategic emphasis: The moderating effects of board independence and media coverage," Journal of Business Research, Elsevier, vol. 139(C), pages 218-231.
    13. Steven W. Floyd & Bill Wooldridge, 1999. "Knowledge Creation and Social Networks in Corporate Entrepreneurship: The Renewal of Organizational Capability," Entrepreneurship Theory and Practice, , vol. 23(3), pages 123-144, April.
    14. Tammy E. Beck & Donde Ashmos Plowman, 2009. "Experiencing Rare and Unusual Events Richly: The Role of Middle Managers in Animating and Guiding Organizational Interpretation," Organization Science, INFORMS, vol. 20(5), pages 909-924, October.
    15. Michael Lounsbury & Christine M. Beckman, 2015. "Celebrating Organization Theory," Journal of Management Studies, Wiley Blackwell, vol. 52(2), pages 288-308, March.
    16. Linda Argote & Sunkee Lee & Jisoo Park, 2021. "Organizational Learning Processes and Outcomes: Major Findings and Future Research Directions," Management Science, INFORMS, vol. 67(9), pages 5399-5429, September.
    17. Andreea N. Kiss & Dirk Libaers & Pamela S. Barr & Tang Wang & Miles A. Zachary, 2020. "CEO cognitive flexibility, information search, and organizational ambidexterity," Strategic Management Journal, Wiley Blackwell, vol. 41(12), pages 2200-2233, December.
    18. Elizabeth Boyle & Zur Shapira, 2012. "The Liability of Leading: Battling Aspiration and Survival Goals in the Jeopardy! Tournament of Champions," Organization Science, INFORMS, vol. 23(4), pages 1100-1113, August.
    19. Louise Lindbjerg & Theodor Vladasel, 2021. "Hiring Entrepreneurs for Innovation," Working Papers 1309, Barcelona School of Economics.
    20. Tiziana Callari & Corinne Bieder & Barry Kirwan, 2019. "What is it like for a middle manager to take safety into account? Practices and challenges," Post-Print hal-01935746, HAL.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:stratm:v:39:y:2018:i:4:p:1139-1162. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1111/0143-2095 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.