Performance Shortfall, Top Management Team Faultlines, and R&D Investment: Evidence from China

With the increasing uncertainty of the world economic situation, enterprises are facing the pressure of downward performance, and R&D has been an important strategic choice to solve the performance fall problem of high-tech enterprises. The article tries to explore the changes in the R&D investment intensity of enterprises under different performance lag levels and investigate the influence of the combination of characteristics of top management team(TMT) members on the strategic decision-making process. It is found that the relationship between the degree of performance disparity and R&D investment intensity is inverted U-shaped; the strength of the fracture faultline of the top management team negatively regulates the relationship between the degree of performance disparity and R&D investment and makes the inverted U-shaped curve flat. A further study of specific characteristic fracture bands revealed that team fracture bands based on tenure characteristics had a significant negative moderating effect, while professional and functional background fracture bands had a significant positive moderating effect. This study not only theoretically expands the understanding of the performance shortall and TMT disconnection on the deep-seated motivation of enterprise R&D investment, but also provides practical references for solving the problem of performance gap, optimizing the allocation of TMT human resources, and rationally promoting enterprise R&D investment to achieve transformation.