Extant research has shown that firms with high levels of entrepreneurial orientation (EO) outperform competitors. The present study sheds light on this performance relationship in large, publicly listed high-tech firms by examining whether the strength of this relationship depends upon the CEO’s narcissism, an executive personality trait recently debated controversially in both academic and practitioner publications. A theoretically derived research model is empirically validated by means of multisource secondary data for 41 S&P 500 firms from 2005 to 2007. Findings indicate that narcissistic CEOs usually weaken the EO-performance relationship, although the opposite is true under some conditions, such as in highly concentrated and dynamic markets.
AndersonB.EshimaY. in press. The influence of firm age and intangible resources on the relationship between entrepreneurial orientation and firm growth among Japanese SMEs. Journal of Business Venturing.
3.
AndersonE. W.FornellC.MazvancherylS. K.2004. Customer satisfaction and shareholder value. Journal of Marketing, 68 (4): 172-185.
4.
BallingerG. A.2004. Using generalized estimating equations for longitudinal data analysis. Organizational Research Methods, 7: 127-150.
5.
BergerA. N.HannanT. H.1998. The efficiency cost of market power in the banking industry: A test of the “quiet life” and related hypotheses. Review of Economics and Statistics, MIT Press, 80: 454-465.
6.
BogartL. M.BenotschE. G.PavlovicJ. D.2004. Feeling superior but not threatened: The relation of narcissism to social comparison. Basic and Applied Social Psychology, 26: 35-44.
7.
CampbellW.HoffmanB.CampbellS.MarchisioG.2011. Narcissism in organizational contexts. Human Resource Management Review, 21: 268-284.
8.
CampbellW. K.CampbellS. M.2009. On the self-regulatory dynamics created by the peculiar benefits and costs of narcissism: A contextual reinforcement model and examination of leadership. Self & Identity, 8: 214-232.
9.
CampbellW. K.FosterC. A.FinkelE. J.2002. Does self-love lead to love for others? A story of narcissistic game playing. Journal of Personality and Social Psychology, 83: 340-354.
10.
CampbellW. K.ReederG. D.SedikidesC.ElliotA. J.2000. Narcissism and comparative self-enhancement strategies. Journal of Research in Personality, 34: 329-347.
11.
CarpenterM.2002. The implications of strategy and social context for the relationship between top management team hetrogeneity and firm performance. Strategic Management Journal, 23: 275-284.
12.
CarpenterM.SandersW.GregersenH. B.2001. Bundling human capital with organizational context: The impact of international assignment experience on multinational firm performance and CEO pay. Academy of Management Journal, 44: 493-512.
13.
CarpenterM. A.GeletkanyczM. A.SandersW.2004. Upper echelons revisited: Antecedents, elements, and consequences of top management team composition. Journal of Management, 30: 749-778.
14.
CashenL. H.GeigerS. W.2004. Statistical power and the testing of null hypotheses: A review of contemporary management research and recommendations for future studies. Organizational Research Methods, 7: 151-167.
15.
ChatterjeeA.HambrickD. C.2007. It’s all about me: Narcissistic chief executive officers and their effects on company strategy and performance. Administrative Science Quarterly, 52: 351-386.
16.
ChatterjeeA.HambrickD. C.2011. Executive personality, capability cues, and risk taking: How narcissistic CEOs react to their successes and stumbles. Administrative Science Quarterly, 56: 202-237.
17.
ChildJ.1972. Organization structure, environment, and performance: The role of strategic choice. Sociology, 6: 1-22.
18.
CohenJ.1988. Statistical power analysis for the behaviorial sciences. Hillsdale, NJ: Lawrence Erlbaum.
19.
ConnellyB. L.IrelandR. D.ReutzelC. R.CoombsJ. E.2010. The power and effects of entrepreneurship research. Entrepreneurship: Theory & Practice, 34: 131-149.
20.
CovinJ.SlevinD.1989. Strategic management of small firms in hostile and benign environments. Strategic Management Journal, 10: 75-87.
21.
CovinJ.SlevinD.1991. A conceptual model of entrepreneurship as firm behavior. Entrepreneurship Theory and Practice, 16: 7-25.
22.
CovinJ. G.GreenK. M.SlevinD. P.2006. Strategic process effects on the entrepreneurial orientation–sales growth rate relationship. Entrepreneurship: Theory & Practice, 30: 57-81.
23.
CrosslandC.HambrickD. C.2011. Differences in managerial discretion across countries: How nation-level institutions affect the degree to which CEOs matter. Strategic Management Journal, 32: 797-819.
24.
DavisJ. P.EisenhardtK. M.BinghamC. B.2009. Optimal structure, market dynamism, and the strategy of simple rules. Administrative Science Quarterly, 54: 413-452.
25.
DawsonJ.RichterA.2006. Probing three-way interactions in moderated multiple regression: Development and application of a slope difference test. Journal of Applied Psychology, 91: 917-926.
26.
De VriesM. F. R. K.MillerD.1984. Neurotic style and organizational pathology. Strategic Management Journal, 5: 35-55.
DuriauV. J.RegerR. K.PfarrerM. D.2007. A content analysis of the content analysis literature in organizational studies: Research themes, data sources, and methodological refinements. Organizational Research Methods, 10: 5-34.
29.
EllisH.1898. Auto-erotism: A psychological study. Allienist and Neurologist, 19: 260-299.
30.
EmmonsR. A.1987. Narcissism: Theory and measurement. Journal of Personality and Social Psychology, 52: 11-17.
31.
EngelenA.GuptaV. K.StrengerL.BrettelM.2015. Entrepreneurial orientation, firm performance, and the moderating role of transformational leadership. Journal of Management, 41: 1069-1097.
32.
FinkelsteinS.HambrickD.CannellaA.2009. Strategic leadership—Theory and research on executives, top management teams, and boards. Oxford, UK: Oxford University Press.
33.
GatignonH.BartonW.PradeepB.1990. Brand introduction strategies and competitive environments. Journal of Marketing Research, 27 (4): 390-401.
34.
GreenK. M.CovinJ. G.SlevinD. P.2008. Exploring the relationship between strategic reactiveness and entrepreneurial orientation: The role of structure-style fit. Journal of Business Venturing, 23: 356-383.
35.
HairJ.AndersonR.TathamR.BlackW.1998. Multivariate data analysis (5th ed.). Upper Saddle River, NJ: Prentice Hall.
36.
HambrickD. C.2007. Upper echelons theory: An update. Academy of Management Review, 32: 334-343.
37.
HambrickD. C.AbrahamsonE.1995. Assessing managerial discretion across industries: A multi-method approach. Academy of Management Journal, 38: 1427-1441.
38.
HambrickD. C.FinkelsteinS.1987. Managerial discretion: A bridge between polar views on orgainzations. In CummingsL.StawB. (Eds.), Research in organizational behavior: 369-406. Greenwich, CT: JAI Press.
39.
HambrickD. C.MasonP. A.1984. Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9: 193-206.
40.
HartR. P.2000. DICTION 5.0: The text analysis program. Thousand Oaks, CA: Sage-Scolari.
41.
HaywardM.HambrickD.1997. Explaining premiums paid for large acquisitions: Evidence of CEO hubris. Administrative Science Quarterly, 42: 103-127.
42.
HillerN. J.HambrickD. C.2005. Conceptualizing executive hubris: The role of (hyper-)core self-evaluations in strategic decision making. Strategic Management Journal, 26: 297-319.
43.
HofstedeG.2001. Culture’s consequences: Comparing values, behaviors, institutions, and organizations across nations (2nd ed.). Thousand Oaks, CA: Sage.
44.
HowellJ.AvolioB.1993. Transformational leadership, transactional leadership, locus of control, and support for innovations: Key predictors of consolidated-business-unit performance. Journal of Applied Psychology, 78: 891-903.
45.
JaworskiB.KohliA.1993. Market orientation: Antecedents and consequences. Journal of Marketing, 57 (3): 53-70.
46.
JohnO. P.RobinsR. W.1994. Accuracy and bias in self-perception: Individual differences in self-enhancement and the role of narcissism. Journal of Personality and Social Psychology, 66: 206-219.
47.
KerinR. A.VaradarajanP. R.PetersonR. A.1992. First-mover advantage: A synthesis, conceptual framework, and research propositions. Journal of Marketing, 56 (4): 33-52.
48.
Kets de VriesM. F. R.MillerD.1985. Narcissism and leadership: An object relations perspective. Human Relations, 38: 583-601.
49.
KhandwallaK.1977. The design of organizations. New York, NY: Harcourt Brace Jovanovich.
50.
LawrenceB.1997. The black box of organizational demography. Organization Science, 8: 1-22.
51.
LounsburyM.2002. Institutinal transformation and status mobility: The professionalization of the field of finance. Academy of Management Journal, 45: 255-266.
52.
LumpkinG.DessG.1996. Clarifiying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21: 135-172.
53.
LumpkinG. T.DessG.2001. Linking two dimensions of entrepreneurial orientation to firm performance: The moderating role of environment and industry life cycle. Journal of Business Venturing, 16: 429-441.
54.
LuoX.HomburgC.2007. Neglected outcomes of customer satisfaction. Journal of Marketing, 71 (2): 133-149.
55.
MaccobyM.2004. Narcisstic leaders—The incredible pros, the inevitable cons. Harvard Business Review, January-February, 1-9.
56.
MatsunoK.MentzerJ.ÖzsomerA.2002. The effects of entrepreneurial proclivity and market orientation on business performance. Journal of Marketing, 66 (3): 18-32.
57.
McClellandD. C.BurnhamD. H.1976. Power is the great motivator. Harvard Business Review, March-April, 100-110.
58.
McGrathR.1999. Falling forward: Real options reasoning and entrepreneurial failure. Academy of Management Review, 24 (1): 13–30.
59.
MillerD.1983. The correlates of entrepreneurship in three types of firms. Management Science, 29 (7): 770-791.
60.
NadkarniS.HerrmannP. O. L.2010. CEO personality, strategic flexibility, and firm performance: The case of the Indian business outsourcing industry. Academy of Management Journal, 53: 1050-1073.
61.
NevickaB.De HooghA. H. B.Van VianenA. E. M.BeersmaB.McIlwainD.2011. All I need is a stage to shine: Narcissists’ leader emergence and performance. Leadership Quarterly, 22: 910-925.
62.
OzkanN.2011. CEO compensation and firm performance: An empirical investigation of UK panel data. European Financial Management, 17: 260-285.
63.
PodsakoffP.MacKenzieS.MoormanR.FetterR.1990. Transformational leader behaviors and their effects on followers’ trust in leader, satisfaction, and organizational citizenship behaviors. Leadership Quarterly, 1: 107-142.
64.
PriemR.LyonD.DessG.1999. Inherent limitations of demographic proxies in top management team heterogeneity research. Journal of Management, 25: 935-953.
65.
RauchA.WiklundJ.LumpkinG. T.FreseM.2009. Entrepreneurial orientation and business performance: An assessment of past research and suggestions for the future. Entrepreneurship: Theory & Practice, 33: 761-787.
66.
RichardO. C.WuP.ChadwickK.2009. The impact of entrepreneurial orientation on firm performance: The role of CEO position tenure and industry tenure. International Journal of Human Resource Management, 20: 1078-1095.
ShortJ.BrobergJ.CogliserC.BrighamK.2010. Construct validation using computer-aided text analysis (CATA): An illustration using entrepreneurial orientation. Organizational Research Methods, 13: 320-347.
69.
SimsekZ.HeaveyC.VeigaJ. F.2010. The impact of CEO core self-evaluation on the firm’s entrepreneurial orientation. Strategic Management Journal, 31: 110-119.
70.
SrivastavaR. K.ShervaniT. A.FaheyL.1998. Market-based assets and shareholder value: A framework for analysis. Journal of Marketing, 62 (1): 2-18.
71.
StamW.ElfringT.2008. Entrepreneurial orientation and new venture performance: The moderating role of intra- and extraindustry social capital. Academy of Management Journal, 51: 97-111.
72.
TobinJ.1969. A general equilibrium approach to monetary theory. Journal of Money, Credit and Banking, 1: 15-29.
73.
VivekS.2011. Stock returns and product market competition: Beyond industry concentration. Review of Quantitative Finance and Accounting, 37: 283-299.
74.
WalesW.GuptaV.MoussaF. in press. Empirical research on entrepreneurial orientation: An assessment and suggestions for future research. International Small Business Journal.
75.
WalesW.MonsenE.McKelvieA.2011. The organizational pervasiveness of entrepreneurial orientation. Entrepreneurship Theory & Practice, 35: 895-923.
76.
WallaceH.BaumeisterR.2002. The performance of narcissists rises and falls with perceived opportunity for glory. Journal of Personality and Social Psychology, 82: 819-934.
77.
WiklundJ.1999. The sustainability of the entrepreneurial orientation–performance relationship. Entrepreneurship Theory & Practice, 24: 37-48.
78.
WiklundJ.ShepherdD.2005. Entrepreneurial orientation and small business performance: A configurational approach. Journal of Business Venturing, 20: 71-91.
WooldridgeJ. M.2010. Econometric analysis of cross section and panel data (2nd ed.). Cambridge, MA: MIT Press.
81.
ZahraS. A.CovinJ. G.1995. Contextual influences on the corporate entrepreneurship performance relationship: A longitudinal analysis. Journal of Business Venturing, 10: 43-58.
