This article comments on Guthrie, Grimm and Smith’s (1991) examination of the impact of environmental change on top management team characteristics. Specifically, we argue against their approach of predicting directional changes in top executive attributes without first studying the nature of changes that are transforming the context. Since the impact of environmental shifts such as deregulation can vary by industry, we suggest that it is first necessary to examine changes in the dominant mode of competition, before investigating organizational adaptation. We empirically illustrate the value of this method in a study of the U.S. domestic airline industry before and after deregulation. Our results are dramatically opposed to those reported by Guthrie et al. (1991) in the railroad industry.
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