Kevin D. Clark and Patrick G. Maggitti A critical success factor for firms facing today’s turbulent and competitive environment is the action of an able executive team. Top management teams (TMTs) affect the performance of their firms in many ways, the most direct being through the strategic decisions they make (Child, 1972; Finkelstein and Hambrick, 1996). Indeed, the decisions TMTs make, and the timeliness with which they make them, are arguably the most important determinants of success or failure for the firm. Despite the importance of the topic, TMT research has been limited because of unique methodological challenges that exist in attaining access to and information from top managers. The strategic context is also problematic for researchers because it is very complex, ambiguous, and involves decisions that unfold over long periods of time. In this chapter, we briefly discuss the state of research on top management teams and call for more varied approaches to knowledge creation in this area. We offer suggestions about new methodologies to uncover important relationships in the hopes of better understanding TMT functioning. In an effort to model our recommendations, we present a study of TMT confidence (potency) in which we use a dual design. Specifically, a positivist theorytesting approach is first used to establish the importance of top management team potency for decision speed followed by an inductive outlier analysis, which we use to develop propositions concerning functional vs. dysfunctional potency. TMT RESEARCH METHODOLOGY AND THE CREATION OF KNOWLEDGE Three main characteristics of the strategic...
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