THE USE OF VARIANCE DECOMPOSITION IN THE INVESTIGATION OF CEO EFFECTS: HOW LARGE MUST THE CEO EFFECT BE TO RULE OUT CHANCE?

• 成果类型: Article
• 署名作者: Fitza, Markus A.
• 署名单位: Texas A&M University System; Texas A&M University College Station; Mays Business School; University of Newcastle
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.2192
• 发表日期: 2014
• 页码: 1839-1852
• 关键词: VARIANCE DECOMPOSITION; CEO effect; CHANCE; sources of performance heterogeneity; CEOS

摘要

Variance decomposition analysis is often used to examine the degree to which CEOs influence their companies' performance (the so-called CEO effect). Such studies play an important role in a body of literature that investigates the effect of leadership on organizations. In this paper, I argue that these previous studies have an important underlying flaw. Empirically, these studies wrongly attribute the performance effect of randomness-of chance-to the CEO. I demonstrate how randomness can affect the measured effects in a variance decomposition analysis, and I show that this is especially problematic for the measurement of CEO effects. I demonstrate how this results in a greatly inflated CEO effect and develop an approach to correct for it. Copyright (C) 2013 John Wiley & Sons, Ltd.