Board Involvement in the Strategic Decision Making Process PDF Download

Author: William Q. Judge
Publisher: Now Publishers
ISBN: 9781680832600
Category : Business & Economics
Languages : en
Pages : 136

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Book Description
The board of directors is legally responsible for setting the strategic direction of the firm and for ensuring the firm's long-term performance in almost all governance environments. However, many boards delegate the task of creating and executing the firm's strategy to a group of full-time professional managers. This separation between ownership and control creates many challenges for the modern-day firm, and the board's role in the strategy formation process is arguably the seminal governance challenge confronting boards today. Board Involvement in the Strategic Decision Making Process: A Comprehensive Review examines this seminal challenge.

Author: Karen Ford Eickhoff
Publisher:
ISBN:
Category :
Languages : en
Pages : 160

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Book Description
This study describes the antecedents and consequences of the direct involvement of boards in forming the strategies of the organizations they serve. If boards are involved directly and early in the strategic decision making process rather than being held at the periphery, board members may become important assets to their organizations as strategy makers beyond their limited contributions as monitors or advisors. By providing a look inside the "black box" of decision making in board rooms, this research addresses a gap in the strategy and board literatures and has important practical implications for executives and board members who are interested in utilizing their boards to the greatest advantage for their organizations. Board members and chief executive officers who are currently making strategic decisions in a hospital context detailed their involvement in the decision making process in their responses to surveys designed for this study. Utilizing structural equation modeling for analyzing these responses, this study indicates that board members who bring human capital, social capital, and Board Capital (human and social capital in concert) to the board room are more likely to participate early in the strategic decision making process by raising or clarifying issues, generating or evaluating alternatives, or choosing strategies rather than only coming into the process at the end to review and accept or reject the recommendations of the top management team. And when board members are directly involved in forming strategy, the strategic decisions are more likely to be implemented and the implemented strategies are more likely to result in positive financial outcomes. Thus, boards as strategy makers impact the strategic decision making process and the organization in important ways. This study has shown that there are identifiable antecedents and positive consequences of boards acting as strategy makers.

Author: Winfried Ruigrok
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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Book Description
Boards of directors have a number of roles. The board's monitoring function has been the subject of much work. Less examined is the role that the board has in setting company strategy. This paper uses agency and network perspectives in developing and testing the relationship between board characteristics and involvement in strategic decision making. Using primary and secondary data, our results suggest that the level of board involvement in strategic decision making is related to a number of governance variables. We demonstrate that involvement is generally lower where boards are highly interlocked. We also show that certain types of board interlocks namely horizontal (same industry) and those involving direct links with the banking sector are particularly associated with this negative effect. There is weaker evidence that board strategic involvement is lower where the roles of company chief executive and chair are combined. We find no evidence that factors such as board size, or the percentage of outside directors per se are related to board involvement in strategic decision making. In doing so, this paper adds to the growing literature synthesizing the structural features and processes of boards.

Author: Jay W. Lorsch
Publisher: Now Publishers
ISBN: 9781680832464
Category : Business & Economics
Languages : en
Pages : 64

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Book Description
Understanding Boards of Directors examines why research on corporate governance has been slow and uneven, and where that research should turn next to be most valuable to practitioners. The author traces the history of research on corporate boards and analyzes the trends in that research, including the relative value of the types of data that researchers in this field have used, and ultimately identifying the best path forward in studying these complex social systems.

Author: Philip Stiles
Publisher: OUP Oxford
ISBN: 0191580937
Category :
Languages : en
Pages : 182

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Book Description
Boards of directors are coming under increasing scrutiny in terms of their contribution in monitoring and controlling management, particularly in the wake of high-profile corporate frauds and failures, and also their potential to add value to organizational performance through involvement in the strategy process and through building relationships with key investors. Despite the importance of these issues, not only to organizations but also arguably to national competitiveness, the nature of board activity remains largely a black box, clouded by prescriptions, prejudices, and half-truths. This book responds to calls for greater scrutiny of boards of directors with an in-depth examination of directors of UK organizations, drawing on the accounts of directors themselves as to their roles, influence, and the potential and limits to their power. Much work on boards of directors has labelled the board as a rubber stamp for dominant management, and non-executive directors in particular have been variously described as poodles, pet rocks, or parsley on the fish. Such accounts are rooted in assumptions of board activity that are essentially adversarial in nature, and that the solution to the 'problem' of reconciling the interests of managers with those of shareholders is to increase the checks and balances available to the board of directors. The findings of this study show that boards, in many cases, are far more than passive rubber stamps for management and that non-executives are encouraged to act as trusted advisers to the executives and the chief executive, rather than solely monitors of executive activity. Boards are important mechanisms in maintaining the strategic framework of the organization through setting the boundaries of organizational activity. The potential of the board members, in particular the non-executives, to fulfil such a mandate depends on a number of factors, including ability, willingness to engage with the organizational issues, and the degree of knowledge they have relevant to the host firm. Above all, the degree of trust built between members of the board, and between the board and key external constituencies, is at the heart of effective board behaviour.

Author: William Q. Judge
Publisher:
ISBN:
Category :
Languages : en
Pages : 186

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Book Description

Author: Mason A. Carpenter
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Book Description
Prior research has given little consideration to external determinants of knowledge and perspective that may affect directors' ability to contribute to the strategic decision making process. We introduce a framework on board involvement in which the potential for directors to contribute to firm governance and strategic decision making (i.e., in the form of monitoring and advising top management) is critically influenced by (1) whether they hold appointments to other firms with more or less-related product, corporate, and international strategies, and (2) whether such a portfolio of board appointments is suited to the degree of environmental instability surrounding the focal firm. Hypotheses are tested with a comprehensive data set that combines archival reports with behavioral data obtained through surveys of Forbes 1000 directors and CEOs. The findings suggest that while the simple number of director appointments to other boards does not influence board involvement, appointments that have the potential to provide directors with relevant strategic knowledge and perspective do enhance the board's ability to contribute to the strategic decision making process. Support for the theoretical framework presented in this study helps answer recent calls for board research that examines the quot;substantive contextquot; of board appointments, and moves our understanding beyond the number of such appointments or director independence as predictors of board decision making. The findings also show the potential power of models that link the broader, social-structural context in which boards are embedded, as well as the environmental conditions that surround them, with micro-behavioral processes that occur inside the quot;black boxquot; of corporate boards.

Author: Morten Huse
Publisher: Cambridge University Press
ISBN: 1139463829
Category : Business & Economics
Languages : en
Pages : 316

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Book Description
What is the role of boards in corporate governance? How should they be structured in order to maximize value creation? This 2007 book looks at the role of boards in a variety of different countries and contexts, from small and medium-sized enterprises to large corporations. It explores the working style of boards and how they can best achieve their task expectations. Board effectiveness and value creation are shown to be the results of interactions between owners, managers, board members and other actors. Board behaviour is thus seen to be a result of strategizing, norms, board leadership, and the decision-making culture within the boardroom. Combining value creation, behavioural and ethical approaches to the study of boards, this work offers a systematic framework which will be of value to graduate students and researchers in the field of corporate social responsibility and business ethics.

Author: Vassilis Papadakis
Publisher: Springer Science & Business Media
ISBN: 1461561957
Category : Business & Economics
Languages : en
Pages : 315

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Book Description
Over the past ten years, there has been growing interest in the process of strategic decision-making among both managers and researchers. Strategic decisions are important for five main reasons: They are large-scale, risky and hard to reverse; they are a bridge between deliberate and emerging strategies; they can be a major source of organizational learning; they play an important part in the development of individual managers and they cut accross functions and academic disciplines. Strategic Decisions summarizes the current state of the art in research on strategic decision-making, with chapters prepared by leading strategy researchers. The editors also present implications for current application and proposed directions for future research.

Author:
Publisher:
ISBN:
Category : Dissertations, Academic
Languages : en
Pages : 78

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Book Description
There has been a growing interest in the study of boards of directors from a cognitive perspective. A number of studies have now accumulated which suggest that a range of concepts and techniques borrowed from the cognitive sciences offer considerable promises as a means of gaining rich insights into issues and processes which lie at the heart of the field of strategic management and corporate governance.