Introduction
Two important themes of strategy research
over the last 20 years have been (a) the role of
top management (Lewin and Stephens, 1994) and
(b) the process of making strategic decisions
(Rajagopalan, Rasheed and Datta, 1993;
Papadakis and Barwise, 1998). Since Hambrick
and Mason’s (1984) seminal paper on ‘upper
echelons’, much emphasis has been placed on
the influence of top management on corporate
strategy, innovation, performance, organizational
structure and planning formality (e.g. Miller and
Toulouse, 1986; Finkelstein and Hambrick, 1990;
Bantel and Jackson, 1989; Smith et al., 1994).
However, with few exceptions (e.g. Papadakis,
Lioukas and Chambers, 1998), there has been
little empirical work on the link between these
two themes – top management (TM) characteristics
and the process of making strategic decisions (SDs).
In the words of Rajagopalan, Rasheed and Datta
(1993, p. 364): ‘Research relating organizational
factors such as . . . top management team (TMT)
characteristics to strategic decision processes is
limited.’ Others have argued along similar
lines (Lewin and Stephens, 1994; Smith et al., 1994).
Moreover, some researchers have always
questioned the significance of TM. For example,
Lieberson and O’Connor (1972), and Hannan
and Freeman (1977) argued that TM charac-
teristics have little influence on SDs. Stein (1980,
p. 332) went so far as to conclude that ‘leadership
does not constitute a meaningful contextual
domain influencing strategic procedures’. This is
a significant issue in strategy research that needs
to be resolved empirically.
This study focuses on the specific question:
‘How much do the CEO and the TMT influence
the making of SDs, relative to each other and to
the general context?’. To answer this question the
British Journal of Management, Vol. 13, 83–95 (2002)
© 2002 British Academy of Management
RESEARCH NOTE
How Much do CEOs and Top Managers
Matter in Strategic Decision-Making?
V. M. Papadakis and P. Barwise*
Athens University of Economics and Business, 76 Patission Street, 10434 Athens, Greece and
*London Business School, Regent’s Park, London NW1 4SA, UK
email: vpap@aueb.gr [Papadakis]; pbarwise@london.edu [Barwise]
This research note explores the influence of both CEO and top-management team
(TMT) characteristics on the process of making strategic decisions (SDs). Empirical
testing is based on a sample of 70 SDs in industrial enterprises operating in Greece,
using a combination of interviews, questionnaires and archival data. The results suggest
that (a) the characteristics of both the TMT and the CEO influenced the strategic
decision-making process, but the former had more influence, (b) the TMT and CEO
influenced different dimensions of the process, and (c) the broader context of SDs is
more influential than either the CEO or the TMT. Among the most important factors
was the TMT’s ‘aggressiveness’ (commitment to beating the competition, attitude to
innovation, willingness to take risks). The results lend support to the ‘upper echelons’
perspective, but suggest that in studying strategic decision-making processes both CEO
and TMT characteristics should be considered, in conjunction with the broader context.
Such an approach should provide a more reliable view of strategic processes and their
evolving dynamics.