The Research Of The Antecedents And Effects Of Appointing A CTO In High-tech New Ventures

The number of Chinese high-tech new ventures is increasing due to policies that promote innovation,develop high and new technology industries,and the "mass entrepreneurship and innovation" initiative.Simultaneously,the rapid development of emerging technologies such as 5G,artificial intelligence,and cloud computing has amplified the challenges high-tech new ventures face like technological environment changes,market competition intensification,and unpredictable changes in customer demands.The Chief Technology Officer,the senior-most technology executive in TMT who utilizes their technical knowledge and expertise to direct strategic decision-making related to technology,has increasingly come under the spotlight.However,many Chinese high-tech new ventures have yet to appoint a CTO position.In theory,existing research focus on the role of CTO in established enterprises,and fewer studies explore the antecedents and effects of appointing a CTO position in an entrepreneurial context.This research probes into the antecedents of high-tech new ventures appointing CTO positions in China and scrutinizes the impact mechanism and boundary conditions of CTO positions and CTO characteristics on innovation activities and growth in high-tech new ventures.This research clarifies the factors that influence high-tech new ventures regarding appointing CTO positions and how CTOs can enhance innovation activities and growth in high-tech new ventures under various circumstances.The author conducts a literature review of functional TMT,Chief Technology Officers(CTO),high-tech new venture innovation,and growth of high-tech new ventures.Moreover,the author validates the research feasibility on the antecedents and effects of CTOs in an entrepreneurial context based on literature review and practice.Subsequently,through a multi-case study and two empirical studies,this research draws the following results.Firstly,high-tech new ventures need to address both legitimacy and differentiated needs when appointing CTO positions.Based on optimal distinctiveness theory,high-tech new ventures need to handle these needs according to contextual factors,such as industry environment,technology stage,and organizational life cycle to attain optimal objectives.Through a multi-case study,this research discovers that high-tech new ventures tend to appoint CTOs to enhance their legitimacy when competition intensity in the industry is high or technological maturity is low.Furthermore,when high-tech new ventures are oriented by technology or the orientation of both market and technology,as well as face the technical challenges brought by milestones,high-tech new ventures will choose to have CTO positions because the CTO positions can help new ventures to create competitive differentiation.high-tech new ventures appoint CTO positions when they are technologyoriented or both technology and market-oriented and are confronted with technical challenges generated by milestones as the CTO positions can assist new ventures in creating competitive differentiation.Secondly,CTOs must facilitate high-tech new venture innovation activities,and thus,how CTOs affect new ventures’ innovation activities is the next question that this research wants to address.Through a empirical study,it has been found out that having a CTO position can promote high-tech new ventures’ innovation activities,yet excessive CTO tenure hinders innovation.Furthermore,considering the high resource constraints of hightech new ventures,it is common for CEOs to also serves as the CTO(CEO/CTO duality),and CEO/CTO duality can only facilitate innovation activities when the CEO has a technological background and/or when the CEO is also the chairperson(CEO/Chair duality).Finally,CTOs can influence the allocation of enterprise resources and promote sustained growth in high-tech new ventures due to their powerful position within the firm.Empirical research suggests that powerful CTOs have the willingness and ability to invest significant resources in innovation,dynamically adjust resources allocation according to market demand,continuously carry out innovation activities,launch new or updated products and services that proactively respond to market changes,fueling growth in hightech new ventures.Meanwhile,the "mass entrepreneurship and innovation" policy reinforces a culture of innovation and encourages a competitive market environment,leading high-tech new ventures to construct market advantages through technological innovation and hasten the commercialization of innovative products.Therefore,the policy intensity of "mass entrepreneurship and innovation" reinforces the mediating role of R&D intensity between CTO power and high-tech new venture growth.The theoretical contributions of this research mainly focus on three aspects.Firstly,based on optimal distinctiveness theory,this research explores the process mechanism of high-tech new ventures in appointing CTO positions based on different needs around external industry environmental factors and internal technological strategic factors.It deepens the application of the optimal distinctiveness theory in the field of entrepreneurship and provides theoretical references for the reasonable appointing functional executives in the entrepreneurship context.Secondly,this research explores the relationship between appointing CTO positions and innovation activities based on upper echelons theory and attention-based view.It extends the application of relevant theories in TMT research and deepens the understanding of the CTO as a technical functional executive.Finally,this research analyzes the role of the CTOs in the growth of high-tech new ventures based on TMT power,constructs a path to increase the competitiveness of Chinese high-tech new ventures,and provides a new perspective on research of growth mechanisms in high-tech new ventures.In practice,this research offers guidance for Chinese entrepreneurs to reasonably appoint functional executives in accordance with their enterprise context and provides empirical support for high-tech new ventures to appoint CTOs.This is significant in guiding high-tech new ventures to recognize the crucial role of technical innovation and promote sustainable growth through effective implementation of innovation activities.