Top Management Team Characteristics, Corporate Strategic Change And Organizational Performance

Using the data from Chinese listing manufacturing companies, this paper tested the Upper Echelon Perspective proposed by Hambrick & Mason (1984). The relationship between environment and top-management-team characteristics, the relationship between top-management-team characteristics and corporate strategic change, and the relationship between top-management-team characteristics and organizational performance have been tested.The results show that the Upper Echelon Perspective can be applied in Chinese companies. The external and internal objective situation influenced the characteristics of the top-management-team, with industry sales growth, ownership and corporate diversification determining TMT demography. The firms most likely to undergo changes in corporate strategy had TMT characterized by higher average external succession, higher age heterogeneity, higher educational level heterogeneity, and lower average TMT tenure. While lower TMT tenure heterogeneity, lower functional background heterogeneity, higher age heterogeneity are related to higher organizational performance, such relationships are stronger in stable industries.