Astudy On The Relationship Between Top Management Team Heterogeneity And Firm Performance

With the rapid development of China’s economy and technology as well as thegradually improvement of the management level, the research of top management team isattracting increasingly attention. China’s SME listed sector achieved a sustained and rapiddevelopment since its inception in2004. In recent years, SME listed has been an importantforce in driving rapid economic and social development. However, the advantage of TMTin strategic decision-making is not been fully taken because of individuals dominateddecision-making, unscientific appointment. Faced with increasingly fierce competitiveenvironment, enterprises should continue to develop to get their competitive advantage.They need to build a TMT with efficient operation. Demographic characteristics of TMTplay an important role on firm performance. This paper based on the characteristics of SMElisted under China’s national conditions, try to find out the relationship between SEM listedTMT heterogeneity and firm performance, and focus on the moderating effect ofmanagerial discretion between them.In this paper, the research object is SEM listed. Based on the theory of upper echelons,this paper analyzes the relationship of TMT heterogeneity, managerial discretion andenterprise performance, and builds the theoretical models. This paper tests the TMTheterogeneity in four aspects: age, tenure, educational level and professional backgrounds,verifies the relationship of TMT heterogeneity and enterprise performance by collectingsample data from SEM listed annual report and SPSS statistical software for descriptivestatistical analysis, correlation analysis and multiple regressions analysis. And then thispaper tests the moderating effect of managerial discretion. The final study found that theTMT age heterogeneity, tenure heterogeneity, and professional background heterogeneityare negatively related to enterprise performance, educational level heterogeneity is notsignificant, managerial discretion plays a moderating effect to a certain extent between therelationship of TMT heterogeneity and enterprise performance. The moderating effect offirm size and age is negative, while R&D intensity and duality has positive effect.Finally, based on the findings, this paper provided some suggestions for SEM listedTMT building and operating to help enterprises to establish the TMT which is suitable fortheir own development and then contributing to the enterprise flourish.